Tech Space Quick Definitions

Consensus mechanism: A consensus mechanism is an algorithm that participants use to reach an agreement on the state of the blockchain ledger, including the order of transactions. The most popular algorithm is Proof-of-Work (PoW), followed by Proof-of-Stake(PoS), and Delegated Proof-of-Stake(DPoS). 

Hash: The process in which data is mapped to a fixed size. Hashing plays an essential role in cryptography. In a blockchain network, the hash value of one transaction is the input of another transaction.

Nonce: “number only used once,” which is a number added to a hashed or encrypted block in a blockchain. The 32-bit number generated randomly only one time helps create a new block or validate a transaction. 

Nodes

Full node: maintains a full copy of all the transactions and has the capability to validate, accept, and reject the transaction.

Partial node (lightweight node): maintains only the hash value of the transaction. The whole transaction is accessed using the hash value. 

Ledgers

Public ledger: it’s open to all. Anyone in the blockchain network can read or write something. 

Distributed ledger: All nodes have a local copy of the database in this ledger. Here a group of nodes executes the transaction by verifying and adding the blocks in the chain. 

Decentralized ledger: no one node or group of nodes has central control. Every node participates in the execution of the job. 

Wallets

 A digital wallet allows users to store their cryptocurrency. Every node in the blockchain network has a wallet. Privacy of a wallet in a blockchain network is maintained using public and private key pairs. There is no need for currency conversions as the currency in the wallet is universally acceptable. 

Hot wallet: wallets used for day-to-day online transactions and connected to the internet. These wallets are vulnerable to hackers since they are connected to the internet.

Online/web wallets: runs on the cloud platform, e.g., MyEtherWallet, MetaMask Wallet.

Software wallets: consists of desktop wallets and mobile wallets. Desktop wallets can be downloaded on a desktop, and the user has full control of the wallet, e.g., Electrum. 

Mobile wallets: Designed for smartphone devices e.g., mycelium. 

Cold Wallets: these wallets are not connected to the internet; thus hackers can’t attack them. e.g., paper wallet, hardware wallet.

Paper wallets: Offline wallets where a piece of paper contains the crypto address. The private key is printed in QR code format. QR code is scanned for cryptocurrency transactions.

Hardware wallets: A physical, electronic device that uses a random number generator associated with the wallet.

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