Blockchain terms that you should be aware of - Part 2

Written by Sushanth Kumar Reddy Kura | Published 3 months ago | 3 min read


In my previous blog, I have covered the top blockchain terms that everyone should be aware of. This a continuation of that blog. Hope you will find it useful. I tried my best to explain these terms in the easiest way possible. 

1. Segregated Witness (SEGWIT)

SEGWIT is a process where the transaction signatures are separated from bitcoin transactions. Allowing more transactions to fit within one block. It is basically a soft fork change in the transaction format of Bitcoin. 

2. Custody

Custody refers to the ownership of one’s funds or assets. For example: If your assets are in exchange that means your assets are in the custody of the exchange. They hold your private keys.

3. Mempool

It can be referred to as a node’s mechanism to keep track of unconfirmed transactions that the node has seen up to date ( but yet have not been added to a block in the blockchain.)

4. Difficulty Bomb

The term Difficulty Bomb refers to the increase in the mining difficulty of the Ethereum as a result of its migration from proof of work to proof of stake.

5. Gossip Protocol

In brief, it is a method of asynchronous peer-to-peer communication between the nodes of a distributed system. It is used to ensure that information is disseminated to all the members/nodes in the network.

6. Fungible Tokens

Fungible tokens can be called digital assets that are built so that each individual token is identical to another and can be interchanged. For example, a Bitcoin can be interchanged with another Bitcoin.

7. Non Fungible Tokens (NFT)

Non - Fungible tokens are the digital assets built so that each token is not identical to another and these cannot be interchanged. For example, These kinds of tokens can be used in representing the certificates like academic degrees, driver's license, etc which will ensure that forgery cannot be done.

8. ERC-721

It is a standard that was introduced for Ethereum based non-fungible tokens. All the NFT that we see today on the Ethereum blockchain are built on this standard.

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