Bitcoin prices blew up in 2017, reaching a peak of a whopping $20,000. After that, the entire planet was talking about this new technology called blockchain. We saw in our previous article what this blockchain actually is. Now let’s get familiar with some of the terms we may repeatedly come in close contact with; every time we talk blockchain.
Cryptocurrency is a fancy word. But its meaning is boringly simple. It’s just money. The only difference is that this money is completely digital. Which means, it doesn’t exist out of your computer. And you can use it just as how you’d use the conventional money; to buy things.
Bitcoin is one of the reasons why blockchain became a common term. Bitcoin is a cryptocurrency implemented using blockchain technology. It is the world’s first decentralized cryptocurrency. It was invented in 2008 by an unknown person or a group of people using the name Satoshi Nakamoto. There’s no central bank or any single intermediary administrator to control the issue and supply of bitcoins. This is one of the reasons why bitcoin became very famous.
For a transaction to occur inside the blockchain network it should be validated by a group of members inside the network. This group of people who validate each transactions are called Miners. And this process of validation is called Mining.
A contract is an agreement between two or more parties to do something. A smart contract is the digital version of this contract. Smart contracts help you to exchange anything of value in a transparent, conflict-free way while avoiding the services of a middleman. It is a self-executing or self-enforcing agreement. Which means that, if the rules of the agreement are met, the agreement is automatically enforced.
Launched in 2015, Ethereum is an open-source, blockchain-based, decentralized software platform used for its own cryptocurrency, ether. It enables Smart Contracts and Distributed Applications (DApps) to be built and run without any downtime, fraud, control, or interference from a third party.
Hyperledger is a blockchain framework to develop blockchain-based applications, mainly for enterprises.
Tokens are digital assets in a blockchain network. Ok, don’t scratch your head. You have been to a gaming arcade, right? So what did you do there? You gave some money in the counter and got a card in which you can swipe on the gaming consoles of the games you wanted to play. That card acts like money in that particular arcade and you got to enjoy the games without any hassle and worry of payment. But if you take that card to Starbucks and demanded a caramel frappuccino the only thing you’d get would be a disappointment. This is exactly how a token works. They can act as a stand-in for money in a particular blockchain network. And outside that network, the tokens are basically worthless.