Search Blogs

Blockchain technology is disrupting almost every sector in the world. This technology is making revolutionary changes in many industries and growing rapidly, so the terminology surrounding it. There are many terminologies used in blockchain technology. Each has its own significance & meaning. To utilize blockchain technology effectively, one must know all related key terms which are explained below:1. Address: An address is a very important term in the blockchain. It is nothing but a unique identifier used to identify the sender & receiver. A private key is used to generate an address that is unique to the address. Generally, the address is in the form of alphanumeric characters.2. Application Specific Integrated Circuit (ASIC):It is a type of computer processing chip that performs a singular function. ASIC boards have been used in the blockchain industry, to perform SHA256 hashing which is required for Proof-of-Work(PoW).3. Airdrop:Airdrops are related to blockchain projects, specifically ICOs. It is all about distributing free tokens to people as rewards. Airdrop may or may not have incentives attached to it. 4. Block: Transactions are stored into single and a new block of size 1MB is created every 10 minutes. Every block comprised 4 components: a summary of included transactions, a timestamp, reference to the previous block, and the Proof of Work.5. Block Depth:Block depth is defined as a block's position index in the blockchain relating to the most recently added block. A block that is seven blocks before the latest block will have a block depth of 6.6. Block Height:Block height is defined as a block's position index in the blockchain relating to zeroth block. The 10th block added in the chain will have a block height of 10.7. Block Reward:It is a reward that a miner gets after solving the block successfully. Miner adds the first transaction on the block, to claim the reward. The entire process starts with miners searching for blocks to be verified. After the block is found, transactions on the blocks are verified by solving a certain mathematical formula for the reward to be processed. Also, this reward is shared between the group of miners depending on the amount of work they have done.8. Blockchain:Blockchain is distributed ledger technology. It consists of nodes that carry a copy of the decentralized ledger. It can be described as a structure that stores transactional records in chronological order while maintaining security, transparency, and decentralization.9. Blockchain 1.0: The first generation of blockchain technology performs simple token transactions. Bitcoin is the most prominent example of Blockchain 1.010. Blockchain 2.0: The second generation of blockchain technology focuses not only on exchange transactions also on coding and programming in the form of smart contracts. Ethereum is the first of the blockchain 2.0 generation.11. Blockchain 3.0: This generation of Blockchain Development is an upgraded version of blockchain 2.0 with more focus on interoperability and scalability. The most promising blockchain 3.0 project is SkyCoin.12. Coin: A coin is a digital asset that is native to its own blockchain. E.g. Bitcoin, Ether, Litecoin, etc. Bitcoin functions on its own blockchain i.e. Bitcoin blockchain similarly Ether operates on the Ethereum blockchain.13. Consensus: The consensus is the process through which nodes agree on a single point of the data value in the network. There are various types of consensus algorithms such as Proof of Work (PoW), Proof of Stake(PoS), and Delegated Proof of Stake (DPoS).14. Consortium Blockchain: It is a semi-private blockchain that is controlled by two or more groups of companies. These chains would be appropriate for two or more parties that need immutable communication.15. Cryptocurrency: A cryptocurrency is a digital currency created as a medium for exchange that used cryptography to secure financial transactions.16. Cryptocurrency fork:A cryptocurrency fork is a process by which existing software protocol is split into two versions. A cryptocurrency fork happens when developers alter the source code to add new features resulting in two chains.17. Fork Hard:It means a change in software protocol makes two co-existing versions incompatible with each other. New blocks do not support old ones. In this case, all users have to work on a newer version of the network to stay in sync with the network.18. Fork Soft:It is a software upgrade that is compatible with old & new versions. It is called backward compatible, which means users won't be cut off from the network if they fail to upgrade the software.19. Cryptography:It is a technique used to secure communication between two or more parties by encrypting information.20. Bitcoin: It is one of the blockchain cryptocurrencies stored on a digital wallet. People can send or receive Bitcoins with this digital wallet. Every transaction is stored in a public list i.e. blockchain.21. DApp: DApp is an abbreviation for decentralized applications. These applications cannot be controlled by anyone without permission. That’s why decentralized! Decentralized apps need to be open-source, with the use of blockchain technology. DAPP is an open-source software platform implemented on decentralized blockchains. The token required for DApp has to be generated by the DAPP developers by programming the algorithms22. Decentralization: Decentralization is the process of distributing information collected to each node in the network.23. Decentralized Autonomous Organization (DAO): Decentralized Autonomous Organization is created by developers to automate decisions and facilitate cryptocurrency transactions.24. Distributed Ledger Technology (DLT): Distributed Ledger Technology is a digital system used for storing transactions & their details at multiple places at the same time. Unlike, traditional systems, distributed ledgers do not have central data administrators.25. Double Spend Attack: Double Spend Attack is a malicious activity performed by a miner or group of miners trying to spend crypto’s twice on the blockchain.26. Ether: Ether is a cryptocurrency for the Ethereum blockchain. It is provided as a reward to the nodes which validate the blocks on the Ethereum blockchain.27. Ethereum: Ethereum is an open-source platform with the ability to create a smart contract and develop, deploy, and maintain decentralized applications. This platform is fueled with its native tokens called Ether.28. Ethereum Classic: Ethereum Classic (ETC) is another cryptocurrency that came into existence after a hard fork happened on the Ethereum blockchain. This is when the big Ethereum Decentralized Autonomous Organization was hacked. As it was hard forked means it carries the properties of the Ethereum chain.29. Ethereum Gas: Ethereum gas is used as a basic unit to calculate the computational effort required to perform a transaction on the Ethereum blockchain. 30. Ethereum Virtual Machine: Ethereum Virtual Machine is a simulated state machine within each Ethereum node that is responsible for executing contract bytecode.31. Federated Blockchain: Federated Blockchain is simply an updated form of the fundamental blockchain model, which makes it additionally perfect for some specific use cases. It provides a private blockchain and a more customizable perspective. Federated blockchains are very like private blockchains, with a few additional features.32. Fiat Currency: Fiat money is issued and controlled by the government & is not backed by a physical commodity like gold or silver but instead backed by the government that issued it.33. Gossip Protocol: It is the process by which nodes in the network transfer information with all other nodes. When a node receives new information, it sends it to every other node in the network. Eventually, all nodes will have some piece of information as they all are connected.34. Hash: It is a cryptographic value that is generated by mapping the input of numbers and letters into an encrypted output.35. Hash Collision: A hash collision occurs when two different inputs hash the same value.36. Hashgraph: It is a distributed ledger that uses a gossip protocol to communicate transactions and tangle-style consensus algorithms.37. Hashrate: Hashrate is the speed at which a particular machine performs a hashing function. It is calculated as the number of times that machines can perform specific hash functions per second.38. Hash function: It is a cryptographic function that converts specific input into an encrypted output.39. Hyperledger: A framework of tools offered by IBM & hosted by the Linux Foundation to develop enterprise-level consortium chains.40. ICO: ICO stands for Initial Coin Offering. It is a fundraising mechanism through which new projects sell their crypto tokens in the exchange of cryptocurrencies.41. Immutability: Immutability is the ability of blockchain to remain unaltered or unchanged. Immutability is achieved because of decentralization.42. ERC20: ERC20 is the abbreviation of "Ethereum Request for Comments". It is the standard protocol used to issue tokens on the Ethereum network.43. Proof-of-Work (PoW): Proof-of-Work is a famous consensus algorithm utilized in blockchain networks. The process starts with assigning a block to the miners then miners solve them with a computational puzzle. It requires computational power to do so. Upon succession, miners are rewarded with blockchain tokens or value.44. Proof-of-Stake (PoS): Proof-of-Stake is another consensus algorithm. The nodes in a PoS based blockchain stake coins. Nodes with more stake coins have higher chances to be picked for making consensus decisions.45. Smart Contract: A smart contract is a self-executing agreement embedded in computer code and managed by blockchain. This code contains a set of instructions agreed by parties to that smart contract.46. Security Token Offering (STO): Security Token Offering is a kind of public offering in which security tokens are sold in cryptocurrency exchanges.47. Stable Coins: Stablecoins are new types of cryptocurrencies whose value is backed by another fixed asset like the US dollar. These coins can be pegged to fiat currency, for example, the US dollar, different digital forms of money, valuable metals, or a combination of the three. Fiat is likely a mainstream alternative in the marketplace nowadays, which means one unit of a stable coin equals $1.48. Token: The token is another synonym for cryptocurrencies that act as an asset or utility and reside on their own blockchain.49. Utility Token: A utility token is a digital asset used to finance the network where its buyers can consume some of the network's products.50. Security Token: A security token is another cryptographic token that is offered to investors after they invest in an ICO as a digital asset and act as financial security on the blockchain.Wrap upTo explore Blockchain Development, it is crucial to understand the terminologies mentioned above. To know more about Blockchain Development, take a look at the solutions offered by RWaltz.

Blockchain technology is evolving day by day with new tech trends adding to the space. Sidechains are considered to be the latest mechanisms that carry the tremendous potential to enhance the existing capabilities of the current blockchains. Let’s Discover What are Sidechains in Blockchain Development! A Sidechain is defined to be a separate blockchain network that links to a different blockchain i.e. the parent blockchain through a two-way peg. A crucial element of Sidechains is their ability to ensure smoother asset exchange between the secondary blockchain and the parent blockchain. This parent chain is referred to as the main chain or the mainnet. The secondary blockchains carry their own set of consensus mechanisms facilitating the blockchain network to enhance privacy and security. Sidechains are termed to be separate blockchains that branch out from the main chain. Side chains are often connected to the main chains through a two-way peg. Potential use cases of Sidechains are mainly in Blockchain Scaling Solutions. RWaltz is one of the leading Blockchain Development Companies that offer customized solutions based on your business demands. Crucial Components of Sidechains You Need to Explore! A Two-way PegThe development of sidechains was aimed to facilitate digital asset transfers between the blockchains irrespective of the owner or holder of the assets. There should be a smooth transfer of digital assets without any third-party or secondary actor pausing the transfer. Here, a two-way peg becomes important to facilitate the seamless transfer of digital assets between blockchains. A Two-way peg is termed as the mechanism through which coins are transferred between the sidechains. It is like a tunnel that connects both the parent chain and the side chain enabling coin transfers back and forth. Source: https://www.coindesk.comSmart Contracts It is interesting to note that, digital asset transfer is imaginary where the assets aren’t actually transferred. The assets are locked into the mainnet i.e. the parent blockchain and the equivalent amount is locked into the sidechain. These assets are locked and released on either end of the blockchains once the smart contracts validate the transactions. Smart Contracts play a key role in minimizing foul play by the enforcing validators on the parent blockchain and sidechain. The smart contracts notify the transactions to the parent blockchain once the transaction has occurred. Now, the off-chain process communicates the transaction information to the smart contracts on the sidechain and verifies the transaction. Once, the funds are verified by the smart contracts the digital assets can be transferred across both blockchains. Image Source: https://www.coindesk.com/Let’s Dig into the Roots of PolygonPolygon is an Ethereum layer 2 solution based on the concept of Sidechains. It leverages the Ethereum framework termed Plasma, which enables the creation of child chains. These chains facilitate transaction processing before being finalized on Ethereum Blockchain. Polygon is EVM compatible and issues its own native token i.e. Matic through the proof-of-stake validators. It features 2 Two-way pegs, out of which one is through Plasma and the other through Proof-of-stake Validators. At RWaltz, we have a team of experts working on polygon blockchain. We work on the latest technology trends and provide customized Blockchain Development to our esteemed clientele. Our RWaltz Whitelabel NFT Marketplace is built on Polygon Blockchain. Click here to explore our Blockchain Development services. Let’s Wrap UpHopefully, the above article was informative and has helped you resolve your queries on sidechains. If you are looking for a reliable Blockchain Development Company, we can be the right choice for you! Explore our Enterprise Blockchain Development Services and schedule a meeting with us now!

Blockchain technology is dramatically improving legacy data management and streamlining government operations delivering visibility to the citizens. Let’s dive into deep to explore more: Digital IdentityThe problem in the Existing System: The current system is prone to identity theft, where hackers copy the identities of others. For KYC onboarding, the users have to carry and submit heavy Identity documents. Also, the ID holders lack control over the way their identity can be used by the government. In addition, the probability of the user’s privacy being at risk is high. Solution by Blockchain Technology: Blockchain offers a secure solution to identity theft, where the users can store their IDs in a decentralized system. The system eliminates the need to submit IDs on an open website, rather users can authorize the agencies to retrieve a specific piece of information from the decentralized storage. Blockchain-based identity management allows citizens to take ownership of their identity by creating a global ID to serve multiple purposes. This also eliminates the need to carry multiple documents for KYC onboarding. Registries Problems in the existing system: The legal branches of government maintain records of heavy documents of land titles, criminal records, corporate documents, marriage entries, etc. This includes a lot of paperwork which is difficult to manage and time-consuming to retrieve the details. Since the entries are managed manually there is a high probability of errors and documents being misplaced. Solution by Blockchain: The registries based on Blockchain-supported distributed ledgers offer transparency and visibility to the entire system. Since the entire process is automated there are low chances of errors or corruption due to the absence of human intervention. Also, Blockchain technology stores the records on a distributed system, eliminating the heavy paperwork and leading to seamless management of registries. In addition, Blockchain-based registries allow adding correct multiparty digital signatures to the documents and transferring them within a fraction of a second. Central Bank Digital Currency (CBDC) The problem in the existing system: The cross-border transactions through the current system incur heavy costs. The traditional system is prone to crimes like money laundering and financial terrorism. In the case of fiats, the costs of printing cash, importing the note paper, and circulating fiats across the nation is high. Solution by CBDC: Blockchain-based CBDCs offer low domestic as well as cross-border transaction costs. CBDCs assist in preventing crime, money laundering, and financial terrorism by tracing and monitoring transactions. CBDCs also eliminate the risks associated with bank failure as all the transactions are recorded on a digital ledger. CBDCs are more secure, transparent, and cost-effective. Voting System The problem in the existing system: The possibility of data being hacked and votes being tampered is high. There is a high risk of voting ballots being delayed, waylaid, or even lost on the route. The current voting system requires huge management and thus is expensive. Solution by Blockchain: The blockchain-based voting system is a cost-effective and highly secure solution, where the possibility of votes being tampered is negligible. The decision tokens can be issued to the voters and they can cast votes through their own devices by logging onto an immutable Blockchain. This system also reduces the time and cost of verifying the election. Pharmacy Problems in the existing system: The traditional system experiences difficulties in tracking and monitoring drugs leading to emerging possibilities of counterfeit drugs. The manual intervention led to the mishandling of data which at times resulted in a shipment of expired products, mislabelling of medicines, or even delivery of contaminated drugs. No system can prevent the privacy of drug manufacturers by securing their drug production formula. Inappropriate inventory management leads to stockout or overstock scenarios. There have been increasing cases of clinical trial data being breached and information is at risk. Solution by Blockchain: Blockchain-enabled supply chain offers transparency and visibility across the network, enabling easier tracking of drugs. This reduces the possibility of counterfeit medicines reaching consumers. The smart contracts in the blockchain automate the process that offers appropriate handling of data which reduces manual errors. With Blockchain solutions, the manufacturers can secure their confidential information like drug formulas by storing it in the blocks in an encrypted form. Blockchain solution offers appropriate inventory management ensuring the demand and supply of drugs are in sync. Blockchain is a distributed system and has the potential to secure the data of the clinical trial, where accessing the research information becomes next to impossible. Agriculture Problems in the existing system: For the seed distribution scheme by the government, there is no system to monitor the process leading to uneven distribution of seeds. The current system is not able to verify the products at every phase of the supply chain, which ultimately leads to the delivery of damaged food products to the hands of consumers. Insurance claim settlement is a tedious task for farmers. Solution by Blockchain: The blockchain-based solution has laid a foundation for modern agriculture by enabling transparency in the seed distribution system. Also, a Blockchain-based supply chain monitors the farm produce at every stage and the information is recorded into the blocks in an encrypted form. This ensures the high quality of farm produce and also traces down the errors in the products. Blockchain has automated the insurance claim settlement for farmers eliminating the heavy documentation and delays. Wrap UpHopefully, you have understood how Blockchain can bolster government processes and operations.RWaltz is a Blockchain development company that offers customized solutions based on your demands. If you are looking forward to taking your government on a Blockchain journey, connect with us now.