Immutable:
Immutable means “not capable of or susceptible to change.” This concept is at the core of blockchain technology, making it reliable and secure—just like the laws of physics or blockchain-based records.
Blockchain:
A blockchain is a decentralized digital ledger that records transactions across multiple computers. This system makes it nearly impossible to alter, hack, or cheat the network.
Consensus Mechanism:
A consensus mechanism ensures all nodes in a blockchain network agree on the validity of transactions. Examples include Proof of Work (PoW) and Proof of Stake (PoS).
Key Blockchain Components
NFT (Non-Fungible Token):
NFTs are unique digital assets stored on a blockchain, commonly used for art, collectibles, and gaming assets.
Crypto Asset:
A crypto asset is a digital representation of value or rights that can be stored, traded, or transferred on a blockchain.
Gas Fees:
Gas fees are payments made to compensate the computational power required to process and validate blockchain transactions.
Protocol:
A protocol is a set of rules governing how blockchain systems operate and interact.
Ethereum Ecosystem
Ethereum:
Ethereum is a Layer-1 blockchain platform known for its ability to execute smart contracts and support decentralized applications (DApps).
Ether (ETH):
The native cryptocurrency of the Ethereum network, Ether, is used for transactions, staking, and executing smart contracts.
Solidity:
Solidity is Ethereum’s programming language for writing smart contracts.
Layer-1 vs. Layer-2:
- Layer-1: Foundational blockchain networks like Ethereum or Bitcoin.
- Layer-2: Secondary protocols (e.g., Immutable zkEVM, Immutable X) built on Layer-1 to enhance scalability and reduce costs.
Wallets & Security
Wallet:
A crypto wallet allows you to store, manage, and view digital assets like cryptocurrencies and NFTs.
MetaMask:
A browser extension wallet used to manage Ethereum-based assets and interact with decentralized platforms.
Seed Phrase:
A randomly generated set of words used to recover your wallet. Protect it carefully, as losing it may result in the permanent loss of your assets.
Private Key:
A private key is a cryptographic code giving access to your wallet. It must be kept secret and secure.
Token Standards
ERC-20:
A standard for creating fungible tokens on the Ethereum blockchain, such as stablecoins or utility tokens.
ERC-721:
A standard for non-fungible tokens (NFTs), ensuring they are unique and tradable.
ERC-1155:
A multi-token standard allowing for the creation of both fungible and non-fungible tokens within a single smart contract.
Advanced Blockchain Concepts
Minting:
The process of creating a digital asset (e.g., an NFT) and registering it on a blockchain as a unique, immutable record.
Smart Contract:
Self-executing programs stored on a blockchain that automate transactions based on predetermined conditions.
Staking:
Locking up cryptocurrency to support network operations and earn passive rewards.
Bridging:
The process of transferring digital assets between two different blockchain networks, such as moving ETH from Ethereum to a Layer-2 network.
Rollups:
A Layer-2 scaling solution that bundles multiple transactions into a single batch to improve blockchain efficiency and reduce costs.
Decentralized Ecosystem
Decentralized Application (DApp):
Applications running on a blockchain network without central authority, offering transparency and user control.
Decentralized Exchange (DEX):
Platforms for peer-to-peer cryptocurrency trading without intermediaries, ensuring greater privacy and security.
Decentralized Finance (DeFi):
Blockchain-based financial services offering alternatives to traditional banking, including lending, borrowing, and earning interest.
DAO (Decentralized Autonomous Organization):
An organization governed by blockchain-based rules and controlled by members, not a centralized entity.
Consensus Mechanisms
Proof of Stake (PoS):
A consensus mechanism where validators are selected based on the cryptocurrency they stake, offering energy efficiency compared to Proof of Work.
Proof of Work (PoW):
The original consensus mechanism requiring miners to solve complex mathematical puzzles to validate transactions and secure the network.
Miscellaneous Terms
Tokenization:
The process of converting real-world assets into digital tokens on a blockchain, enabling fractional ownership and easy transfer.
Immutable zkEVM:
A zkEVM (Zero-Knowledge Ethereum Virtual Machine) is a Layer-2 scaling solution combining Ethereum’s security with faster and cheaper transactions.
Governance Token:
A type of cryptocurrency granting holders voting rights in a project’s decision-making process.
Liquidity Pool:
A pool of funds provided by users in DeFi protocols to facilitate trading, lending, and borrowing activities.