Blockchain Journal Glossary

Confused about all the blockchain terminology and phraseology? So were we. Especially given how there are so many different definitions for the same things. We at Blockchain Journal don’t necessarily want to add to the confusion with yet another blockchain glossary (yes, there are many). However, any productive multi-stakeholder conversation about blockchain in the enterprise must be rooted in a common blockchain vernacular. And the same is true of all of our content. Therefore, over time, the terms in our glossary will not just be about simple definitions to which you and your stakeholders and our content can align. For each blockchain term and phrase in our glossary, we will also help you to understand the enterprise relevance.

Blockchain Adoption

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Tokens

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Airdrop

What is the definition of an airdrop?An airdrop is the act of distributing tokens (fungible or non-fungible) to numerous wallet addresses. Airdrops or “drops” are often used as a marketing tool for cryptocurrency start-ups. What are examples of fungible and non-fungible token airdrops?There are some subtle differences between the typical drop of actual cryptocurrency (fungible tokens) and non-fungible tokens. In the case of a cryptocurrency airdrop, a project may announce that it is offering fre...

Community Integrated Development Environments (IDE)NFT Customer Engagement

Algorithm

What is the definition of an algorithm?An algorithm is a sequence of instructions or steps that can help ensure that a specific task or computation is completed. Additionally, algorithms also can deterministically achieve predictable results given the same inputs and/or conditions at the start of the sequence. Algorithms don’t need to be digital or computerized algorithms. For example, some or all of a math proof on a blackboard can be an algorithm. But, when an algorithm is represented as progr...

Algorithmic Stablecoin

What is the definition of an algorithmic stablecoin?In order to understand how algorithmic stablecoins are supposed to work, it’s important to know the definition and role of a stablecoin. Briefly, a stablecoin is a type of cryptocurrency that remains stable in its value relative to a fiat currency such as the US dollar. The value of one unit of stablecoin is therefore said to be “pegged” to one unit of the associated fiat currency. As examples, each unit of the stablecoins USD Coin (USDC) and T...

Stablecoins Tokenomics

Altcoin

What is the definition of an altcoin?Altcoin (alternative coin) is a term that’s often used to describe any cryptocurrency coin that is not Bitcoin. The term also includes the projects and distributed ledgers on which the so-called altcoins are based. For example, Solana, the public distributed ledger on which SOL (the native cryptocurrency of Solana) is based, is sometimes referred to as an altcoin network, altcoin blockchain or altcoin ledger. Or, in an especially lazy reference, even though S...

Decentralized Finance (DeFi)

Annual Percentage Yield (APY)

What is the definition of Annual Percentage Yield?Annual Percentage Yield (APY) refers to the annualized rate of return from a financial investment — usually into something like a savings account (or a similar financial instrument that resembles a savings account such a cryptocurrency account) — that grows through some form of compounding. What is a real-life example of Annual Percentage Yield?For example, with a savings account, after an initial deposit earns its first round of interest, the ne...

Decentralized Finance (DeFi)

Anonymity Enhanced Cryptocurrency (AEC)

The key to understanding an Anonymity Enhanced Coin (AEC) lies in the varying degrees to which different cryptocurrencies (including standard cryptocurrencies like Bitcoin) offer anonymity and transaction confidentiality to the parties that are involved in a transaction. When transactions involve a cryptocurrency like Bitcoin, the parties involved in those transactions are psuedonymously represented through the public keys that are associated with their Bitcoin accounts. In contrast to the recor...

Anti-Money Laundering (AML)

Anti-Money Laundering (AML) is a set of policies, regulations and laws to prevent concealing crimes that produce monetary gain. These crimes include tax evasion, drug and human trafficking, fraud, selling stolen goods, terrorism and corruption.The international AML watchdog, Financial Action Task Force (FATF), sets standards to prevent these illegal activities, and more than 200 countries and jurisdictions have committed to implementing them.In the US, laws have been implemented to combat money ...

Regulation Legal

Blockchain

What is the definition of blockchain? In a nutshell, a blockchain is a database that technologically consists of a chain of digital blocks with each block constituting one of the multiple sequentially ordered chain links that make up a digital chain — a so-called “blockchain.” Each of these blocks (or links) contains an immutable record of one or more transactions (in some cases, thousands of transactions). Although a gross oversimplification of how blockchain technology works, blockchains invol...

Burn

When cryptocurrency is burned, it means that a certain amount of tokens have been removed from the total number in circulation. There are different ways that tokens can end up getting burned. For example, on some ledgers, as transactions go through the consensus algorithm, a transaction fee is paid and, subsequently, a specific fraction of that transaction fee is burned. Ethereum is one ledger that works this way. However, not all ledgers burn tokens as a part of the validation process. Algorith...

Candidate Block

A candidate block is one of multiple blocks that have been prepared with the intention of being added as the newest block onto a blockchain. Not all candidate blocks make it through the process, which is why they are initially considered to be candidates. For a public distributed ledger based on blockchain technology, the ledger itself consists of a continuously growing chain of chronologically ordered digital blocks (basically, the “links” in the chain), each of which is essentially a batch of ...

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