Proof of stake, “smart contract”, NFT: glossary to better understand…

A complex technological object, the “blockchain” is accompanied by new concepts, with sometimes obscure names. Here is an explanation for five of them.

– “Blockchain” –

Blockchain technology is a computer protocol, which makes it possible to build and share a huge computer ledger. This is not administered by a central authority but by a community of validators, none of whom can take power.

Reputed to be tamper-proof, this register keeps track of all operations that have taken place since its launch.

Born after the financial crisis of 2008, the most famous “blockchain” is Bitcoin and its associated cryptocurrency, which is totally virtual. Many other “blockchains” have since been launched such as Ethereum, Solana, Tezos, PolkaDot or Avalanche.

They support new types of digital assets like non-fungible tokens (NFTs).

– NFT (or “non-fungible token”) –

Acronym for “Non-Fungible Token”, the NFT is a “non-fungible token”, that is to say non-substitutable and therefore unique.

Concretely, it is a tamper-proof digital certificate of authenticity, registered in the “blockchain”. This testifies to the ownership of a real or digital object for its holder.

NFTs, which derive their value from the object to which they are attached, have made headlines in recent months through several resounding auctions, such as the sale of the Twitter boss’s first tweet for $2.9 million.

They are used in particular in the cultural world (art, cinema, video games, etc.).

– “Proof of Work” –

To validate transactions on the “blockchain”, network players must prove their legitimacy by a specific protocol. One of them is called the “Proof of Work”.

It consists of asking a person to solve a complex mathematical problem requiring significant computing power, a very energy-intensive process, in order to validate a new block on the chain.

Its operation, although very secure, nevertheless poses certain problems of energy consumption.

– “Proof of Stake” –

To limit the carbon footprint of the “blockchain”, the creator of Ethereum, Vitalik Buterin, and his community want to switch to a more modern and less energy-intensive transaction validation method: the “Proof of Stake” (or “Proof of Stake”). ‘issue’, in French).

Participation in the validation of the network is then no longer linked to the use of high computing power but to the guarantee of part of its capital in ether, a cryptocurrency, in order to prove its seriousness in the eyes of of the other participants.

In other words, it is the wagering that allows participation in the validation of the network, this sum can be seized in the event of misconduct.

– “Smart contract” (or “Intelligent contract”) –

“Smart contracts” or “intelligent contracts” are irrevocable computer programs registered in the “blockchain”, which execute a set of predefined instructions.

In the case of NFTs, these rules can, for example, limit the number of copies available for sale, or organize a system of royalties (authors’ rights) making it possible to remunerate the original author of a work during each transaction.

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Proof of stake, “smart contract”, NFT: glossary to better understand…


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