51% attack (s.v. "51% attack"): A condition in which more than half the computing power on a cryptocurrency network is controlled by a single miner or group of miners. That amount of power theoretically makes them the authority on the network. This means that every client on the network believes the attacker’s hashed transaction block. This gives them control over the network, including the power to:
· Issue a transaction that conflicts with someone else’s.
· Stop someone else’s transaction from being confirmed.
· Spend the same coins multiple times.
· Prevent other miners from mining valid blocks. (†2315)
blockchain (s.v. "Blockchain"): The full list of blocks that have been mined since the beginning of the bitcoin cryptocurrency. The blockchain is designed so that each block contains a hash drawing on the blocks that came before it. This is designed to make it more tamperproof. · To add further confusion, there is a company called Blockchain, which has a very popular blockchain explorer and bitcoin wallet. (†2316)
double spending (s.v. "Double spending"): The act of spending bitcoins twice. It happens when someone makes a transaction using bitcoins, and then makes a second purchase from someone else, using the same bitcoins. They then convince the rest of the network to confirm only one of the transactions by hashing it in a block. Double spending is not easy to do, thanks to the way that the bitcoin network operates, but it is nevertheless a risk run by those accepting zero-confirmation transactions. (†2317)
fork (s.v. "Fork"): The creation of an alternative ongoing version of the blockchain, typically because one set of miners begins hashing a different set of transaction blocks from another. It can be caused maliciously, by a group of miners gaining too much control over the network (see 51% attack), accidentally, thanks to a bug in the system, or intentionally, when a core development team decides to introduce substantial new features into a new version of a client. A fork is successful if it becomes the longest version of the blockchain, as defined by difficulty. (†2318)
genesis block (s.v. "Genesis block"): The very first block in the block chain. (†2319)
mining (s.v. "Mining"): The act of generating new bitcoins by solving cryptographic problems using computing hardware. (†2320)
multisignatures (multisigs) (s.v. "Multisig"): Multi-signature addresses allow multiple parties to partially seed an address with a public key. When someone wants to spend some of the bitcoins, they need some of these people to sign their transaction in addition to themselves. The needed number of signatures is agreed at the start when people create the address. Services using multi-signature addresses have a much greater resistance to theft. (†2321)
node (s.v. "Node"): A computer connected to the bitcoin network using a client that relays transactions to others (see client). If you’d like to run a bitcoin node, then bitcoin.org offers a comprehensive guide. (†2322)
nonce (s.v. "Nonce"): A random string of data used as an input when hashing a transaction block. A nonce is used to try and produce a digest that fits the numerical parameters set by the bitcoin difficulty. A different nonce will be used with each hashing attempt, meaning that billions of nonces are generated when attempting to hash each transaction block. (†2323)
proof of stake (s.v. "Proof of stake"): An alternative to proof of work, in which your existing stake in a currency (the amount of that currency that you hold) is used to calculate the amount of that currency that you can mine. (†2324)
proof of work (s.v. "Proof of work"): A system that ties mining capability to computational power. Blocks must be hashed, which is in itself an easy computational process, but an additional variable is added to the hashing process to make it more difficult. When a block is successfully hashed, the hashing must have taken some time and computational effort. Thus, a hashed block is considered proof of work. (†2325)
