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

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

– “Blockchain” –

Blockchain technology is a computer protocol that allows you 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 log keeps track of all the operations that have taken place since its launch.

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

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

– NFT (or “non-fungible token”) –

An acronym for “Non-Fungible Token”, the NFT is a “non-fungible token”, ie non-replaceable and therefore unique.

Specifically, 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 owner.

NFTs, which derive their value from the object they are attached to, have made headlines in recent months through several sensational 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 through a specific protocol. One of these is called “Proof of Work”.

It consists of asking a person to solve a complex mathematical problem that requires considerable computing power, an energy-intensive process, to validate a new block on the chain.

Its operation, although very safe, nevertheless poses some energy consumption problems.

– “Proof of participation” –

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

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

In other words, it is the bet that allows you to participate in the validation of the network, a sum that can be seized in case of misconduct.

– “Smart Contract” (or “Smart Contract”) –

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

In the case of NFTs, these rules may, for example, limit the number of copies available for sale, or organize a system of royalties (copyright) that allows the original author of a work to be remunerated during each transaction.

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