This dictionary contains the basic terminology of blockchain technology and helps to understand its fundamentals.

A

Address — a unique identifier in the blockchain used for sending and receiving digital assets.

Airdrop — the free distribution of cryptocurrency to new users or project participants under certain conditions.

Altcoin — a general term for all cryptocurrencies other than Bitcoin.

Apeing – impulsive buying of a cryptocurrency without much research.

Arbitrage — Buying an asset at a lower price on one market/exchange and selling it at a higher price on another market to profit from the difference.

ATH (All Time High) — the highest value of an asset's price ever.

Atomic Swap — A peer-to-peer exchange of cryptocurrency assets across different blockchains.

B

Bears — traders who play for a fall in cryptocurrency prices: they borrow cryptocurrency from the exchange and sell it, and after the price drops, they buy it back at a lower price, keeping the difference.

Bitcoin – The first decentralized digital currency on a blockchain network.

Block — a data structure containing information about transactions and metadata about the block itself. Each block has its own unique identifier and is linked to the previous block using a hash function.

Blockchain — a continuous and sequential chain of blocks, built according to specific rules, containing some information. Each block in the chain is numbered and contains a record (hash) of the previous block and its own hash. Therefore, any change in the information in a block will change its hash.

Based on the rules for building the chain, any changes in the hash of the current block must be recorded in the next block, which causes changes to its own hash. Previous blocks are not affected. If the block being changed is the last in the chain, making changes may not require significant effort. But if there is a continuation after the changed block, the change can be a very laborious process.

Blockchain architecture – a design system that defines

The storage and management system in a blockchain network.
The organization of data and block formation.
The rules for security and transaction validation.
The blockchain's consensus mechanism, protocols, and encryption.

Bridging – Moving digital assets from one blockchain network to another.

Burning – Permanently removing cryptocurrency by sending it to an unreachable address.

Bubble — a market situation where the asset price significantly exceeds its real value.

Bulls — traders who play for a rise in cryptocurrency prices.

Byzantine Fault Tolerance (BFT) — A set of protocols that allow a distributed system to continue functioning even when it's components fail or are compromised. TON blockchain uses the BFT consensus to create new blocks on the network.

C

Central Bank Digital Currency (CBDC) – A digital version of a country's fiat minted and regulated by its central bank.

Coin — a unit of cryptocurrency used to pay for transactions and operations in the blockchain.

Confirmation Time – The duration for a transaction to be processed on the blockchain.

Consensus Algorithm — a mechanism that determines how network nodes reach a common agreement. The most common consensus algorithms are Proof-of-Work, Proof-of-Stake, and Delegated Proof-of-Stake.

Cold Wallet – Offline storage for crypto assets. Cold wallets are usually used for long-term cryptocurrency storage.

Cross-chain – Technology that lets different blockchains communicate and transfer assets.

Crowdsale (or ICO — Initial Coin Offering) — a method of raising funds for a project or enterprise based on blockchain technology, where investors buy new cryptocurrencies in the hope of their future growth.

Cryptocurrency — digital currency based on blockchain technology. It uses cryptographic methods to ensure the security and anonymity of transactions. Examples of cryptocurrencies: Bitcoin, Ethereum, Litecoin, and others.

D

DAO (Decentralized Autonomous Organization) – A self governing organization run by smart contracts and its members without central control. In a DAO, every member of the organization has a voting right to decide on the decisions.

Dapp (Decentralized Application) – An app that is hosted on a decentralized network like TON.

DDoS Attack – A cyber attack that overwhelms a blockchain network with traffic, slowing it down.

Decentralization — the distribution of authority among participants in the system, excluding control by a single person or group.

Decentralized Finance (DeFi) – Blockchain based financial services (lending, trading, etc) that has no middlemen.

Decentralized Oracle Network (DON) – A collection of independent oracles making sure the data from other oracles is valid.

Developer — the creator of cryptocurrency or software.

Domain Name System (DNS) – A naming service on a blockchain that abstracts the network's technicalities into human-readable terms registered on the blockchain network. A popular use of DNS service is the abstraction of wallet addresses; users can link their long, incomprehensible wallet addresses into a simple word or phrase like «Mynickname.ton» as their wallet address on TON blockchain.

Dump — the artificial lowering of cryptocurrency prices by large market players.

Dust – Diminutive values of cryptocurrency that are too small to trade.

Dusting Attack – A privacy attack using tiny crypto amounts to trace wallet owners.

E

Encryption — the process of transforming data into an unreadable format using keys. In blockchain, encryption is used to protect user privacy and ensure transaction security.

ERC-20 – A standard protocol for creating and identifying tokens on Ethereum.

F

Faucet — a mechanism for distributing free cryptocurrencies to new users or project participants, also used in testnets.

Fiat – Government-issued currency such as dollars and euros.

Flash Loan – A loan borrowed and repaid in the same transaction. It is common in DeFi services.

FOMO (Fear of Missing Out) – Anxiety of missing out on a profitable opportunity leading to impulsive buying.

Fork — the division of a blockchain network into two separate chains.

G—

Gas — a unit of measurement for the cost of performing operations or executing smart contracts.

Genesis Block — the first block in a blockchain.

H

Halving – Reducing the production of new tokens and the reward for mining new blocks by half.

Hard Cap – The maximum amount of money a project aims to raise during a token sale.

Hard Fork – A copy of an existing blockchain with modified protocols, creating a similar but separate blockchain that is backward incompatible.

Hash — a function that produces an irreversible transformation of arbitrary data structures into a single fixed-length number.

Hashrate – A metric that shows the amount of computing power used to secure blockchain transactions and verify new blocks on the network.

Hot Wallet – Online wallet for everyday transactions. It is suitable for small to medium storage of crypto assets.

Hybrid Blockchain – A blockchain network with both public and private blockchain capabilities.

Hypercube Routing Protocol (HR) — An algorithm that helps nodes in a network to find the shortest path to connect and share data.

I—

Immutability – A key element of blockchain technology. Once data is written on a block, it cannot be altered unless more than half of the whole network agree to change it. This becomes harder as the network grows.

Impermanent Loss – A temporary loss from providing liquidity due to price changes.

Interoperability – The ability of different blockchains to work together and share data.

J

Jetton — The standard name for tokens on TON.

K

Keys — secret combinations of symbols used to access digital wallets and manage funds.

L

Layer 1 – The main blockchain that processes and verifies transactions (e.g, TON, Bitcoin)

Layer 2 – A network built on a layer 1 blockchain to improve scalability and reduce fees.

Liquidation — occurs when an exchange forcibly closes a trader's leveraged position due to partial or complete loss of the initial margin. This happens when the trader cannot meet the margin requirements for the leveraged position, meaning they do not have enough funds to maintain the open trade. Liquidation occurs in both margin and futures trading.

Liquidity Mining – Earning rewards by providing liquidity (funds) to decentralized exchanges.

Liquidity Pool – A pool of funds locked in a smart contract to enable trading on a decentralized exchange.

M

Market Maker – A financial institution or an investment firm that creates liquidity in the market. Also known as a liquidity provider, a market maker continuously buys and sells assets in a market, keeping liquidity flowing.

Market Order – An order to buy or sell an asset immediately at the current market price.

Masterchain (master blockchain) — the main blockchain that stores information about the number and configurations of workchains, the number of shardchains and their prefixes, which nodes are responsible for which shardchains, as well as the hashes of the latest added blocks in all shardchains.

Thanks to the hashes of blocks from all shardchains in its blocks, it makes the system interconnected. This also means that the generation of a new block in the masterchain will occur immediately after the generation of blocks in the shardchains, so blocks in shardchains will appear almost simultaneously approximately every 5 seconds, and the next block in the masterchain will appear a second after that.

Mempool — a queue of unconfirmed transactions in the blockchain awaiting processing by miners.

Merkle Tree – A structure that helps to quickly verify large transactions on the blockchain.

Miner — a person or device engaged in mining.

Mining — the process of adding new blocks and issuing coins in blockchains with Proof-of-Work consensus.

Money Hold — a restriction on the deposit or withdrawal of funds for a certain period.

Multisignature (multisig) — a method of signing transactions that requires the consent of several participants to confirm the transaction.

N

NFT (Non-Fungible Tokens) — unique non-interchangeable tokens representing digital ownership rights to objects such as texts, images, audio, and video.

Node — software that ensures the system's operation. Nodes perform data storage and transmission tasks, and moderates the activities of a blockchain network.

Nonce – A number that can only be used once in mining to find a valid block.

O

Obfuscation — the process of tangling the source code of smart contracts confusing to complicate their analysis and modification.

Off-chain – Transactions that happen outside the blockchain to reduce costs and speed up processing.

Open Source — a development principle where software's source code is available for study and modification by the developer community.

Oracles – Services that provide real-world data to smart contracts.

P

Pending — the state of a transaction awaiting confirmation and inclusion in the next block.

Pool — an association of miners for joint cryptocurrency mining.

Private blockchain – A closed blockchain network only available to whitelisted devices or organisations.

Pre-Mining – Mining coins before a cryptocurrency is available to the public.

Proof of Burn (PoB) – A system where coins are destroyed (burned) to earn the right to validate new blocks.

Proof of Stake (PoS) – A system where investors gain validator rights by staking the governing token.

Proof of Work (PoW) – A system where miners solve puzzles to validate transactions and earn rewards.

Public blockchain – A blockchain open and accessible to everybody.

Pumping [in the context of cryptocurrencies] — a situation where the price of a cryptocurrency rises sharply and quickly for a short time.

R

Replay Attack – An attack where a transaction is maliciously repeated on another blockchain

Rug Pull – A scam where developers take investors’ funds, drain liquidity, and abandon the project.

S

Satoshi – The smallest amount of Bitcoin with nine decimal places (equal to 0.000000001 BTC).

Scalability – A blockchain’s ability to handle more transactions as it grows.

Shardchain — the main part of scaling. Within one workchain, there can be 2⁶⁰ shards. Shards can interact with each other, with each shard responsible for specific accounts and adhering to all the rules of its workchain.

Sharding (“shard” is a segment) — the process horizontally the blockchain database into smaller segments (shards) that can perform operations in parallel to distribute the load.

Slashing – A penalty where validators lose part of their staked funds for bad actions or poor performance.

Smart Contract — a self-executing computer algorithm in which the terms of the agreement are written. It is designed to automate the execution of agreements between two parties.

Soft fork – A backward compatible update to an existing blockchain (e.g the latest wallet versions on TON blockchain can still make transactions to older wallets and vice versa).

Spread — the difference between the buy and sell price of an asset on an exchange.

Stablecoin — a cryptocurrency with a fixed rate, pegged to the dollar or another asset.

Staking [in the context of cryptocurrencies] — the process of participating in a blockchain network by locking (freezing) a certain amount of cryptocurrency as a guarantee of performing certain functions or duties. Network participants (stakers) lock their funds for a certain period to participate in the process of creating blocks, ensuring network security, or voting on various protocol issues.

Swap — a term usually used to describe a service or platform that provides cryptocurrency exchange services directly between users or between cryptocurrencies. These services typically allow users to exchange one cryptocurrency for another without the need to go through exchange registration procedures.

Sybil – A fake identity usually created by a single person or group to claim a larger allocation than they would with a single account.

Sybil Attack – When a single user controls a large number of network nodes and uses them to influence protocols and decisions in the network, deceiving the network into assuming each node is independent.

T

Trading — the buying and selling of cryptocurrencies on an exchange, realized by traders based on their knowledge and experience.

Transaction — an operation of transferring cryptocurrency from one user to another.

Token – A digital asset on a blockchain network representing currency, utility, security or other forms of value.

V

Validator – A node that verifies transactions on a Proof of Stake blockchain and earns reward in return.

Volatility — changes in cryptocurrency prices over time.

W

Whales — large market participants with significant capital who can influence cryptocurrency price movements.

Workchain — combines shards. There can be a maximum of 2³² such workchains, each with a unique identifier and its own logic. Each workchain, for example, can have its own virtual machine and address formats. The first workchain has prefix 0 — it is reserved for the main TON workchain.

Wrapped Token – An asset on a blockchain network bridged from another Blockchain network.

Z

Zero Knowledge Proof – A cryptographic formula used to verify the ownership of an asset without showing the asset as proof.

In conclusion, blockchain terminology includes many concepts and definitions related to distributed ledger technology. Understanding these terms will help better understand the principles of blockchain operation and its application in various fields.

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