Infrastructure

Zero-knowledge rollup scaling solutions

Zero-knowledge rollups, or ZK rollups, are layer 2 scaling solutions designed to improve the scalability and throughput of blockchain networks like Ethereum. They achieve this by moving most of the computational and storage burdens off-chain while still maintaining the security guarantees of the underlying layer 1 blockchain.

ZK rollups bundle multiple transactions into a single proof, "roll it up", and submit only the essential information to the main chain, reducing the data size and cost of on-chain operations. The term "zero-knowledge" refers to the cryptographic technique used to validate bundled transactions without revealing individual transaction details.

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Learn more about ZK scaling solutions.

The Graph

The Graph is an indexing protocol specifically designed for querying and retrieving data from blockchain networks such as Ethereum and IPFS (InterPlanetary File System). It allows developers to create and publish subgraphs, which are open APIs that define how to extract and organize specific data from the blockchain. By indexing and abstracting the blockchain data, The Graph provides developers with an efficient way to access decentralized data and build decentralized applications (DApps) that require real-time and reliable information.

Blocks

In the context of blockchain technology, a block refers to a collection or batch of transactions that are bundled together and added to the blockchain as a single unit. Each block contains a unique identifier called a hash, which is generated based on the block's content and the hash of the previous block in the chain. This chaining of blocks with their hashes creates an immutable and tamper-evident ledger. Blocks serve as the building blocks of the blockchain and provide a chronological order for the transactions.

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Learn how to retrieve blocks data using Chainstack.

Wallet

A wallet, in the context of cryptocurrencies, is a software application or a physical device that allows users to securely store, manage, and interact with their digital assets. It stores the private keys that are necessary to access and control the cryptocurrencies associated with those keys. Wallets enable users to send, receive, and manage their cryptocurrencies, and they come in various forms, including software wallets (desktop, mobile, or web-based) and hardware wallets (physical devices).

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Learn more about crypto wallets with our Wallets 101 series.

Nodes

In a blockchain network, a node refers to a computer or device that participates in the network by maintaining a copy of the blockchain, validating transactions, and relaying information to other nodes. Nodes play a crucial role in ensuring the security, integrity, and decentralization of the network. There are different types of nodes, including full nodes, archive nodes, and light nodes, each with varying levels of data storage and processing capabilities.

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Learn more about different type of nodes, and how to deploy your own node using Chainstack.

Consensus mechanism

Consensus mechanisms are algorithms or protocols used by blockchain networks to achieve agreement among network participants on the validity of transactions and the state of the blockchain. Consensus mechanisms enable decentralized networks to reach a shared truth without relying on a central authority.

Examples of popular consensus mechanisms include proof-of-work (PoW), where participants compete to solve complex mathematical problems to validate blocks (used mostly by Bitcoin), and proof-of-stake (PoS), where participants "stake" their coins to gain the right to validate blocks based on their stake (used by networks like Ethereum Post-Merge and Cardano).

Full nodes

Full nodes are blockchain nodes that maintain a complete copy of the blockchain's transaction history and validate each transaction and block according to the network's consensus rules. Full nodes independently verify the integrity of the blockchain and can relay transactions and blocks to other nodes, but they only store a limited amout of the blockchain states. They provide a high level of security and decentralization but require significant storage space and computational resources to operate.

Archive nodes

Archive nodes are a type of node that not only store the complete transaction history but also retain the historical state of the blockchain at any given point in time, starting from the genesis block. Archive nodes are useful for in-depth analysis, research, and retrieving historical data from the blockchain. They consume significant storage resources and are often used by researchers, analysts, and developers working with historical blockchain data.

Light nodes

Light nodes, also known as lightweight nodes or thin clients, are blockchain nodes that don't store the entire blockchain's transaction history. Instead, they only download and validate block headers, which contain summarized information about each block. Light nodes rely on full nodes or other trusted sources to access the complete blockchain data when necessary. Light nodes require fewer resources and can be run on devices with limited storage and computing power, making them more accessible for users who don't need to interact with the blockchain at a deep level.

Maximal extractable value

Maximal extractable value (MEV) refers to the potential additional value that miners or validators can extract from the process of ordering and including transactions in a block. Miners have the power to decide the order in which transactions are included and can prioritize transactions that benefit them financially. MEV arises from various activities, such as front-running, arbitrage opportunities, and transaction reordering. It has become a topic of interest and research in the blockchain community as it can affect fairness, market dynamics, and user experience.

Ethereum improvement proposal

Ethereum improvement proposals (EIPs) are formal documents that propose changes, enhancements, or new features to the Ethereum blockchain. EIPs define standards, protocols, and improvements to the core Ethereum protocol, client APIs, and contract standards. EIPs undergo a review process by the Ethereum community, including developers, researchers, and users, before they can be accepted and implemented.

Fork

In the context of blockchain, a fork occurs when a blockchain network undergoes a significant divergence, creating two or more separate chains with a shared history up to a certain point. There are two types of forks: soft forks and hard forks. A soft fork introduces backward-compatible changes that allow new rules while maintaining compatibility with old ones. In contrast, a hard fork introduces changes that are not backward-compatible, resulting in a permanent divergence of the blockchain. Forks can occur due to protocol upgrades, consensus changes, or disagreements within the community.

Proof of Staked Authority (PoSA)

Proof of Staked Authority (PoSA) is a hybrid consensus mechanism that combines aspects of Proof of Stake (PoS) and Proof of Authority (PoA). In PoSA, validators must hold a certain stake (PoS element) while being approved as a trusted node (PoA element). This aims to provide security by having validators risk both economic stake and reputation. PoSA is designed to be more decentralized than PoA while being more energy-efficient than Proof of Work. A potential risk is centralization if the validator set is not diverse enough. PoSA is used by the BNB Chain.

Proof-of-stake

Proof-of-stake (PoS) is a consensus mechanism used by blockchain networks to achieve agreement on the validity of transactions and create new blocks. In PoS, validators are chosen to create new blocks based on the amount of cryptocurrency they "stake" or lock up as collateral. The probability of being chosen to create a block is proportional to the validator's stake. PoS is considered an energy-efficient alternative to proof-of-work (PoW) as it eliminates the need for extensive computational work and reduces the environmental impact.

Proof-of-work

Proof-of-work (PoW) is a consensus mechanism used by blockchain networks, including Bitcoin and Ethereum pre-Merge, to validate and secure transactions. In PoW, miners compete to solve complex mathematical puzzles, requiring significant computational power. The first miner to solve the puzzle successfully verifies the transactions in a block and adds it to the blockchain. PoW ensures the security and immutability of the blockchain but requires substantial energy consumption and computational resources.

Ethereum virtual machine

The Ethereum virtual machine (EVM) is a runtime environment for executing smart contracts on the Ethereum blockchain. It is a decentralized, Turing-complete virtual machine that allows developers to write and deploy smart contracts in various programming languages. The EVM ensures that smart contracts on the Ethereum network behave consistently and securely by executing bytecode instructions.

Layer 1 blockchains

Layer 1 blockchain refers to the main blockchain network that serves as the foundation layer for a decentralized ecosystem. Examples of layer 1 blockchains include Ethereum, Avalanche, Fantom, Solana, and Aptos. These blockchains have their own consensus mechanisms, native currencies, and smart contract capabilities. Layer 1 blockchains handle the fundamental operations of transaction validation, block creation, and network security.

Layer 2 blockchains

Layer 2 blockchains are built on top of layer 1 networks and provide scalability solutions to improve transaction throughput and reduce fees. Layer 2 solutions, such as ZK rollups, enable off-chain computation and state-storage while leveraging the security and decentralization of the layer 1 blockchain. These solutions aim to alleviate congestion and enhance the scalability of layer 1 networks. Examples of layer 2 blockchains include Polygon, which is built on top of Ethereum, acting as a scaling solution.

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Learn more about layer 2 scaling solutions.

Faucet

A faucet is a tool or service that provides free tokens, typically on a testnet, to developers or users for testing and experimentation purposes. Web3 developers often require testnet tokens, such as test ether on the Ethereum network, to deploy and interact with their smart contracts without using real cryptocurrencies. Faucets distribute these testnet tokens, allowing developers to experiment with smart contract functionality without incurring any real-world financial costs.

You can take our own faucet as an example.

Validator

In a proof-of-stake (PoS) consensus mechanism, a validator is a participant who holds a stake or a certain amount of cryptocurrency in the network and is selected to propose and validate new blocks. Validators are responsible for verifying transactions, maintaining network security, and participating in the consensus process. By staking their tokens as collateral, validators have a financial incentive to act honestly and ensure the integrity of the blockchain network.

Difficulty

Difficulty refers to the level of complexity or computational effort required to mine or validate a new block in a proof-of-work (PoW) blockchain network. The difficulty is adjusted periodically to maintain a consistent block creation rate. As more miners join the network, the difficulty increases to ensure that new blocks are added to the blockchain at a consistent and predetermined rate. Difficulty adjustments help maintain the security and stability of the PoW blockchain network.

Gas

Gas is a unit of measurement representing the computational effort required to execute a transaction or perform an operation on a blockchain network. Gas is used to quantify the computational resources consumed by each transaction. When sending a transaction on the Ethereum network, users include a specified amount of gas to cover the computational cost of executing the transaction. Gas is priced in small denominations called gwei.

Gwei

Gwei is a denomination of ether on the Ethereum network. It stands for gigawei and represents one billionth of an ether. Gwei is commonly used to denote the price of gas, which determines the transaction fee on the Ethereum network. Gas prices are generally measured in gwei per unit of gas.

Gas limit

The gas limit refers to the maximum amount of gas a user is willing to pay for a specific transaction on the blockchain network. It represents the computational resources allocated to execute the transaction. The gas limit serves as a safety measure to prevent infinite loops or excessive resource consumption. If a transaction exceeds the specified gas limit, it will be automatically reverted, and the user will not be charged for the unused gas.

Gas war

A gas war occurs when there is high demand for block space on the blockchain, leading to increased competition among users to have their transactions included in the next block. Users bid higher gas fees to incentivize miners or validators to prioritize their transactions. As the competition intensifies, gas fees can rise significantly, resulting in a gas war. Gas wars often happen during periods of network congestion or when there is a surge in transaction activity.

Hash

A hash is an alphanumeric string, and it acts as a digital fingerprint. In the context of blockchain, hashes play a crucial role in confirming the integrity and immutability of data. Each block in a blockchain contains the hash value of the previous block, forming a chain. Any modification to the data of a previous block would result in a different hash value, making it evident that the blockchain has been tampered with.

Liquidity pool

A liquidity pool is a smart contract found on decentralized exchanges (DeXs) that enables users to contribute funds in the form of token pairs. Liquidity providers deposit amounts of different tokens into the pool, establishing a balanced liquidity reserve for those tokens. This pool allows other users to trade or swap between the tokens. Liquidity providers are incentivized to contribute by receiving a portion of the trading fees generated by the DeX, based on their share of the liquidity pool.

Liquidity providers

Liquidity providers are individuals or entities that deposit their tokens into a liquidity pool on a decentralized exchange. By doing so, they contribute liquidity to the pool, facilitating trading and swapping between different tokens for other users. Liquidity providers earn a proportionate share of the trading fees generated by the DeX as compensation for their contribution. Participating as a liquidity provider offers the opportunity to earn passive income while supporting the liquidity and functionality of decentralized finance (DeFi) platforms.

Mainnet

Mainnet refers to the primary network of a blockchain platform where real transactions occur and are permanently recorded on the distributed ledger. It is the live and operational version of the blockchain, as distinguished from testnets or development environments. For instance, the Ethereum Mainnet serves as the public blockchain network where users can engage with smart contracts, perform transactions with ether, and engage in various decentralized activities. Other blockchain networks, such as Binance Smart Chain and Polygon, also have their respective mainnets serving as the primary operational networks.

Mining

Mining involves validating and adding new blocks or transactions to a blockchain, typically executed in a proof-of-work (PoW) consensus mechanism. Miners employ powerful computers to solve complex cryptographic puzzles and find the nonce, which validates and verifies transactions. Upon successfully solving the puzzle, a miner adds a new block to the blockchain containing a set of verified transactions. Miners are rewarded for their computational efforts with incentives like newly created cryptocurrencies (e.g., Bitcoin) and transaction fees. In PoW-based blockchains, mining is crucial in upholding network security and confirming transaction integrity.

Sybil

In the context of blockchain and decentralized systems, a Sybil attack refers to a situation where a single entity or individual creates multiple identities or nodes on the network to gain a disproportionately large influence over the system. This can enable the attacker to subvert the consensus mechanism, disrupt the network, or carry out other malicious activities.

Sybil-resistant

A Sybil-resistant system or mechanism is designed to prevent or mitigate the effectiveness of Sybil attacks. A Sybil-resistant system makes it difficult or economically unfeasible for an attacker to create and maintain many identities or nodes on the network. This is typically achieved through various techniques, such as:

Proof-of-Work (PoW): In PoW-based blockchains like Bitcoin, creating new identities (mining nodes) requires significant computational power, which is an economic barrier to Sybil attacks.
Proof-of-Stake (PoS): In PoS-based blockchains, a node's influence is proportional to the amount of cryptocurrency (stake) held by its owner. Creating multiple identities with significant stakes is economically expensive, making Sybil's attacks less feasible.
Identity-based systems: Some blockchains use identity-based systems, where identities are tied to real-world identities or reputations, making it harder to create multiple anonymous identities.

Sybil resistance is an important consideration in the design of decentralized systems, as it helps to ensure the integrity and security of the network by preventing any single entity from gaining excessive influence or control.