APPENDIX

Block- a set of transactions that are bundled together and added to the chain and has a given number of transactions. Blocks hold valid transactions which are hashed and encoded into something called a Merkel tree.

Blockchain - a specific form or subset of DLT which constructs a chronological chain of blocks; a shared, immutable ledger for recording transactions, tracking assets and building trust. Many businesses are adopting the technology and will continue to find use cases for which it solves problems across firms. The blockchain database consists of two kinds of records: transactions and blocks. A blockchain transaction is a record of an event, cryptographically secured by a digital signature which is verified, ordered, and bundled together into blocks.

Consensus - Consensus in a network means the agreement between all the network participants as to the correct state of the data. The consensus algorithm ensures that the data on a ledger is the same for all the participant nodes and prevents malicious nodes from manipulating the data. Examples of this are PoW (Proof of Work) and PoS (Proof of Stake).

Cryptocurrency - virtual or digital money that takes the form of tokens or “coins” for which they do not rely on banks to verify or complete transactions. The term “crypto” refers to complicated cryptography that allows for creating and processing digital currencies and their transactions across decentralized systems, or a P2P network, anywhere in the world. Cryptocurrencies are typically developed as code by teams who build in mechanisms for issuance and other controls.

dApp - short for decentralized application, is a blockchain‐enabled website and smart contract which allows them to connect to the blockchain network. Typically, dApps are open source and store data cryptographically on the blockchain. Dapp users may feel more secure in the knowledge that the creators of the application cannot control how it is used.

DLT - also known as Distributed Ledger Technology, is a technological infrastructure which allows simultaneous access, validation, and record updating in an immutable manner across a multi-region network.

Immutability - the state of not changing, or being unable to be changed. It is extremely difficult to change a transaction in a blockchain, since each block is linked to the previous block.

Merkle Tree - also known as a binary hash tree, is a data structure which makes storing hashes of individual data in large datasets in a very efficient. It is a tamper-proof mechanism to ensure that large dataset hasn’t been changed.

Proof of Stake- validators explicitly stake capital in the form of a token into a smart contract on Ethereum’s blockchain or similar. This staked token then acts as collateral that can be destroyed if the validator behaves dishonestly or lazily. The validator is then responsible for checking that new blocks propagated over the network are valid and occasionally creating and propagating new blocks themselves.

Proof of Work - It requires a participant node to prove that the work done and submitted by them qualifies them to receive the right to add new transactions to the blockchain. This system requires somewhat significant amount of effort in order to deter frivolous or malicious uses of computing power, such as sending spam emails or launching denial of service attacks. The concept was subsequently adapted to securing digital money by Hal Finney in 2004 through the idea of "reusable proof of work" using the SHA-256 hashing algorithm.

P2P Network - a group of computers that are linked together with equal permissions and responsibilities for processing data. Each connected machine has the same rights as its “peers”, and can be used for the same purposes.

Smart Contract - a program stored on a blockchain that runs when predetermined conditions are met; a self-executing contract with the terms of the agreement between buyer and seller being directly written into lines of code. They typically are used to automate the execution of an agreement so that all participants can be immediately certain of the outcome, without any intermediary’s involvement or time loss.