The Crypto, AI, Blockchain Glossary, Shannon Style
Updated: Aug 13, 2021
A wee introduction to the relationship between Crypto-AI-Blockchain (CAB) as I currently understand it.
If we look back at the last 20 years, we could surmise that this period was driven by: Social, Mobile and Cloud. Three entities that seamlessly weaved into each other to give us what we have today.
If we look out to the coming 20 years, we could say this period will be driven by CAB. (I hope it’s ok I shorten Crypto-AI-Blockchain into this acronym - CAB - as I’ll be mentioning it a lot.)
Crypto-AI-Blockchain are three entities that are already weaving into each other to shape the new frontier, being dubbed Web 3.0
What follows is a list of all the different moving parts in this new frontier that combined, contribute to the Crypto, AI, Blockchain (CAB) revolution.
And thank you for letting this list not be perfect
this is a work in progress - that I expect I’ll be updating a few times before the year is out.
A Crypto AI Blockchain, (CAB) Glossary, for 6-year olds
Table of Contents:
click a word to go immediately. to that section of the glossary. ** fist bump **
A Crypto AI Blockchain, (CAB) Glossary, for 6-year olds
Accelerators - where startup founders go to get mentored, invested in (seed capital), and complete a fixed-term program to qualify, optimise and grow their small business. The accelerator offers the startup founder support to pitch their business to attract investors and generate brand awareness. A startup founder probably exchanges equity for access to the program. Usually happens once a startup founder has moved beyond the Incubator stage.
Accountants - the people who manage the books are now specialising in managing the crypto currency books for High Net Worth Individuals, Family Offices, Firms and the rest of us.
Asset Management - the people & systems who manage assets as a job. Some of those Asset Managers are specializing in crypto assets and digital assets.
Artificial Intelligence - this is an application that is used to get computers (machines) to solve problems by themselves. Machines solve problems by consuming tons of data - and processing it without any of the usual human limitations. Eg., machines are not limited by the human condition of the standard 5 senses, or the human’s belief systems, or the human’s unconscious bias.
Bitcoin - The Asset - Bitcoin is now a globally traded financial asset with daily settled volume measured in the tens of billions of dollars.
Bitcoin - the Network - can be compared to the Visa or Paypal network - as it gives you an identity out of the box, gives you payment specifications to work within, and a mechanism to transact. The bitcoin network is a peer-to-peer payment network that operates on a cryptographic protocol. Users send and receive bitcoins by broadcasting digitally signed messages to the network using bitcoin Crypto Wallet software.
Bitcoin Lightning Network - SWIFT, Visa, Paypal, Square, and Mastercard. The Bitcoin lightning network seeks to remove the up to 10-minute lag for all users regardless of geography, and minus the costs Mastercard and Visa charge.
Visa provides 4,000 transactions per second, and can scale to a maximum of 65,000 transactions per second.
Bitcoin can handle up to 7 transactions per second with the current blocksize of 1MB; not very scalable so the blockchain community solved the problem so it doesn’t have to scale - the lightning network allows everyday transactions to be stored in an off-chain system, freeing up space (keeping it faster).
Blockchain - a vast, new frontier type of a ledger that keeps track of everything. Blockchain is a decentralized network of computers that records and stores data to display a chronological series of events on a transparent and immutable ledger system.
At the core of blockchain is this; easy to understand, public transactions that offers full transparency over all transactions. Each transaction is unique. Cross Reference if you like.
Picturing Blockchain - a Canadian analogy!
Consider that the 5 great Canadian lakes are the size of the blockchain database. Each of the 5 lakes carries a unique part of the Blockchain.
I’m using the 5 great lakes to illustrate that blockchain databases are plural- and take your information and divide up the data across multiple locations.
Blockchain is a network ... as opposed to what you and I have become accustomed to; one single database, siloed. Blockchain is not a singular anything, rather a network that works together.
It improves security - and boasts of reducing hacks. For example,
If you want to hack my data in the blockchain network, you will need to hack the entire 5 great lakes to get to me because my data is stored in different parts of each of the 5 lakes.
What's more - those 5 Great Lakes are open to us all.
We all access and share the 5 great lakes of data; consider that when we do, our moves are transparent, uniquely documented, and contributing to the tonnage of data that we need to feed machines to help them get better at problem solving (with support from AI).
Blockchain holds, organises and stores; smart contracts, ledgers, and well, personal data - in pieces all over the 5 Great Lakes.
This is still an analogy - your data is not literally stored in water. Heh.
Blockchain Projects are in the thousands, here's a tiny look at what they are up to:
Blockchain supply chain management platform - add sensors to your products using RFID so that when scanned, they get logged into the blockchain, making counterfeit way more difficult. Or letting you see for-reals - where your shrimp came from, where your coffee, timber, seafood and minerals came from.
Healthcare - Health Wallets - this tool combines AI, blockchain and big data to holistically manage a patient's data
Civil Infrastructure - Finalize has paired AI and Blockchain to automate and speed up construction industry workflow, management and verification processes, and its technology also integrates with wearables to meet safety regulations.
CoinGenius - is an AI-driven cryptocurrency trading platform that gives crypto traders AI-based scoring systems, high-quality data feeds and advanced forecasting so they can personalize news and trading features to maximize their efforts.
AlphaNetworks is a blockchain-powered entertainment platform that uses AI to enhance audience analytics and viewership algorithms. The combination of AI and blockchain powers the company’s “Proof-of-Engagement” (POE) tools that automatically trigger payments to content providers based on views and engagement times.
NetObjex is a smart city infrastructure platform that uses AI, blockchain and IoT to power everything from connected devices to cloud-based products. The combination of these technologies reportedly improves logistics tracking, real-time failure detection and data and device authentication.
Card Providers/Issuers - Crypto cards are essentially regular debit or credit cards where you can purchase goods with real-time crypto to FIAT conversion. Usually, crypto exchanges or platforms will partner with payment networks (e.g., Visa, Mastercard) to let customers instantly convert their crypto holdings into FIAT to make purchases in Point of Sales (PoS) from merchants that support those networks.
CoinMap is a cool tool for locating crypto currency merchants and ATMS around the world.
Centralised Crypto Exchanges - centralised kind of means - there’s a middle man to help conduct transactions, safely. Buyers and sellers alike trust this middle man to handle their assets.
The reason for this setup is that banks offer security and monitoring that an individual cannot accomplish on his or her own.
In the case of a centralized cryptocurrency exchange, the same principle applies. Transactors trust not only that the exchange will safely complete their transactions for them, but also that it will make use of the network of users in the exchange in order to find trading partners.
In the case of cryptocurrencies, which are often stored in digital wallets, an individual can lose hundreds or thousands of dollars in digital currency holdings simply by forgetting the key to a wallet. An exchange will not allow this to happen, as it safeguards the holdings in place of the individual investor.
Centralized exchanges can be used to conduct trades from fiat to cryptocurrency (or vice versa). They can also be used to conduct trades between two different cryptocurrencies. While this may seem to cover all of the potential transaction types, there is still a market for another type of cryptocurrency exchange as well
Crowd Funding - Currently, there are different methods in Crowdfunding Such as:
and now crypto crowdfunding
Crypto Assets - A crypto asset (cryptocurrency) is part of digital currencies (all electronic money). Digital currencies are intangible e-money, sometimes regulated, sometimes unregulated. Among digital currencies, we count cryptocurrencies and virtual currencies.
Crypto Wallets - In short, a crypto wallet is a wallet that you can use to interact with a blockchain network. Crypto wallets allow you to buy, sell, store and manage your transactions, as well as monitor your crypto asset balances. which is not technically a wallet. It is a pair of keys - well, keys that are made up of hexadecimal numbers.
You have two categories of wallets: Hot and Cold Wallets
Hot Wallets: A hot wallet is any wallet that is connected permanently to the internet.
You have your choice of:
Web based wallets - require a browser interface
Desktop wallets - downloadable software program that can be installed on your computer
Mobile Wallet - similar to desktop wallets, but they work as an application on your smartphone.
Cold Wallets: A cold wallet doesn’t require internet connectivity to work and allows you to store your crypto assets offline, you have your choice of:
Paper Wallet: A paper wallet, as its name suggests, is a piece of paper that you print out on which all the information required to access your funds is recorded (usually in the form of QR codes). These codes can then be scanned to execute cryptocurrency transactions.
Hardware wallet: these ones take the form of physical electronic devices (like a USB key) on which information to access your funds is encrypted: neither you nor anyone else can access them. This device has an OLED screen and side buttons to navigate through the wallet’s interface.
Hardware wallets come with native desktop apps for different cryptocurrencies and can connect to a PC or mobile device via USB or bluetooth. Currently, most hardware wallets allow you to set up a PIN code to protect your device, as well as a recovery phrase – which can be used in case your wallet is lost.
Hardware wallets are very popular thanks to their high level of security. However, they can be expensive, complex to handle, and don’t offer the best user experience.
Crypto Insurance - think of cryptocurrency insurance as a subcategory of general liability insurance. It protects the insured against the loss of crypto due to online theft. The policy can include an interchangeable limit that increases or decreases in reaction to the value fluctuations of crypto assets.
Crypto Lending - Crypto lending is lending purely based on cryptocurrency like Bitcoin, AltCoin, Doge, Ether.
Crypto Security - Cryptosecurity is a component of communications security that deals with the creation and application of measures leading to secure ciphers and codes, which are used to protect encryption systems and methods from enemy discovery, decryption, interception and tampering.
Cryptography - From the Greek Term, Kryptos and graphein, which means hidden and to write - Its origins date back to circa 1900 BC as hieroglyphics in an Egyptian Tomb. Today, Cryptography is the science of securing information by transforming it into a form that only intended recipients can process and read.
Cryptocurrency: This is an algorithm powered currency used as tokens in select online communities and backed by certain technologies, assets or projects. They can be used for mostly peer to peer payments, and a few for direct, real-life transactions.
Their value is often determined by demand, supply, and algorithmic parameters. These have their own self-regulating networks and ecosystems, are decentralized, and aren’t reliant on third parties like banks to function and execute transactions. They can be converted from one token to another e.g. bitcoin to ethereum, and used for various purposes. The most popular use of cryptos –short for cryptocurrency- though, is as a store of value. So, you buy, hold until it appreciates in value, and sell. Depending on your goals, you can do this short, medium or long term. There are professionals who trade the currencies every day, and retail investors who buy and hold for the future.
Crypto Exchange allows people to swap crypto tokens using established intermediaries.
Decentralised is based largely on it being peer-to-peer, sharing with anyone and everyone. No silos, no middle man. This makes it possible for all of us to access the data, use the data and make better data.
Decentralised Exchanges (DeEx) allows people to swap crypto tokens directly with each other. Peer-to-Peer
Decentralised Finance - In general - Peer-to-Peer Finance. a system by which financial products become available on a public decentralized blockchain network, making them open to anyone to use, rather than going through middlemen like banks or brokerages. You do not need a government-issued ID, Social Security number, or proof of address to use DeFi. More specifically, DeFi refers to a system by which software written on blockchains makes it possible for buyers, sellers, lenders, and borrowers to interact peer to peer or with a strictly software-based middleman rather than a company or institution facilitating a transaction.
Decentralised Wallets - The decentralized wallet app allows users to add, access, and manage multiple wallets, view live market prices, review your recent transactions and HODL, and transfer all your digital assets from a single XRP wallet address. There is usually no intervention of any middleman during the transaction.
Decentralised ID - DecIDS Imagine you move to a new country and need to register for all kinds of services: voting, driver’s license, banking, electricity, entertainment subscriptions. Right now, you have to register individually with each service provider and prove your identity to open an account. And every time you want to access this account, you need to prove your identity again, either by password or other credentials. A decentralized identity radically simplifies this process. You prove your identity once to a trusted third party and store the proof of your identifier in an ITF. The ITF and its related infrastructure (i.e., decentralized identity network, services and verifiable claim exchange protocols) stand between you and your service providers and handle all requests for identity and access.
Digital Currency - the parent name for all non-physical monies - electronic money. While you cannot touch it physically, you can actually use the “money” to pay for services, buy goods and carry out transactions.
Digital Trading Platforms - a parent term for Crypto Exchanges. Digital trading platforms exchange digital currencies (crypto, bitcoin, and electronic monies).
FIAT currency - Government backed paper currency whose value is set/maintained by the respective government. (USD? US Government) It is not backed by commodities such as gold. Controlled by the Central Banks - we get into trouble when the governments print too much of it as when they do - we find ourselves swimming inside hyperinflation.
Incubators - if startup accelerators grow your business. Incubators qualify your business idea. A group of people with strong networks across finance and business, help individuals with great ideas get started by supporting them with funding, access to their networks, and coaching.
Initial Coin Offering (ICO) - the crypto equivalent of the IPO. It’s new! This is primarily a capital-raising activity in the cryptocurrency and blockchain world. The ICO can be compared to an initial public offering (IPO) but with cryptocurrencies. You can have a Private ICO, or a Public ICO. ICO and Regulatory authorities approach to regulating ICOs vary around the world, with China and South Korea banning them outright. There are some published regulatory guidelines available from Australia, New Zealand, Hong Kong, and the United Arab Emirates (UAE).
(Crypto) Investment Funds - a place to invest in decentralized networks and projects that build blockchain-related services, their tokens, and crypto collectibles.
Law Firms - we know who these guys are. And it won’t surprise anyone that there are Law Firms specialising in Crypto, Blockchain and AI.
Media - Media that is Crypto specific. Kind of like www.cryptocurryclub.com
Mining, as in Mining for Minerals - Mining in the cryptocurrency industry is the process of building the blockchain - slowly adding data as users make transactions on the network. It involves hard math called hashing (carried out by computers) Overtime it accumulates resources.
Journalists - Journalists specialised in covering Crypto, Blockchain and AI - Like Jillian Godsil.
Off Ramping - borrowing from the highway analogy. on-ramps assist you in getting onto the crypto highway, and off-ramps assist you in getting off the crypto highway again. Crypto currency becomes FIAT currency.
On Ramping - borrowing from the highway analogy. on-ramps assist you in getting onto the crypto highway, and off-ramps assist you in getting off the crypto highway again. FIAT currency becomes cryptocurrency.
Payment Service Providers (PSP) - offers merchants the support they need to access electronic payments, from credit cards, digital wallets, and more. PayPal and Stripe are payment service providers.
Pair - A (currency) pair is a price quote of the exchange rate for two different currencies traded in FX markets. We can now pair FIAT currency with Crypto currency.
Portfolio Management - a mash up of science & art involved with selecting and then overseeing a group of investments that are expected to meet long-term financial objectives while considering the risk tolerance of the client.
Portsmouth, New Hampshire - Anarchists, rebels and wild ones - this wee US town has 24 businesses that take crypto. In 1864 Portsmouth was home to 3 police officers, 120 bars and 30 brothels. Portsmouth rallies very few cities for being the most cryptocurrency-friendly city in the world on a per capita basis. They've dubbed themselves Crypto Mecca. See for yourself...
Regulators - same Regulators - organizing themselves accordingly to accommodate this emerging world. We have (USA) Regulatory bodies such as:
Then in the Euro zone we have an alphabet soup of Regulators, including:
European System of Financial supervision (the ESFS)
European Systemic Risk Board (ESRB)
European Supervisory Authorities (ESAs)