Blockchain/Distributed

Ledger Working Group

Glossary
The permanent and official location for Blockchain/Distributed Ledger Working Group is https://
cloudsecurityalliance.org/group/blockchain/

© 2016 Cloud Security Alliance – All Rights Reserved

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Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 2
Acknowledgements

Cloud Security Alliance

Hillary Baron, Research Analyst
Stephen Lumpe, Graphic Design

Blockchain/Distributed Ledger Working Group

Michael Roza, Project Lead
Arvind Tiwari, Co-Chair
Sabri Khemissa, Co-Chair
Ashish Mehta, Co-Chair

The Blockchain/Distributed Ledger Working Group (BDL) was formed to research

blockchain’s security implications. Blockchain is a radical, evolving technology and there is
little awareness or knowledge regarding security aspects or compliance implications among
many technical and business communities. This glossary plus other relevant information
is a collective contribution of the BDL Working Group to blockchain security awareness,
and includes a compilation of common terms and other information used in the world of
blockchain.

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 3
51% attack A theoretical situation where a single miner or group of miners controls
(aka Consensus more than half of the networks computing power and decides to use this
HiJacking) power to their advantage. The attacker can double spend his money –
meaning he can pay with the same Bitcoin twice or even more. The attacker
will also be able to prevent transactions from being confirmed and prevent
other miners from generating new Bitcoins.

Source: https://99bitcoins.com/bitcoin-glossary-faq/

Address Addresses (Cryptocurrency addresses) are used to receive and send

transactions on the network. An address is a string of alphanumeric
characters, but can also be represented as a scannable QR code. To
create the address, the wallet pushes the public key through a series of
cryptographic algorithms

Source: http://www.blockchaintechnologies.com/blockchain-glossary
Source: https://blockgeeks.com/guides/blockchain-address-101/

Agreement An agreement ledger is distributed ledger used by two or more parties to

Ledger negotiate and reach agreement.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Altcoin A General name given to cryptocurrencies other than Bitcoin. For example,
Litecoin, Feathercoin, Dash, etc. For a list of many Altcoin go to
http://www.altcoins.com.

Source: https://99bitcoins.com/bitcoin-glossary-faq/

Attestation A distributed ledger providing a durable record of agreements, commitments

Ledger or statements, providing evidence (attestation) that these agreements,
commitments or statements were made.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 4
Bitcoin Block Contains a standard 80 bytes of information as follows:
Header
Bytes Name Description

4 version Block version information

32 hashprevblock The hash value of the previous block
32 hashmerkleroot Merkle tree collection - a hash of all transactions
related to current block
4 time A timestamp recording when a block was created
4 bits The calculated difficulty target being used for a block
4 nonce Number used to allow header variations and compute
different hashes

Source: https://en.bitcoin.it/wiki/Block_hashing_algorithm

Bitcoin is a digital asset designed to work as a medium of exchange using

Currency cryptography to secure the transactions and to control the creation of
additional units of the currency. Cryptocurrencies are a subset of alternative
currencies, or specifically of digital currencies.

Bitcoin became the first decentralized cryptocurrency in 2009. Since then,

numerous cryptocurrencies have been created. These are frequently called
altcoins, as a blend of bitcoin alternative. Bitcoin and its derivatives use
decentralized control as opposed to centralized electronic money/centralized
banking systems. The decentralized control is related to the use of bitcoin’s
blockchain transaction database in the role of a distributed ledger.

Source: https://en.wikipedia.org/wiki/Cryptocurrency and https://en.wikipedia.

org/wiki/Bitcoin

Bitcoin BTC most common currency code. XBT unofficial ISO currency code
Currency Units
Value in @ $100 per @ $200 per @ $500 per
Unit
BTC/XBT BTC/XBT BTC/XBT BTC/XBT

BTC 1 $100 $200 $500

mBTC 0.001 $0.10 $0.20 $0.50
uBTC 0.000001 $0.000100 $0.000200 $0.000500
Satoshi 0.00000001 $0.000001 $0.000002 $0.000005

Source: http://bitcoinchaser.com/bitcoin-units-and-denominations

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 5
Bitcoin is peer-to-peer with transactions taking place between users directly,
Payment without an intermediary. These transactions are verified by network nodes
and recorded in a public distributed ledger called the blockchain, which
System
uses bitcoin as its unit of account. Since the system works without a central
repository or single administrator, the U.S. Treasury categorizes bitcoin as a
decentralized virtual currency. Bitcoin is often called the first cryptocurrency,
although prior systems existed and it is more correctly described as the first
decentralized digital currency. Bitcoin is the largest of its kind in terms of
total market value.

Source: https://en.wikipedia.org/wiki/Bitcoin

Bitcoin The Bitcoin transaction lock time is the time at which a particular transaction
Transaction can be added to the blockchain. This is the earliest time that miners can
include the transaction in their hashing of the Merkle root to attach it in the
Locktime
latest block to the blockchain.There are two specific types of transaction
locktime. Firstly when the locktime figure is less than 500 million it is
interpreted as a block height and miners therefore have to wait until that block
height has been reached before attempting to include it in a block. If it is above
500 million it is converted to a unix timestamp – a unix timestamp being the
number of seconds since January 1st 1970.

Source: https://www.cryptocompare.com/coins/guides/what-is-bitcoin-
transaction-locktime/

Bitcoin randomly crisscrosses your bitcoins with other users’ bitcoins so that you get
Tumbler/Mixer a clean address that the blockchain cannot connect with any of the addresses
from which the coins were stolen. The tumbler is only accessible through the
anonymizing Tor network, making it difficult for law enforcement to trace traffic
to it or discover the people behind it.

Source: http://www.theverge.com/2013/12/19/5183356/how-to-steal-bitcoin-
in-three-easy-steps

Bitcoin Vanity is a customized variant of a normal Bitcoin address. The customization

Addres occurs after the first character which is always 1. For example
1BITCOINanmgjh567bh457jj5tUyJgh5. Customization can be performed a
third party Vanity Address Issuer such as https://vante.me/#!/order/start.
However, research the 3rd Party issuer as some have been reported to be
scammers. Alternatively, software can be downloaded to a local computer so
that the Vanity Address can be self issued. Note that the computational effort
necessary to generate the address is significant. The BITCOIN Vanity Address

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 6
 example above could take 1 week to generate.

Source: https://en.bitcoin.it/wiki/Bitcoin_Vanity_Generation_Website and

https://en.bitcoin.it/wiki/Vanitygen

Block A group of transactions. Each block has a reference to the previous block and
that is how a “blockchain” is built. Mining is the process that actually builds the
blockchain. Because of this there is no way for someone to tamper with the
system and add their own “custom” block to the chain.

Source: https://99bitcoins.com/bitcoin-glossary-faq/

Block Explorer Block Explorer is an open source web tool that allows you to view information
about blocks, addresses, and transactions on the Bitcoin blockchain. The
source code is on GitHub.

Source: https://blockexplorer.com/

Block Height Block height refers to the number of blocks connected together in the block
chain. For example, Height 0, would be the very first block, which is also called
the Genesis Block.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Blockchain Originally block chain — is a distributed database that maintains a

continuously-growing list of ordered records called blocks. Each block
contains a timestamp and a link to a previous block. By design blockchains are
inherently resistant to modification of the data — once recorded, the data in
a block cannot be altered retroactively. Blockchains are “an open, distributed
ledger that can record transactions between two parties efficiently and in a
verifiable and permanent way. The ledger itself can also be programmed to
trigger transactions automatically.

Source: https://en.wikipedia.org/wiki/Blockchain_(database)

Blockchain 1.0 is currency - the deployment of cryptocurrencies in applications related to

cash such as currency transfer, remittance, and digital payment systems.

Source: https://ieet.org/index.php/IEET2/more/swan20141110

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 7
Blockchain 2.0 is contracts - the whole slate of economic, market, and financial applications
using the blockchain that are more extensive than simple cash transactions
like stocks, bonds, futures, loans, mortgages, titles, smart property, and
smart contracts.

Source: https://ieet.org/index.php/IEET2/more/swan20141110

Blockchain 3.0 is applications beyond currency, finance, and markets, particularly in the areas
of government, health, science, literacy, culture, and art.

Source: https://ieet.org/index.php/IEET2/more/swan20141110

Blockchain A blockchain application requires three interdependent components: the user-

Applications facing application, the smart contract, and the ledger.
The top layer is the user-facing application that meets the needs of the
network participants. The application lets users invoke smart contracts that
trigger transactions in the business network. The smart contract encapsulates
the business logic of the network: assets, ownership, and transfers. Each
invocation of a smart contract creates a transaction in the network and
updates the ledger. The ledger holds the current value of smart contract data
(for example, vehicleOwner=Daisy), and is distributed across the network.

Source: http://www.ibm.com/developerworks/cloud/library/cl-blockchain-
basics-glossary-bluemix-trs/index.html

Blockchain as a is providing a platform to develop, test, and deploy blockchain applications.

Service (BaaS)
Source: https://azure.microsoft.com/en-us/solutions/blockchain/

“Blockchain Total Cloud Market Share Blockchain as a Blockchain (Distributed

Cloud Service Provider
as a Service” all services Jan 2016 Service (BaaS) Ledger) Technology

Providers Microsoft Azure 9% Yes Ethereum

IBM Bluemix 7% Yes Hyperledger fabric
Amazon Web Services 31% Yes Ethereum
Google 4% Yes Ripple
Rest 49%
Total 100%

Source: https://www.channele2e.com/2016/02/04/cloud-market-share-2016-
aws-microsoft-ibm-google/

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 8
Blockchain writes chaincode (smart contracts), and client-side applications to invoke
Developer smart contracts. The Blockchain Developer could deploy chaincode directly
to the network, through a REST interface. To include credentials from a
Traditional Data source in chaincode, the developer could use an out-of-
band connection to access the data.

Source: https://console.ng.bluemix.net/docs/services/blockchain/
ibmblockchain_overview.html

Blockchain Embedded mining is a relatively new concept where mining chips are
Embedded embedded into internet connected devices. In comparison to industrial grade
mining hardware (e.g. servers in a data center), embedded mining chips can
Mining
operate inside everyday devices such as a cell phone. Embedded mining
is speculated to be a solution to previously uneconomical efforts, such as
micropayments and monetizing the internet-of-things.

Source: http://www.blockchaintechnologies.com/blockchain-mining

Blockchain a hash function takes an input of any length and creates an output of fixed
Hash length. The output is called a Hash. SHA256 is a hash function that takes any
length input and creates an output of 256 bits (32 bytes). A Blockchain Hash
is calculated for each block in a chain with the hash for the first block used as
input when calculating the hash for the next block.

Source: https://decentralize.today/if-you-understand-hash-functions-youll-
understand-blockchains-9088307b745d#.lh2gflo8c

Blockchain Mining refers to the distributed computational review process performed

Mining on each “block” of data in a “block-chain”. This allows for achievement of
consensus in an environment where neither party knows or trusts each other.

Source: http://www.blockchaintechnologies.com/blockchain-mining

Blockchain CPU/GPU Bitcoin Mining: The least powerful category of bitcoin mining
Mining hardware is your computer itself. Theoretically, you could use your computer’s
CPU to mine for bitcoins, but in practice, this is so slow by today’s standards
Hardware
that there isn’t any point. You can enhance your bitcoin hash rate by adding
graphics hardware to your desktop computer. Graphics cards feature
graphical processing units (GPUs). These are designed for heavy mathematical
lifting so they can calculate all the complex polygons needed in high-end video

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 9
 games. This makes them particularly good at the SHA hashing mathematics
necessary to solve transaction blocks. For example, an ATI 5970 graphics card
can give you over 800 MH/sec compared with a CPU, which will generally give
you less than 10 MH/sec.

FPGA Bitcoin Mining: A Field Programmable Gate Array is an integrated

circuit designed to be configured after being built. This enables a mining
hardware manufacturer to buy the chips in volume, and then customize them
for bitcoin mining before putting them into their own equipment. Because
they are customized for mining, they offer performance improvements over
CPUs and GPUs. Single-chip FPGAs have been seen operating at around 750
Megahashes/sec, although that’s at the high end.
ASIC Bitcoin Miners: This is where the action’s really at. Application Specific
Integrated Circuits (ASICs) are specifically designed to do just one thing: mine
bitcoins at mind-crushing speeds, with relatively low power consumption.
Because these chips have to be designed specifically for that task and then
fabricated, they are expensive and time-consuming to produce - but the
speeds are stunning. At the time of writing, units are selling with speeds
anywhere from 5-500 Gigahashes/sec (although actually getting some of them
to them to ship has been a problem).

Source: http://www.coindesk.com/information/how-to-set-up-a-miner/

Blockchain •• A distributed, decentralized peer-to-peer network, with nodes that

Network represent network participants, such as banks, government agencies,
manufacturers and securities firms.
•• A group of peers that validate transactions through a consensus protocol
before committing them to a shared ledger.

Source: http://www.ibm.com/developerworks/cloud/library/cl-blockchain-
basics-glossary-bluemix-trs/index.html

Blockchain manages member permissions, such as enrolling the Regulator (B) as an

Network “auditor” and the Blockchain User (A) as a “client.” An auditor could be
restricted to query transactions, whereas a client could be authorized to
Operator
deploy, invoke and query certain types of chaincode.

Source: https://console.ng.bluemix.net/docs/services/blockchain/
ibmblockchain_overview.html

Blockchain It is not required for most fully validating nodes to store the entire blockchain,
Pruning currently around 127 GB. Reducing the amount of data to the size of the

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 10
 current unspent output size, currently 1.7 GB, plus some additional for data
that is needed to handle re-orgs can reduce the stress on many nodes.

Source: https://en.bitcoin.it/wiki/Scalability and https://statoshi.info/

dashboard/db/unspent-transaction-output-set

Blockchain Due to the existence of multiple copies of the entire transaction database
RTBF Risk it would be difficult to prove all data had been deleted. The fact that data
in the blockchain is immutable – which means that it cannot be altered or
removed once it has been entered – provides transparency and accountability.
However, it may also compromise privacy and data protection, especially when
it comes to personal or sensitive data (which should never be stored on a
blockchain). Blockchains do not guarantee anonymity and, the more personal
the data is, the easier it is to identify the individual to which it pertains. This
immutability may compromise the ‘right to be forgotten’, whereby users may,
under certain circumstances, demand that their personal data be erased.

Source: https://www.enisa.europa.eu/publications/blockchain-security and

http://www.europarl.europa.eu/thinktank/en/document.html?reference=EPRS_
IDA(2017)581948

Blockchain As of bitcoin core 0.9, transactions from the network must match a set of
Standard rules, Those transactions are called standard transactions. Only standard
transactions are mined or broadcast by peers running the default Bitcoin
Transaction
Core software. The standard transaction types are as follows:
Types
1. Pay to PubKey Hash (P2PKH) - standard way to send Bitcoins to a single
address
2. Pay to Address - standard way of assigning newly mined Bitcoins and
transaction fees to an address
3. Pay to Script Hash (P2SH) - moves the responsibility for supplying the
conditions to redeem a transaction from the creator of the transaction
to the payee(s)
4. Multi-Signature - used for multi-signature transactions by specifying the
multi-signature script in the P2SH (#3) redeemScript, they can also be
specified directly in the scriptPubKey
5. Null_Data - They allow the creator of the transaction to include some
arbitrary data in the blockchain in exchange for paying a transaction fee.
The output is unspendable
6. Non_Standard – None of the above

Source: http://www.quantabytes.com/articles/a-survey-of-bitcoin-transaction-
types and https://bitcoin.org/en/developer-guide#standard-transaction

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 11
Blockchain submits a transaction to the Permissioned Blockchain network. The
User transaction can be a deploy, invoke or query, and is issued through a client-
side application leveraging an SDK, or directly through a REST API.

Source: https://console.ng.bluemix.net/docs/services/blockchain/
ibmblockchain_overview.html

BTC is still the most often used code for Bitcoin and is listed on https://www.oanda.
com/currency/converter/ as well as in the form of a trust on http://www.
nasdaq.com/symbol/gbtc that invests in Bitcoin. XBT is the unofficial ISO 4217
International Standard for currency codes. You can find XBT traded on https://
www.bloomberg.com/quote/COINXBT:SS and http://www.xe.com.

Source: http://www.coindesk.com/bitcoin-gaining-market-based-legitimacy-xbt/

Central Ledger A central ledger refers to a ledger maintained by a central agency.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Chaincode Chaincode is the Hyperledger fabric’s interpretation of the smart contract

method/algorithm, with additional features. Embedded logic that encodes the
rules for specific types of network transactions. Developers write chaincode
applications and deploy them to the network. End users then invoke
chaincode through a client-side application that interfaces with a network
peer, or node. Chaincode runs network transactions, which if validated, are
appended to the shared ledger and modify world state.

Source: https://console.ng.bluemix.net/docs/services/blockchain/
ibmblockchain_overview.html

Chaincode Chaincode Services provides a secure and lightweight method to sandbox

Services chaincode execution on the validating nodes. The environment is a “locked
down” and secured container, along with a set of signed base images
containing secure OS and chaincode language, runtime and SDK layers for Go,
Java and Node.js. Additional languages can be enabled, if required.

Source: https://console.ng.bluemix.net/docs/services/blockchain/
ibmblockchain_overview.html

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 12
Chaincode The standard transaction types are as follows:
Standard
1. Init () - when you first deploy your chaincode. This should be used to
Transaction
initialize your chaincode.
Types
2. Invoke () - when you want to call chaincode functions to do real work
3. Query () - whenever you query your chaincode’s state.
4. Main () – when it’s time to setup the communication between the
chaincode & the peer that deployed it.

Source: https://github.com/IBM-Blockchain/learn-chaincode

Chainwashing is the purposeful and sometimes deceptive attempt by a vendor or

entrepreneur to rebrand or hype a product or service by associating the
buzzword “Blockchain” with it.

Source: http://bitcoinist.com/chainwashing-r3-swanson-blockchain-hype/

Cloudwashing is the purposeful and sometimes deceptive attempt by a vendor or

entrepreneur to rebrand or hype a product or service by associating the
buzzword “Cloud” with it.

Source: http://searchcloudstorage.techtarget.com/definition/cloud-washing

Confirmation A confirmation means that the blockchain transaction has been verified by the
network. This happens through a process known as mining, in a proof-of-work
system (e.g. Bitcoin). Once a transaction is confirmed, it cannot be reversed
or double spent. The more confirmations a transaction has, the harder it
becomes to perform a double spend attack.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Consensus A consensus algorithm, does two things: it ensures that the next block in a
Algorithms/ blockchain is the one and only version of the truth through agreement of
participants, and it keeps powerful adversaries from derailing the system and
Protocols
successfully forking the chain. Some of the better known protocols are: Proof
of Work (Pow), Proof of Stake (PoS), Proof of Activity (PoA), Proof of Burn (PoB),
Proof of Elapsed Time (PoET), Proof of Capacity (PoC).

Source: http://www.coindesk.com/short-guide-blockchain-consensus-protocols/

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 13
Consensus A point – either in time, or defined in terms of a set number or volume of
Point records to be added to the ledger – where peers meet to agree the state of
the ledger.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Consortium a consortium blockchain is a blockchain where the consensus process is

blockchains controlled by a preselected set of nodes; for example, one might imagine a
consortium of 15 financial institutions, each of which operates a node and
of which 10 must sign every block in order for the block to be valid. The right
to read the blockchain may be public, or restricted to the participants, and
there are also hybrid routes such as the root hashes of the blocks being
public together with an API that allows members of the public to make a
limited number of queries and get back cryptographic proofs of some parts
of the blockchain state. These blockchains may be considered “partially
decentralized”.

Source: https://blog.ethereum.org/2015/08/07/on-public-and-private-
blockchains/

Contract Contracts are written in high level language and deployed in byte code. The
Accounts address of a contract is determined at the time the contract is created (it is
derived from the creator address and the number of transactions sent from
(Ethereum)
that address, the so-called “nonce”).

Source: http://solidity.readthedocs.io/en/develop/introduction-to-smart-
contracts.html#accountsibmblockchain_overview.html

Cryptocurrency is a digital asset designed to work as a medium of exchange using

cryptography to secure the transactions and to control the creation of
additional units of the currency. Cryptocurrencies are a subset of alternative
currencies, or specifically of digital currencies.

Source: https://en.wikipedia.org/wiki/Cryptocurrency

Cryptographic such as the SHA256 computational algorithm, produce a fixed-size, unique

Hashes hash value, known as a digest, from variable-sized transaction input. Hashes
feature a mathematical property in which a hash can be arrived at uniquely
from a given input, but the input cannot be derived from its hash value. A given
specific input always results in the same hash value being computed.

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 14
 Any modifications or alterations to transaction input — even the most
minuscule change — results in a different hash value being computed, which
indicates potentially compromised transaction input. Thus, the hash value can
be used to detect the integrity of the transaction input.

Source: http://www.ibm.com/developerworks/cloud/library/cl-blockchain-
basics-glossary-bluemix-trs/index.html

Decentralized are a type of software program designed to exist on the Internet in a way that is
Apps (DAPPS) not controlled by any single entity. For an application to be considered a Dapp it
must meet the following criteria:

Application must be completely open-source - It must operate autonomously,

and with no entity controlling the majority of its tokens. The application may
adapt its protocol in response to proposed improvements and market feedback
but all changes must be decided by consensus of its users.

Application’s data and records of operation must be cryptographically stored - in

a public, decentralized blockchain in order to avoid any central points of failure.

Application must use a cryptographic token - (bitcoin or a token native to its

system) which is necessary for access to the application and any contribution of
value from (miners /farmers) should be rewarded in the application’s tokens.

Application must generate tokens - according to a standard cryptographic

algorithm acting as a proof of the value nodes are contributing to the application
(Bitcoin uses the Proof of Work Algorithm).

Source: https://blockchainhub.net/dapps/

Difficulty in Proof-of-Work mining, is how hard it is to verify blocks in a blockchain

network. In the Bitcoin network, the difficulty of mining adjusts verifying blocks
every 2016 blocks. This is to keep block verification time at ten minutes.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Digest Access It is a general purpose protocol for authentication that provides integrity
Authentication protection through use of simple authentication and security layer (SASL).
Uses include:
•• Authenticated client access to a Web site
•• Authenticated client access using SASL
•• Authenticated client access with integrity protection to a directory service

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 15
 Using LDAP

Source: https://technet.microsoft.com/en-us/library/cc778868(v=ws.10).aspx

Digital A digital commodity is a scarce, electronically transferrable,intangible, with a

Commodity market value.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Distributed database in which storage devices are not all attached to a common
Database processor. It may be stored in multiple computers, located in the same
physical location; or may be dispersed over a network of interconnected
computers. Unlike parallel systems, in which the processors are tightly coupled
and constitute a single database system, a distributed database system
consists of loosely coupled sites that share no physical components.

Source: https://en.wikipedia.org/wiki/Distributed_database

Distributed (also called shared ledger or register) a consensus of replicated, shared,

Ledger and synchronized digital data geographically spread across multiple sites,
countries, or institutions. There is no central administrator or centralized
data storage. A peer-to-peer network is required as well as consensus
algorithms to ensure replication across nodes is undertaken. One distributed
ledger design is through implementation of a public or private blockchain
system. But all distributed ledgers do not have to necessarily employ a chain
of blocks to successfully provide secure and valid achievement of distributed
consensus, a Blockchain is only one type of data structure considered to be
a distributed ledger.

Source: https://en.wikipedia.org/wiki/Distributed_ledger

DLT is the ability of the continuingly increasing number of heterogeneous DLT

Interoperability Systems as well as legacy non DLTs Systems to interact with each other.

Source: http://www.hkma.gov.hk/media/eng/doc/key-functions/finanical-
infrastructure/Whitepaper_On_Distributed_Ledger_Technology.pdf

Double Double spend refers to a scenario, in the Bitcoin network, where someone
Spending tries to send a bitcoin transaction to two different recipients at the same time.

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 16
 However, once a bitcoin transaction is confirmed, it makes it nearly impossible
to double spend it. The more confirmations that a particular transaction has,
the harder it becomes to double spend the bitcoins.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

ECDSA is a signature algorithm that is a variant of DSA (Digital Signature Algorithm)

Signatures that like Schnorr Signatures leverages elliptic curve cryptography. Unlike
Schnorr, ECDSA requires one signature for each input sent from each
individual address.

Source: https://en.wikipedia.org/wiki/Elliptic_Curve_Digital_Signature_
Algorithm and https://bitcoinmagazine.com/articles/the-power-of-schnorr-the-
signature-algorithm-to-increase-bitcoin-s-scale-and-privacy-1460642496/

Elliptic Curve is a public key encryption technique based on elliptic curve theory that can
Cryptography be used to create faster, smaller, and more efficient cryptographic keys.
ECC generates keys through the properties of the elliptic curve equation
instead of the traditional method of generation as the product of very large
prime numbers.

Source: http://searchsecurity.techtarget.com/definition/elliptical-curve-
cryptography

Ether is the name of the currency used within Ethereum. It is used to pay for
computation within the EVM. A list of exchanges where Ether is traded can be
found at coinmarketcap.com

Source: http://ethdocs.org/en/latest/ether.html

Double Ethereum is a programmable open blockchain. Rather than give users a set
Spending of predefined operations (e.g. bitcoin transactions), Ethereum allows users
to create their own operations of any complexity they wish. In this way, it
serves as a platform for many different types of decentralized blockchain
applications, including but not limited to cryptocurrencies. At the heart
of it is the Ethereum Virtual Machine (“EVM”), which can execute code of
arbitrary algorithmic complexity. In computer science terms, Ethereum is
“Turing complete”. Developers can create applications that run on the EVM
using friendly programming languages modelled on existing languages like
JavaScript and Python

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 17
 Source: http://ethdocs.org/en/latest/introduction/what-is-ethereum.html

External Ethereum Virtual Machine, has concept of External Accounts which are
Accounts given to the external entities (e.g. Humans). External accounts are created
with public-private key pair and the account ID is derived from public
(Ethereum)
key. Account ID is used in transaction messages to address owner and
destination of transactions.

Source: http://solidity.readthedocs.io/en/develop/introduction-to-smart-
contracts.html#accounts

Fiat Currency Legal tender that has been designated as such by government. This requires
that the public has confidence and faith in the government and the money’s
ability to serve as a storage medium for purchasing power.

Source: http://www.dummies.com/personal-finance/investing/how-the-fiat-
system-works/

Fork a regular fork where all nodes follow the same consensus rules, so the fork
is resolved once one chain has more proof of work than another. When two
or more blocks have the same block height, forking the block chain. Typically
occurs when two or more miners find blocks at nearly the same time. Can also
happen as part of an attack.

Source: https://bitcoin.org/en/glossary/soft-fork

Genesis Block The very first block in a blockchain.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

ECDSA Bitcoins have a finite supply, which makes them a scarce digital commodity. The
Signatures total number of bitcoins that will ever be issued is 21 million. The number of bitcoins
generated per block (Block Reward) is decreased 50% every four years. This is called
“halving.” Currently the reward is 12.5 Bitcoins. The next haling in 2020 will drop
the reward to 6.25 per block. The final halving will take place in the year 2140. The
countdown to the final halving can be monitored at http://www.bitcoinblockhalf.com/

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 18
HardFork A permanent divergence in the blockchain, commonly occurs when non-
upgraded nodes can’t validate blocks created by upgraded nodes that follow
newer consensus rules. A hardfork is a change to the blockchain protocol that
makes previously invalid blocks/transactions valid, and therefore requires all
users to upgrade their clients. The most recent example of a hardfork in public
blockchains is the Ethereum hardfork which happened on July 21st 2016.
The hardfork changed the Ethereum protocol, therefore second blockchain
emerged (Ethereum Classic, ETC) which supports the old Ethereum protocol.
In order to continue existing ETC needs miners, which would validate the
transactions on the blockchain.

Source: https://bitcoin.org/en/glossary/hard-fork and https://blockchainhub.

net/glossary/

Digital The number of hashes that can be performed by a bitcoin miner in a given
Commodity period of time (usually a second).

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Hashrate The denomination of hash rates follows the International System of Units (SI).
Denominations kilo-, mega-, giga-, tera-, peta-, exa-

1 kH/s 1,000 (one thousand) hashes per second

1 MH/s 1,000,000 (one million) hashes per second
1 GH/s 1,000,000,000 (one billion) hashes per second
1 TH/s 1,000,000,000,000 (one trillion) hashes per second
1 PH/s 1,000,000,000,000,000 (one quadrillion) hashes per second
1 EH/s 1,000,000,000,000,000,000(one quintillion) hashes per second

Source: http://molinn.is/.crypt/btc-e/WalletBitcoinMining/bitcoin-mining-
conversion.php

Hyperledger The Hyperledger project is an open source collaborative effort created to

advance cross-industry blockchain technologies. It is a global collaboration
including leaders in finance, banking, Internet of Things, supply chains,
manufacturing and Technology. The Linux Foundation hosts Hyperledger as a
Collaborative Project under the foundation. There are currently 5 projects in
progress, Blockchain Explorer, Cello, Fabric, IROHA, Sawtooth Lake.

Source: https://www.hyperledger.org/ and https://www.hyperledger.org/

community/projects

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 19
Intel® is an Intel technology for application developers who are seeking to protect
Software Guard select code and data from disclosure or modification. Intel SGX makes such
protections possible through the use of enclaves, which are protected
Extensions
areas of execution. Application code can be put into an enclave by special
(SGX)
instructions and software made available to developers via the Intel® SGX
Software Development Kit (SDK). The Intel SGX SDK is a collection of APIs,
libraries, documentation, sample source code, and tools that allows software
developers to create and debug Intel SGX.

Source: https://software.intel.com/en-us/sgxcommunity/projects

Interledger The Interledger Protocol provides for routing payments across different
Protocol (ILP) digital asset ledgers while isolating senders and receivers from the risk of
intermediary failures. Secure multi-hop payments and automatic routing
enables a global network of networks for different types of value that can
connect any sender with any receiver.

Source: https://interledger.org/rfcs/0003-interledger-protocol/#preface

Litecoin A peer-to-peer cryptocurrency based on the Scrypt proof-of-work network.

Sometimes referred to as the silver of bitcoin’s gold.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Membership Membership Services manages user identities on a permissioned

Services blockchain network through the Certificate Authority peer. Membership
Services provides a distinction of roles by combining elements of Public
Key Infrastructure (PKI) and decentralization (consensus). By contrast,
non-permissioned networks do not provide member-specific authority or a
distinction of roles.

A permissioned blockchain requires entities to register for long-term

identity credentials (Enrollment Certificates), which can be distinguished
according to entity type. For users, an Enrollment Certificate authorizes the
Transaction Certificate Authority (TCA) to issue pseudonymous credentials;
these certificates authorize transactions submitted by the user. Transaction
certificates persist on the blockchain, and enable authorized auditors to
associate otherwise unlinkable transactions.

Source: https://console.ng.bluemix.net/docs/services/blockchain/
ibmblockchain_overview.html

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 20
Merged Mining Merged mining is the process of allowing two different crypto currencies
based on the same algorithm to be mined simultaneously. This allows low
hash powered crypto currencies to increase the hashing power behind their
network by bootstrapping onto more popular crypto currencies. Two of the
best examples of this are scrypt mining of both litecoin and dogecoin, as well
as namecoin and bitcoin with sha-256.

Source: https://www.cryptocompare.com/mining/guides/what-is-merged-
mining-bitcoin-namecoin-litecoin-dogecoin/

Merkle Root The root node of a Merkle tree, a descendant of all the hashed pairs in the
tree. Block headers must include a valid Merkle root descended from all
transactions in that block.

Source: https://bitcoin.org/en/glossary/merkle-root

Merkle Tree Basic idea behind Merkle tree is to have some piece of data that is linking
to another. You can do this by linking things together with a cryptographic
hash. The content itself can be used to determine the hash. By using the
cryptographic hashing, we can address the content, and content gets
immutable because if you change anything in the data the cryptographic
hash changes and the link will be different. Bitcoin uses cryptographic
hashing, where every block points to the previous one, if you modify the
block, the hash will change and will make the block invalid.

Source: https://blockchainhub.net/glossary/

Miner refers to the person/entity that performs a computational review process

on each “block” of data in a “blockchain” before a block is considered
confirmed/approved.

Source: http://www.blockchaintechnologies.com/blockchain-mining

Mining The process by which transactions are verified and added to a blockchain.
This process of solving cryptographic problems using computing hardware
also triggers the release of cryptocurrencies.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 21
Mining Pool where the miner pools resources with other miners to find blocks more
often, with the proceeds being shared among the pool miners in rough
correlation to the amount of hashing power they each contributed, allowing
the miner to receive small payments with a lower variance (shorter time
between payments).

Source: https://bitcoin.org/en/developer-guide#mining

Mining Solo where the miner attempts to generate new blocks on his own, with the
proceeds from the block reward and transaction fees going entirely to himself,
allowing him to receive large payments with a higher variance (longer time
between payments)

Source: https://bitcoin.org/en/developer-guide#mining

Multi Signature Multi-signature (multisig) addresses allow multiple parties to require more
than one key to authorize a transaction. The needed number of signatures is
agreed at the creation of the address. Multisignature addresses have a much
greater resistance to theft.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Nakamoto is the decentralized mechanism for emergent consensus. Emergent, because

Consensus consensus is not achieved explicitly—there is no election or fixed moment
when consensus occurs. Instead, consensus is an emergent artifact of the
asynchronous interaction of thousands of independent nodes, all following
simple rules. Decentralized consensus emerges from the interplay of four
processes that occur independently on nodes across the network:

•• Independent verification of each transaction, by every full node, based on

a comprehensive list of criteria
•• Independent aggregation of those transactions into new blocks by mining
nodes, coupled with demonstrated computation through a proof-of-work
algorithm
•• Independent verification of the new blocks by every node and assembly
into a chain
•• Independent selection, by every node, of the chain with the most
cumulative computation demonstrated through proof of work

Source: http://chimera.labs.oreilly.com/books/1234000001802/ch08.html

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 22
Node Each copy of the ledger operated by a participant in the blockchain network.
Entries in the ledger are synchronized to all ledgers in the network.

Source: http://www.ibm.com/developerworks/cloud/library/cl-blockchain-
basics-glossary-bluemix-trs/index.html

Nonce is an arbitrary number used only once in a cryptographic communication,

in the spirit of a nonce word. They are often random or pseudo-random
numbers. Many nonces also include a timestamp to ensure exact timeliness,
though this requires clock synchronization between organizations. The
addition of a client nonce (“cnonce”) helps to improve the security in some
ways as implemented in digest access authentication. To ensure that a nonce
is used only once, it should be time-variant (including a suitably fine-grained
timestamp in its value), or generated with enough random bits to ensure
a probabilistically insignificant chance of repeating a previously generated
value. Some authors define pseudo-randomness (or unpredictability) as a
requirement for a nonce.

Source: https://en.wikipedia.org/wiki/Cryptographic_nonce

NXT Nxt is an advanced open source application platform which builds on

and improves the basic functionality of the first wave of pioneering
cryptocurrencies. The Nxt platform includes many advanced features,
including the NXT digital currency. Nxt gives its users complete freedom in
many ways: for example, to use the NXT currency as a payment system, or to
create advanced blockchain applications using the Nxt API and toolkit. Nxt is
a powerful, open and completely decentralized application platform, leading
the evolution of cryptocurrency into blockchain technology.

Source: https://nxt.org/what-is-nxt/

Off-Ledger A currency minted off-ledger and used on-ledger. An example of this would
Currency be using distributed ledgers to manage a national currency such as EUR.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

On-Ledger A currency minted on-ledger and used on-ledger. An example of this would
Currency be the cryptocurrency, Bitcoin.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 23
Open- This is a collaborative effort to develop a robust, commercial-grade,
Transactions fully-featured, free-software toolkit implementing the OTX protocol as
well as a full-strength financial cryptography library, API, GUI, command-
Project
line interface, and prototype notary server. The project is managed
by a worldwide community of volunteers that use the Internet to
communicate, plan, and develop the Open-Transactions toolkit and its
related documentation.

Source: http://opentransactions.org/wiki/index.php?title=Main_Page

Orphan Block Detached or Orphaned blocks are valid blocks which are not part of the main
chain. They can occur naturally when two miners produce blocks at similar
times or they can be caused by an attacker (with enough hashing power)
attempting to reverse transactions.

Source: https://blockchain.info/orphaned-blocks

Participant An actor who can access the ledger: read records or add records.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Peer An actor that shares responsibility for maintaining the identity and integrity
of the ledger.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Peer-to-Peer Peer-to-peer (P2P) refers to the decentralized interactions that happen

Transaction between at least two parties in a highly-interconnected network. P2P
participants deal directly with each other through a single mediation point.
Platforms
Source: http://www.blockchaintechnologies.com/blockchain-glossary

Pegged is the creation of another blockchain to be used to transfer Bitcoins and

Sidechains assets from one blockchain to another. Several advantage of Pegged
Sidechains are:

1. Access to new and innovative cryptocurrency systems using the assets

they already own
2. More easily interoperate with each other and with Bitcoin

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 24
 3. Avoiding the liquidity shortages and market fluctuations associated with
new currencies
4. Since sidechains are separate systems, technical and economic
innovation is not hindered
5. Despite bidirectional transferability between Bitcoin and pegged
sidechains, they are isolated:
a. in the case of a cryptographic break (or malicious design) in a
sidechain, the damage is entirely confined to the sidechain itself.

Source: https://blockstream.com/sidechains.pdf

Permissioned A permissioned ledger is a ledger where actors must have permission to

Ledger access the ledger. Permissioned ledgers may have one or many owners.
When a new record is added, the ledger’s integrity is checked by a limited
consensus process. This is carried out by trusted actors which makes
maintaining a shared record much simpler that the consensus process
used by unpermissioned ledgers. Permissioned block chains provide
highly-verifiable data sets because the consensus process creates a digital
signature, which can be seen by all parties. A permissioned ledger is usually
faster than an unpermissioned ledger.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Private a fully private blockchain is a blockchain where write permissions are

Blockchain kept centralized to one organization. Read permissions may be public
or restricted to an arbitrary extent. Likely applications include database
management, auditing, etc. internal to a single company, and so public
readability may not be necessary in many cases at all, though in other cases
public auditability is desired.

Source: https://blog.ethereum.org/2015/08/07/on-public-and-private-
blockchains/

Private Key A private key is a string of data that shows you have access to bitcoins in a
specific wallet. Private keys can be thought of as a password; private keys
must never be revealed to anyone but you, as they allow you to spend the
bitcoins from your bitcoin wallet through a cryptographic signature.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 25
Proof of Proof-of-Authority is a replacement for Proof-of-Work, which can be used
Authority (PoA) for private chain setups. It does not depend on nodes solving arbitrarily
difficult mathematical problems, but instead uses a hard-configured set of
“authorities” - nodes that are explicitly allowed to create new blocks and
secure the blockchain. This makes it easier to maintain a private chain and
keep the block issuers accountable. A Proof of authority is a consensus
mechanism in a private blockchain which essentially gives one client (or a
specific number of clients) with one particular private key the right to make
all of the blocks in the blockchain.

Source: https://github.com/ethcore/parity/wiki/Proof-of-Authority-Chains and

https://blockchainhub.net/glossary/

Proof-of-Stake An alternative to the proof-of-work system, in which your existing stake in

(PoS) a cryptocurrency (the amount of that currency that you hold) is used to
calculate the amount of that currency that you can mine.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Proof-of-Work A system that ties mining capability to computational power. Blocks must be
(PoW) hashed, which is in itself an easy computational process, but an additional
variable is added to the hashing process to make it more difficult. When a
block is successfully hashed, the hashing must have taken some time and
computational effort. Thus, a hashed block is considered proof of work.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Public is a blockchain that anyone in the world can read, anyone in the world can
Blockchain send transactions to and expect to see them included if they are valid, and
anyone in the world can participate in the consensus process – the process
for determining what blocks get added to the chain and what the current
state is. As a substitute for centralized or quasi-centralized trust, public
blockchains are secured by cryptoeconomics – the combination of economic
incentives and cryptographic verification using mechanisms such as proof of
work or proof of stake, following a general principle that the degree to which
someone can have an influence in the consensus process is proportional
to the quantity of economic resources that they can bring to bear. These
blockchains are generally considered to be “fully decentralized”.

Source: https://blog.ethereum.org/2015/08/07/on-public-and-private-
blockchains/

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 26
QR Code A QR code in the case of a Bitcoin transaction is the machine-readable
representation of the transactors bitcoin address. The QR code is a more
efficient and effective method of transferring between parties the the 27
to 34 characters that make up a bitcoin address. The QR code also has the
possibility to display other information such as the amount of the transaction.

Source: https://bitcoin.stackexchange.com/questions/8111/what-are-qr-
codes-and-how-do-you-use-them-as-request-payment-from-wallet and
https://en.wikipedia.org/wiki/QR_code

Replicated A ledger with one master (authoritative) copy of the data, and many slave (non-
Ledger authoritative) copies.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Ripple A financial solution built around an open, neutral protocol (Interledger

Protocol or ILP) to power payments across different ledgers and networks
globally. It offers a cryptographically secure end-to-end payment flow with
transaction immutability and information redundancy. Architected to fit
within a bank’s existing infrastructure, Ripple is designed to comply with
risk, privacy and compliance requirements. Ripple is a consortium based
blockchain implementation.

Source: https://ripple.com/technology/

Schnorr is a signature algorithm replacement for ECDSA, leveraging elliptic curve

Signatures cryptography that supports “native multisig” which enables the aggregation
of multiple signatures into a single one valid for the sum of the keys of their
respective inputs. This algorithm has 3 significant benefits:

•• Constant-size signatures irrespective of the number of participants in the

multisig setup.
•• Diminished size of data to be validated and transmitted translates into
capacity gains.
•• Entire policy of multisig is obscured and indistinguishable from a
conventional single pubkey.

Source: https://bitcoincore.org/en/2017/03/23/schnorr-signature-
aggregation/

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 27
Script is a simple programming language, which is evaluated from left to right
using a stack. The language is designed such that it guarantees all scripts will
execute in a limited amount of time (it is not Turing-Complete).

A script is essentially a list of instructions recorded with each transaction

that describe how the next person wanting to spend the Bitcoins being
transferred can gain access to them. The script for a typical Bitcoin transfer
to destination Bitcoin address D simply encumbers future spending of the
bitcoins with two things: the spender must provide:

1. a public key that, when hashed, yields destination address D embedded

in the script, and
2. a signature to show evidence of the private key corresponding to the
public key just provided.

Source: https://bitcore.io/api/lib/script and https://en.bitcoin.it/wiki/Script

Scrypt An alternative proof of work system to SHA256, designed to be particularly

friendly to CPU and GPU miners, while offering little advantage to ASIC miners.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Segregated is where data, or more specifically data related to signatures are removed
Witness from bitcoin transactions making them smaller in size. This in turn makes
the blocks smaller meaning more transactions can be included in a block.
(Segwit)
Technically, “Segregated witness (Segwit) is a soft fork that, if activated, will
allow transaction-producing software to separate (segregate) transaction
signatures (witnesses) from the part of the data in a transaction that is
covered by the txid.”

Source: https://decentralize.today/segregated-witness-explained-like-im-5-
c00a8994ea7c#.k3fic6d7n

SHA 256 The SHA (Secure Hash Algorithm) is one of a number of cryptographic hash
functions. A cryptographic hash is like a signature for a text or a data file.
SHA-256 algorithm generates an almost-unique, fixed size 256-bit (32-byte)
hash. Hash is a one way function – it cannot be decrypted back. This makes it
suitable for password validation, challenge hash authentication, anti-tamper,
digital signatures. SHA-256 is one of the successor hash functions to SHA-1,
and is one of the strongest hash functions available.

Source: http://www.xorbin.com/tools/sha256-hash-calculator

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 28
Sharding In a sharding, nodes hold a subset of the state (UTXOs), and a subset of the
blockchain. Instead of miners/validators redundantly doing the same work,
they are going share the load but still have an only economic assurance
even though they’re not going to validate every transaction. For example, a
sharding scheme on Ethereum might put all addresses starting with 0x00
into one shard, all addresses starting with 0x01 into another shard, etc. In a
simple version of the scheme, each user maintains a light client on all shards,
while validators fully download and track a few shards that they are assigned
to at some particular time.

Source: https://diyhpl.us/wiki/transcripts/scalingbitcoin/sharding-the-
blockchain/ and https://github.com/ethereum/wiki/wiki/Sharding-FAQ

Shared Ledger The shared ledger is the single source of truth, or the entire history of
validated transactions, on a blockchain network. Any discrepancies in the
shared ledger across nodes are resolved through consensus. The ledger has
the following attributes:
•• It records all validated transactions on the network.
•• It is shared across all network participants.
•• It is replicated, so that each participant has their own copy.
•• It is permissioned, so that participants can only view their own
transactions.

Source: http://www.ibm.com/developerworks/cloud/library/cl-blockchain-
basics-glossary-bluemix-trs/index.html

Signature is a set of mathematical rules that link the private key, public key and signature
Scheme together. Examples are Schnorr and ECDSA.

Source: https://bitcoinmagazine.com/articles/the-power-of-schnorr-the-
signature-algorithm-to-increase-bitcoin-s-scale-and-privacy-1460642496/

Simple is a technique described in Satoshi Nakamoto’s paper. SPV allows a

Payment lightweight client to verify that a transaction is included in the Bitcoin
blockchain, without downloading the entire blockchain. The SPV client only
Verification
needs download the block headers, which are much smaller than the full
(SPV)
blocks. To verify that a transaction is in a block, a SPV client requests a proof
of inclusion, in the form of a Merkle branch.

Source: https://bitcoin.org/bitcoin.pdf

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 29
Smart Contract (also called self-executing contracts, blockchain contracts, or digital
contracts) are simply computer programs that act as agreements where
the terms of the agreement can be preprogrammed with the ability to self-
execute and self-enforce itself. The main goal of a smart contract is to enable
two anonymous parties to trade and do business with each other, usually
over the internet, without the need for a middleman. The origin and history
of smart contracts is much older than bitcoin and dates back to the 1990’s.
The term ‘smart contract’ was first coined in 1993 by one of bitcoin’s alleged
creators, Nick Szabo, and referred to self-automated computer programs
that can carry out the terms of any contract.

Source: http://www.blockchaintechnologies.com/blockchain-smart-
contracts#smart-contract-explained

SoftFork A SoftFork is a change to the bitcoin protocol wherein only previously valid
blocks/transactions are made invalid. Since old nodes will recognize the new
blocks as valid, a SoftFork is backward-compatible.

Source: https://bitcoin.org/en/glossary/soft-fork

Solidity Solidity is a contract-oriented, high-level language whose syntax is similar to

that of JavaScript and it is designed to target the Ethereum Virtual Machine
(EVM). Solidity is statically typed, supports inheritance, libraries and complex
user-defined types among other features.

Source: http://solidity.readthedocs.io

SPV (Simplified Simplified Payment Verification. A Bitcoin protocol feature that is usually
Payment implemented in wallets. It allows the creation of “lightweight” wallet clients
- wallets that don’t need to download the whole blockchain in order to
Verification)
operate. This makes it possible to install SPV wallets on mobile phones and
other space limited devices.

Source: https://bitcoin.org/en/glossary/simplified-payment-verification

Swarm Swarm is a distributed storage platform and content distribution service, a native
base layer service of the Ethereum web 3 stack. The primary objective of Swarm
is to provide a decentralized and redundant store of Ethereum’s public record, in
particular to store and distribute Dapp code and data as well as block chain data.

Source: http://swarm-gateways.net/bzz:/theswarm.eth/

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 30
Tainted % The taint percent for a bitcoin is the amount of correlation between two
Bitcoin addresses. In other words, how likely the two addresses are related.

Source: https://blockchain.info/taint/1dice6GV5Rz2iaifPvX7RMjfhaNPC8SXH

Timestamp Cryptocurrencies can serve as decentralized trusted timestamping services

Blockchain if hash values of digital data are embedded into the transactions recorded
in the block chain of the crypto currency. When a user submits a file or
plain text through the browser, a client-side Javascript hashes the data.
Alternatively, the data can be hashed offline, e.g., using an open source
tool. In either case, only the hash, not the data is transmitted to the server.
Then a bitcoin transaction, using the smallest amount possible, is created
that includes the document hash. By processing the transaction, the hash
and the timestamp of the transaction are permanently embedded in the
distributed Bitcoin block chain. The timestamp of confirmed transactions and
the data they encode can be verified by inspecting the Bitcoin block chain,
e.g. using websites like blockchain.info.

Source: https://www.gipp.com/wp-content/papercite-data/pdf/gipp15a.pdf
and https://app.originstamp.org/home

Timestamp Initially, the original data is hashed. Hashing authenticates the exact data
Trusted content, because the hash function ensures that changing a single bit in
the data would generate a different hash value. The hash is then transmitted
to a TSA, which joins the hash with a plain text timestamp. The resulting string,
i.e. the hash combined with the timestamp, is hashed once more and digitally
signed using the TSA’s private key. The resulting ciphertext represents the
trusted timestamp, which, together with the plain text timestamp, is returned
to the requester. The validity of the trusted timestamp can be verified by
decoding the ciphertext using the public key of the TSA. To verify that some data
is identical to the data authenticated by the TSA, the process of creating the
trusted timestamp has to be replicated and the results have to be compared to
the decoded trusted timestamp. The need for a central TSA is a weakness of
established timestamping approaches, since the integrity of the timestamping
process is inevitably bound to the integrity of the TSA (Adams et al., 2001).

Source: https://www.gipp.com/wp-content/papercite-data/pdf/gipp15a.pdf

Tokenless A tokenless ledger refers to a distributed ledger that doesn’t require a native
Ledger currency to operate.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 31
Tokens Asset- Asset backed tokens are claims on an underlying asset.
Backed
Source: https://bitsonblocks.net/2015/09/28/a-gentle-introduction-to-digital-
tokens/#more-130

Tokens Intrinsic (also known as ‘native or ‘built-in’ tokens) are made-up resources that have
some utility. Bitcoin for example. Even though they are traded there is no
claim to an asset.

Source: https://bitsonblocks.net/2015/09/28/a-gentle-introduction-to-digital-
tokens/#more-130

Traditional a data system that already exists which may impact the behavior of smart
Data Source contracts.

Source: https://www.docdroid.net/zNAiO8Z/exploring-hyperledger-
applications.pdf.html

Transaction A request by a transactor to execute a function on the blockchain

network. The transaction types are deployed, invoked, and queried, which
are implemented through the chaincode functions set forth in the fabric’s
API contract.

Source: https://console.ng.bluemix.net/docs/services/blockchain/
ibmblockchain_overview.html

Transaction A collection of transactions on the bitcoin network, gathered into a block that
Block can then be hashed and added to the blockchain.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Transaction Fee A small fee imposed on some transactions sent across the bitcoin network.
The transaction fee is awarded to the miner that successfully hashes the block
containing the relevant transaction.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 32
Transactions A transaction that has been added to the blockchain and is irreversible.
Confirmed
Source: https://blockchain.info/wallet/bitcoin-faq
(CTXNs)

Transactions It means that the transaction has not yet been included in the blockchain,
Unconfirmed and is still reversible. A transaction typically takes around 10 minutes to be
confirmed. When that happens, it is said that one confirmation has occurred
(UTXNs)
for the transaction. With each subsequent block that is found, the number
of confirmations is increased by one. To protect against double spending, a
transaction should not be considered as confirmed until a certain number of
confirmations is seen.

Source: https://blockchain.info/wallet/bitcoin-faq

Transactor A network participant connected to the blockchain network through a node,

who submits transactions from a client using an SDK or API.

Source: https://console.ng.bluemix.net/docs/services/blockchain/
ibmblockchain_overview.html

Trusted a trusted third party that issues timestamps. These timestamps prove when
Stamping data existed (e.g. contracts, medical records, and prevents backdating by
the data’s owners. Blockchain does not need TSAs because transactions are
Authority (TSA)
included in blocks which are generated every 10 minutes (on average) and
you get a block’s timestamp for all its transactions.

Source: https://blog.signatura.co/using-the-blockchain-as-a-digital-signature-
scheme-f584278ae826

Turing A machine is Turing complete if it can perform any calculation that any other
Completeness programmable computer is capable of. All modern computers are Turing-
complete in this sense. The Ethereum Virtual Machine (EVM) which runs on the
Ethereum blockchain is Turing complete. Thus, it can process any “computable
function”. It is, in short, able to do what you could do with any conventional
computer and programming language.

Source: https://blockchainhub.net/glossary/

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 33
Unpermissioned Unpermissioned ledgers such as Bitcoin have no single owner — indeed,
(Permissionless) they cannot be owned. The purpose of an unpermissioned ledger is to allow
anyone to contribute data to the ledger and for everyone in possession of
Ledgers
the ledger to have identical copies. This creates censorship resistance, which
means that no actor can prevent a transaction from being added to the ledger.
Participants maintain the integrity of the ledger by reaching a consensus about
its state dynamically in real-time.

Source: http://www.blockchaintechnologies.com/blockchain-glossary

Unspent Bitcoin phrase for output or the amount that is sent through a standard
Transaction transaction to a Bitcoin address with a set of rules to unlock the output amount.
Output (UTXO)
Source: https://www.cryptocoinsnews.com/bitcoin-transaction-really-works/

User Agent user agent fields embedded in the each node’s software contain information
related to the version and codebase the nodes are using. These fields are
exchanged between 2 nodes anytime contact is made. By reading and
summarizing these fields for all nodes a conclusion can be reached regarding
the health of the network. For Example: Node 1: /Satoshi:5.64/bitcoin-qt:0.4/
Node 2: /Satoshi:5.12/Spesmilo:0.8/. Both nodes use the same protocol
version of Bitcoin software but they use different versions of the codebase.

Source: http://libbitcoin.dyne.org/doc/network.html and https://github.com/

bitcoin/bips/blob/master/bip-0014.mediawiki

User-facing- The top layer is the user-facing application that meets the needs of the
application network participants. The application lets users invoke smart contracts that
trigger transactions in the business network.

Source: http://www.ibm.com/developerworks/cloud/library/cl-blockchain-
basics-glossary-bluemix-trs/index.html

Validating Peer A network node that runs the consensus protocol for the network to validate
transactions and maintain the ledger. Validated transactions are appended
to the ledger, in blocks. If a transaction fails consensus, it is purged from
the block and therefore, not written to the ledger. A validating peer (VP) has
authority to deploy, invoke and query chaincode.

Source: https://console.ng.bluemix.net/docs/services/blockchain/
ibmblockchain_overview.html

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 34
Virgin Bitcoin All bitcoins start out as virgins, and stay that way until the second they are
moved to another address. When new bitcoins are mined, they are noted on
the blockchain in the first transaction in a block. This is called the coinbase
transaction, (nothing to do with the popular bitcoin wallet coinbase). These
bitcoins are always created by a miner, and they include a single coinbase (or
coinbase field) as the sole input for coinbase transactions. The purpose of the
coinbase is to allow the miner who solved the block to claim the block reward,
which is currently 12.5 bitcoins.

Source: https://ihb.io/2015-07-30/news/virgin-bitcoins-8248

Wallet DDOS A DDOS attack can be made by using wallets, of which there are an estimated
12.8 million wallet users, pushing spam transactions to a targeted network.
Denial of service results from increased processing due to the nodes verifying
the validity of the transactions.

Source: https://www.enisa.europa.eu/publications/blockchain-security and

https://blockchain.info/charts/my-wallet-n-users

Wallet A bitcoin wallet that uses a physical piece of hardware in order to operate and
Hardware keep it more secure. Examples of hardware wallets are TREZOR, LedgerWallet
and Keepkey. A hardware wallet is usually more secure since it’s considered to
be a form of cold storage.

Source: https://99bitcoins.com/bitcoin-glossary-faq/

Wallet Hot Any Bitcoin wallet that is connected to the Internet. Hot wallets are
considered far less secure than cold storage since they can be hacked easier
due to their connectivity.

Source: https://99bitcoins.com/bitcoin-glossary-faq/

Weak Key Risk is the risk that the Key generation method used is faulty allowing the
attacker to duplicate the key gaining access to the objective (wallet,etc.).
For example a poor random number generator (RNG) can create the same
‘random’ number on more than one occasion. When the transaction is
hashed, this number is multiplied by the same generator point (ie: same
random number) as the public key. Since one unknown has been removed
from the equation, the private key can be revealed by effectively reversing
the hash through additional mathematical operations.

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 35
 Source: https://www.enisa.europa.eu/publications/blockchain-security and
http://www.coindesk.com/open-source-tool-identifies-weak-bitcoin-wallet-
signatures/

Wei “Sathosi” is the smallest unit of coin in Bitcoin blockchain system, likewise “Wei”
is the smallest unit in Ethereum coin, which is equal to 0.000000000000000001
ether (1 Ether = 1000000000000000000 Wei). There are other units as well
wei, Kwei, Mwei, szabo, finney, Kether, Mether, Gether and Tether.

Source: http://ether.fund/tool/converter

World State Key-value database used by chaincodes to store their state when executed
by a transaction.

Source: https://console.ng.bluemix.net/docs/services/blockchain/
ibmblockchain_overview.html

XBT is the unofficial ISO 4217 currency code. ISO 4217 is the International
Standard for currency codes. You can find XBT traded on https://www.
bloomberg.com/quote/COINXBT:SS and http://www.xe.com. BTC is still the
most often used code for Bitcoin and is listed on https://www.oanda.com/
currency/converter/ as well as in the form of a trust on http://www.nasdaq.
com/symbol/gbtc that invests in Bitcoin.

Source: http://www.coindesk.com/bitcoin-gaining-market-based-legitimacy-xbt/

Zero are transactions that are not yet included in a block. They reside in the miners
Confirmation memory pool. Once included in a block and written to the block chain the
transaction has one confirmation.
Transaction
Source: https://www.cryptocoinsnews.com/zero-confirmation-transactions-safe/

Zero- In cryptography, a zero-knowledge proof or zero-knowledge protocol is a

Knowledge method by which one party (the prover) can prove to another party (the
verifier) that a given statement is true, without conveying any information apart
Proofs
from the fact that the statement is indeed true.

Source: https://en.wikipedia.org/wiki/Zero-knowledge_proof

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 36
ZkSNARK (Zero- are the cryptographic tools underlying Zcash (open, permissionless
knowledge cryptocurrency protecting privacy of transactions using zero-knowledge
cryptography). They are proofs that you have performed a computation over
Succinct Non-
some inputs without revealing all of the inputs. Zcash uses these proofs to
interactive
verify transactions while protecting users’ privacy.
ARguments of
Knowledge) Source: https://z.cash/blog/zksnarks-in-ethereum.html and https://z.cash/

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 37
Further Reading

Website Description

http://blockchainstudies.org/ Theoretical/phil./social effects of blockchain

http://blockgeeks.com/ Bitcoin/Blockchain articles, guides, VC Access
https://bitsonblocks.net/ Bitcoin/Blockchain plain English explanations
http://bitcoinist.com/ Bitcoin demand, security, privacy, investment
http://www.blockchaintechnologies.com/ Blockchain focused technical explanations
http://www.the-blockchain.com/ Blockchain news, technology, mergers, VC
https://en.bitcoin.it/ Bitcoin Wiki
https://blockchainhub.net/ Blockchain Hubs: Links to Local Think Groups
https://github.com/ Developers Platform including Blockchain
http://www.righto.com/ Blog about motherboards, software, blockchain
http://ethdocs.org/ Everything Ethereum Documentation
https://www.elliptic.co/ Identify Illicit Activity on the Bitcoin Blockchain
https://99bitcoins.com/ Bitcoin Currency Related: Buy, Sell, Mining
https://www.paxos.com/ Post-Trade Settlement Blockchain
https://www.ibm.com/developerworks/cloud/library/ IBM Developer Technical Library
http://www.coindesk.com/ Bitcoin news and trading Info
https://blockchainhub.net/ Network of Groups with common interests
https://www.torproject.org/ Software/Open preventing network traffic analysis
https://blog.ethereum.org/ Ethereum blog
https://blockexplorer.com/ View info: blocks, addresses, and transactions
http://bitcoinchaser.com/ Bitcoin news, basics, gambling, apps
https://decentralize.today/ Bitcoin, Blockchain news and articles
https://bitcoin.org/en/ Bitcoin currency and payment network
https://dev.iota.org/ IOTA developer hub
https://www.gipp.com/projects/ Projects run by a Univer. of Konstanz professor
https://software.intel.com/en-us/sgx Trusted execution environment
http://chimera.labs.oreilly.com/ Writing, collaborating, learning platform
https://nxt.org/ Blockchain platform to create applications
https://interledger.org/ Interconnection platform and technologies
https://console.ng.bluemix.net/ Cloud Infrastructure Apps and Services
https://www.hyperledger.org/ Platform for Blockchain frameworks
http://www.bitcoinblockhalf.com/ Bitcoin Stats and Halving Monitoring
http://www.litecoinblockhalf.com/ Litecoin Stats and Halving Monitoring

The above table lists websites that provide in depth technical, financial and operational information
concerning all aspects of Blockchain/Distributed Ledger technology.

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 38
Examples of Public Blockchain Companies

Website Description Ticker Market Country

https://www.coinsilium.com/ Blockchain Investment company COIN NEX UK

http://bitcoincapitalcorp.com/ Acquisition of startups and funding companies BITCF OTC PINK USA
http://www.btcs.com/index.php Bitcoin mining: building digital payment platform BTCS OTCQB USA
http://btl.co Blockchain solutions finance, gaming, energy BTL TSX CAD
https://digitalx.com/about/ Blockchain enhanced payment solutions DCC ASX AUS
http://globalarenaholding.com/ Acquires blockchain companies and patents GAHC OTC PINK USA
http://www.grayscale.co Invests in Bitcoins GBTC OTCQX USA

Source: http://investingnews.com/daily/tech-investing/fintech-investing/7-blockchain-technology-stocks/

The above table lists 7 Blockchain/Distributed Ledger Technology companies that have made it to the
public markets via an IPO or other means (restructuring). These are just a handful of examples at the
time of the publication of this document.

Blockchain/Distributed Ledger Working Group Glossary © Copyright 2016, Cloud Security Alliance. All rights reserved 39