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Web3 Glossary - M & N of web3
Tring Tring! Daily web3 digest is here!
Gm Gm Folks!
How’s it going for ya’ll? Ready for some web3 gyaan?
Today we have letters M & N
👉M: metaverse, mining, master node, mempool, MEV
👉N: NFTs, Nonce, Node
Metaverse is not a new concept. We have a multiple firms creating realistic metaverse
and its been a hot topic since late 2021. But what’s it all about in the web3 space?
It's an immersive & interactive virtual world where you can play, shop, dance,
party, make friends & much more using avatars & digital objects in 3D space.
With web3 tech, people can buy and sell virtual property/ NFTs, earn money while playing games - all using digital currency
Art, sports, social media & entertainment - All have jumped on the bandwagon of
building a metaverse experience for their users
Have you experienced a metaverse? How was it?
Let’s take the tech route today and understand some fundamental concepts in web3.
Let's start with Mining.
Its the process of verifying transactions, organizing them into blocks, and then adding blocks to the blockchain. Miners digitallly validate the transactions on chain.
Do ya'll know how does this work?🤔
Miners solve complex cryptographic hash puzzles to verify blocks of transactions that are updated on the decentralized blockchain ledger.
Pretty hectic right?
Miners earn rewards, paid in crypto, for verifying a new block🪙💰
You’ve heard this catchphrase around - mint your own NFT, but do ya’ll know what minting actually means?
Its the process of validating information, such as domain ownership, and registering that onto the blockchain
In case of NFTs 👇👇👇
All this tech sounds really cool, but who does the heavy loading of all of this computation and validation?
Its a blockchain node that verifies and relays transactions, stores the blockchain’s complete history and may participate in voting & governance of the blockchain, and other special operations. Master nodes generally operate on a collateral
based system, meaning the operators need to own a significant amount of the cryptocurrency.
Woah, that’s a lot of work. Where do these transaction reside before they are mined ?
In the MEMPOOL
Also known as the transaction pool or pre-chain, it’s a set of in-memory data structures propagated across blockchain nodes that store pending transactions before they're mined.
Mempool is where all the validated transaction hangout!
Given that miners have access to the mempool, they gotta get some value out of it😎
MEV (Miner/Maximal Extractable Value) is the profit a miner can make in excess of the standard block reward and gas fees by including, excluding, or re-ordering transactions in a block
Doesn't sound right?
👉MEV is arguably the most serious issue Ethereum and similar smart contract blockchains face today.
We looked at some fundamental concepts, we’ve discussed the scale of blockchains.
You would agree that blockchains are a huge network of blocks of data.
Have you ever thought where does this data get stored?🤔
You guessed it right, the data is stored on nodes. Basically, node is any device connected to a blockchain.
All the nodes on a blockchain are connected to each other & they exchange information on the blockchain
Different nodes have varying levels of responsibility, & help in validating transactions, store the blockchain’s history, relay data, and perform other functions
Nodes are the building blocks of the blockchain network and come together to create the network’s infrastructure. 💪
We’ve already learned about full, master & light nodes. If you haven’t read about it, do check out the previous posts of the newsletter👇👇
All these nodes communicate with each other to enable the peer-peer decentralised network. There must be a way to ensure that old communications cannot be reprocessed on chain.🤔
We use Hashing (I am sure you would have guessed this right😎)
Proof of work systems use nonce values to vary input to a cryptographic hash function
Nonce = no. used only once. It’s a 4 bit number added to a hashed block in a blockchain, which when rehashed, meets the difficulty level restrictions
Its the number a blockchain miner needs to discover before solving for a block in the blockchain.🤯🤯
Miners open new blocks by generating a nonce that makes the hash they create, less than the hash from the block they’re validating. For a deep dive, checkout one of my prev threads on this
Let’s close the day with the hottest topic of the web3 space.
NFT: Non Fungible token
It’s a digital certificate/receipt of authenticity used to assign and verify ownership of a unique digital or physical asset.🪙🪙
NFTs are not interchangeable with one another. They’re based on Ethereum's ERC-721 token standard.
Anything real/digital can be an NFT- real estate, art, music, tweets, signed movie posters and much more.🤩
💡Collectors have sent over $37 bn into the NFT marketplaces as of May 2022.🤯
💡In Q1 2022, 950,000 unique addresses bought or sold an NFT.
It’s a growing market and expected to reach $122.43 bn by 2028. 💯💯
Do you own an NFT? When did you buy/mint your first NFT?
Let me know in the comments
For all the new folks here
web3glossary series is a free resource for folks new to crypto, NFTs, blockchain, and all things decentralized. It’s an attempt to help demystify commonly used terminology and to help you better understand Web3.
That’s a wrap for today!
Stay tuned for more on the new vocabulary of the web for next 30 days.💯
It’s like a free crash course on the jargons and terminologies in Web3.
As ever, thank you for subscribing and reading. It matters. It’s a big deal to me.
And, remember, half-true compliments and feedbacks are always welcome at:
laisha.wadh [at] gmail [dot] com