Glossary
Automated Market Maker (AMM)
A decentralized finance (DeFi) mechanism that enables the exchange of digital assets without requiring a centralized order book or intermediary. Unlike traditional market-making, which relies on bid-ask spreads set by human traders, AMMs use mathematical formulas to automatically set the price of assets based on supply and demand within a liquidity pool. This ensures instant, trustless trading and improves the overall liquidity of the decentralized market. In the context of blockchains, AMMs often operate as smart contracts, thus benefiting from the security and transparency offered by distributed ledgers.
APIs (Application Programming Interfaces)
Standardized sets of rules and protocols that allow different software applications to communicate with each other. In the context of blockchains, APIs enable developers to request and transmit data from and to the blockchain, facilitating interaction between external applications and the decentralized network. Through APIs, functionalities like sending transactions, querying balances, or retrieving smart contract data can be achieved seamlessly.
Avalanche
A smart contracts platform that scales infinitely and regularly finalizes transactions in less than one second
Blockchains
Distributed ledgers or databases maintained by multiple participants, or nodes, in a decentralized network. Each 'block' contains a set of transactions, and these blocks are chained together chronologically. This ensures a transparent, tamper-resistant, and immutable record of all transactions.
Consensus
The process by which validators in a blockchain network come to an agreement on the state of a blockchain or a set of transactions. Consensus mechanisms are algorithms that ensure all participants in the network agree on a single version of the truth, enabling trustless operation.
dApp (Decentralized Application)
A software application that operates on a blockchain or distributed ledger. Unlike traditional apps where the backend code runs on centralized servers, dApps run on a decentralized peer-to-peer network. Examples include decentralized finance platforms, games, and more.
Merit Circle DAO
Merit Circle is a decentralized autonomous organization (DAO) that is on a mission to revolutionize gaming
Proof of Stake (PoS)
A consensus algorithm where validators are chosen to create new blocks and confirm transactions based on the amount of cryptocurrency they hold and are willing to "stake" or lock up as collateral. Unlike Proof of Work which relies on computational power, PoS aims to achieve decentralized consensus with greater energy efficiency. Validators are incentivized to act honestly, as they stand to lose their staked funds if they are found to act maliciously.
Snowman Consensus Protocol
An evolution of traditional consensus algorithms designed to optimize linear scalability and finality. While being compatible with blockchain data structures, Snowman ensures a consistent ordering of blocks, achieving faster and more reliable transaction confirmations, making it particularly suitable for smart contract platforms.
Subnet
A Subnet is a sovereign network which defines its own rules regarding its membership and token economics. It is composed of a dynamic subset of Avalanche validators working together to achieve consensus on the state of one or more blockchains. Each blockchain is validated by exactly one Subnet, while a Subnet can validate many blockchains.
Validators
Individuals or entities in the Beam network responsible for verifying and validating transactions and adding them to the blockchain. They participate in consensus mechanisms and are an integral part of ensuring the integrity and security of the network.