Smart Contracts
Computer verified contract between two or more parties that is legally enforceable.
Imagine a transaction taking place without a middle person or organisation:
e.g. there is no Air bnb taking commission a simple ecosystem the commission fees are divided up:
Renter then Property Owner, Property Agent, Cleaner and advertisers a contract of terms is developed and assigned by each whether a standard or tailor-made a template.The platform is paid for its maintenance such as server time etc. and transaction fees.
These are all facilitated by smart contracts on a platform and ecosystem, in which people create the contracts each time they are transacting as above.
Therefore there is no longer AirBnB taking a profit simply a computer system and imagine the computer processing and data centre, were the ones paid for hosting the ecosystem. That saved alot of money 15%to18% in total for all involved. These funds can be cut from the rental, price pay the property owner provide extra services etc…
Now blow our minds even further imagine if we could do that with Amazon or Uber. It will become a Startrek Like Utopia, instead of an Blade Runner Dystopia.
Blockchain
We need to store these contracts for a period of time as defined by the agents and the law. The blockchain can store these contracts on what are called blocks. The blockchain can be changed or not depend on how its programmed. The block chain can store and have information in any type or format such as videos, audio, data etc.
Crypto Currencies & Digital Assets
Cryptocurrencies are based on the blockchain the ability to transfer funds between people without using a bank.
Digital assets can also be cryptocurrencies or anything that is stored upon a block chain such as music, your ID etc. These sometimes can be real world assets such as land registry.
Tokens/Currencies
The confusion now comes into play what is the terminology of a token. To me a token is anything trad-able or holds value, it is a currency a digital asset etc. The token can hold many physical or contractual forms depending, on the contract that is executed in its exchange or transfer and interaction between various agents and systems. There are tokens you will find that hold no value and have some sort of future promise these are usually perceived as speculation and high risk to many people including people raising investment.
Decentralised Internet & Protocols and Nodes
The web as we know it is developing into less of a centralised place and network example:
Facebook it owns its own servers at the start in a data centre. It holds all of your data.
Then Facebook expands and owns it own Data centres globally. The company still holds all of your data.
Decentralised Facebook your content is held on the Facebook platform but is distributed across the web in several data centres securely sharing the computing powe and systems on-demand.
Protocols are a way for computers to interact, often with each other, protocols that are developed to be, open source usually win but this is not always true a developer of a protocol that is better than others may have the upper hand in particular if the product or service it works with has a leading edge on the market.
e.g. a software suite of services that is leading edge in the market where people and computer interact with each other in the decentralised internet. Will have a leading protocol as it is popular.
Blue Ray or DVD anyone tape vs 1s and 0s scratched onto a compact CD or even better, cloud-based streaming?
Nodes will be a part of the decentralised web, anything that has token/coin/asset that allows the facilitation of network transactions will hold the token and allow the network to transact over it usually nodes are secure, servers that have a longer than 1-month life in the network as they are encourged to stay as processing power for the transactions in decentralised data centers.
The Mix UP
Tokens/Currencies/Assets
Well depending on your project you may have different types of tokens, currencies or assets you can make them act indifferent, as long as it is understandable to the stakeholders. I am sure that a common language will transpire in time, though as the dough, is also money then slang terms will too.
Note: Often people change and use crosscutting terminology it is always good to know the context and what they mean and the team means by each of therefore making it simpler for the customers.
I hope you found this very basic and simple guide useful as an introduction. It is to open your imagination, in our workshop/s. This should not be your only guide or limit to imagine, how blockchain and the internet and technology will work in the future, search and look for different ideas and create the above as you wish:
How do you plan to disrupt current business models?
How do you want a node to operate?
How do you want smart contracts to operate?
What type assets do we want?
Who do you want your system to interact with or avoid?
Merge what you know and be creative the ideas are limitless.
Good Luck!