Intro to Blockchain
A crypto coin is a digital asset that operates on its own blockchain. Think of a blockchain as a digital ledger that records all transactions. The entries in that ledger are about transactions that occur on the blockchain. The coin is your currency in the chain.
Coins like AREA have their own unique blockchains and serve as both the asset you can own and the network on which transactions occur. In simple terms, when you own a crypto coin, you own a piece of the network where it operates.
A token is also a digital asset, but it doesn't have its own blockchain. Instead, it operates on another coin's blockchain. For example, many tokens run on the Ethereum blockchain or Binance Smart Chain.
Tokens follow certain standards, like ARC-20, that allow them to interact seamlessly with other tokens and applications on that network. Tokens can represent a sub-currency. But they are often used to represent assets like real estate or art, or to access features in a software.
Some blockchain projects such as Areon Network can start their journey as a token, and later build their community, while they are developing their own chain.
dApp is short for Decentralized Application. It is a software that runs on a blockchain rather than on a centralized server. Unlike traditional apps where a single company controls the data and functionality, dApps are open-source and operate on a peer-to-peer network.
This means that no single entity has control over the application, making it more transparent and resistant to censorship or limitations.
A Smart Contract is a self-executing code. It is a digital contract with the terms of the agreement directly written into lines of code. Smart contracts run on a blockchain, ensuring that it is tamper-proof and transparent.
Since retrospective editing or tampering is not possible in blockchain, the contracts are secure and permanent.
Once conditions specified in the contract are met, it automatically executes actions like transferring tokens or coins. This eliminates the need for intermediaries, making transactions more efficient and secure.
NFT stands for Non-Fungible Token. NFT protocols refer to the rules or standards that govern how these unique digital assets function on a blockchain.
Unlike coins or tokens, which are interchangeable with each other, NFTs are unique. They can represent ownership of specific items like digital art, collectibles, or even real estate.
Popular NFT protocols include ARC-721 and ARC-1155 on the Areon blockchain, which define how to create, transfer, and interact with NFTs.