Often confused: blockchain terms side by side
Eight pairs of terms that are easy to swap, explained next to each other. These are comparisons of ideas, not of products.
Hash vs encryption
Hash
A one-way fingerprint. Anyone can compute it from the data, nobody can turn it back into the data, and there is no key. It answers the question "is this exactly the same data?".
Encryption
A two-way lock. Data is scrambled with a key and can be unscrambled with the right key. It answers the question "who is allowed to read this?".
In short: Hashing proves sameness; encryption protects secrecy. Bitcoin and Ethereum rely heavily on hashing and signatures, and the public chain itself is not encrypted. Read the card: What is a hash function?
Public key vs private key
Public key
Derived from the private key and safe to share. Others use it to check that a signature is genuine, and addresses are usually built from it.
Private key
A secret number that creates signatures. Whoever holds it can authorise anything the key controls, so it is never shared.
In short: The private key signs, the public key checks. You can go from private to public easily, but not back. Read the card: What is a private key?
Proof of work vs proof of stake
Proof of work
Block producers compete by repeating hash calculations until one finds a result below a target. Rewriting history would require redoing that computation.
Proof of stake
Block producers lock a deposit and are chosen to propose and vote on blocks. Breaking the rules can cost part of that deposit.
In short: Both decide who adds the next block. One makes cheating expensive through spent electricity, the other through deposits that can be destroyed. Read the card: What is proof of work?
Coin vs token
Coin
Usually means the native unit of a blockchain, built into its base rules and used to pay its fees — for example bitcoin on Bitcoin or ether on Ethereum.
Token
A unit tracked by a smart contract that runs on an existing blockchain. Anyone can deploy such a contract, and the token follows that contract's rules.
In short: A coin belongs to the chain itself; a token lives inside a program on the chain. In everyday speech the two words are often used loosely. Read the card: What is a token?
Custodial vs self-custody
Custodial
A company holds the private keys on the user's behalf. The user depends on that company being solvent, honest and secure, as with any other custodian.
Self-custody
The user holds the keys personally. Nobody else can block access, but nobody else can restore it either if the keys or the recovery phrase are lost.
In short: The question is simply who holds the keys. Each arrangement shifts responsibility to someone; neither removes risk. Read the card: What is a private key?
Soft fork vs hard fork
Soft fork
A rule change that only tightens the rules. Blocks made under the new rules are still valid to nodes running the old software.
Hard fork
A rule change that loosens or alters the rules, so old software rejects the new blocks. Every node must upgrade or end up on a separate chain.
In short: Soft forks stay compatible with older nodes; hard forks do not. Read the card: What is a fork in blockchain?
Wallet vs address
Wallet
Software or a device that manages keys and creates signatures. One wallet can manage many keys and many addresses.
Address
A short identifier, derived from a public key or a script, that shows where value is recorded on the chain. It is shared openly, a bit like an account number.
In short: The wallet is the tool that holds keys; the address is a label others use. Value is recorded on the blockchain, not inside the wallet. Read the card: What is a blockchain address?
Blockchain vs database
Blockchain
An append-only record copied across many independent computers that agree on its order without a single owner. Changing history is designed to be visible and very costly.
Database
A store of data run by one organisation, which can read, change and delete records quickly under its own rules and permissions.
In short: A blockchain trades speed and simplicity for shared control. If one trusted party can keep the record, an ordinary database is usually the better tool. Read the card: What is a block?
This page compares ideas, not products. It does not recommend any crypto-asset, service or way of holding keys.