Canton Network Glossary

This glossary provides definitions for key terms and concepts related to the Canton Network, blockchain technology, and institutional finance.

A B C D E F G H I K L M N O P R S T V W
A
  • Atomic Transaction
    A transaction that either completes entirely or not at all. In Canton, atomic transactions ensure that complex multi-party operations either succeed completely or are rolled back, preventing partial execution that could lead to inconsistent states.
  • Active Contract
    In Daml, a contract that has been created but not yet archived. The set of all active contracts represents the current state of the ledger.
B
  • Bandwidth Units
    A measure of computational and storage resources consumed by a transaction on Canton. Transaction fees are calculated based on bandwidth units consumed.
  • BFT (Byzantine Fault Tolerant)
    A property of distributed systems that can continue to operate correctly even if some participants are malicious or faulty. Canton uses BFT protocols to ensure network security.
  • Burn
    The permanent destruction of tokens. In Canton, transaction fees paid in Canton Coin are burned, removing them from circulation and creating deflationary pressure.
C
  • Canton Coin
    The native token of the Canton Network, used for paying transaction fees and rewarding validators. Fees are burned while rewards are minted, creating a dynamic supply model.
  • Canton Foundation
    The non-profit organization that governs the Canton Network. Established in July 2024 and affiliated with the Linux Foundation, it oversees protocol development and network governance.
  • Canton Protocol
    The interoperability layer that enables different Daml applications to communicate and transact with each other while preserving privacy and ensuring consistency.
  • Choice
    In Daml, an action that can be performed on a contract by an authorized party. Exercising a choice typically archives the original contract and may create new contracts.
  • Collateral
    Assets pledged as security for a financial obligation. Canton enables 24/7 collateral mobility, allowing assets to be moved and reused more efficiently than in traditional systems.
  • Composability
    The ability of different applications and smart contracts to interact and build upon each other. Canton's architecture enables composability across different applications on the network.
  • Controller
    In Daml, a party who has the authority to exercise a specific choice on a contract. Controllers are defined in the contract template.
  • Custodian
    An organization that holds and safeguards assets on behalf of clients. In the Canton ecosystem, custodians provide secure storage for digital assets including Canton Coin.
D
  • Daml
    Digital Asset Modeling Language - an open-source smart contract language developed by Digital Asset. Daml is designed for building distributed applications in regulated industries with built-in privacy, authorization, and composability features.
  • Digital Asset
    The technology company that developed Daml and the Canton protocol. Founded in 2014, Digital Asset provides the core technology underlying the Canton Network.
  • DLT (Distributed Ledger Technology)
    A digital system for recording, sharing, and synchronizing data across multiple locations. Canton is a form of DLT designed specifically for institutional finance.
  • Domain
    See Synchronizer. "Domain" was the previous term used for synchronizers in Canton documentation.
  • DVP (Delivery Versus Payment)
    A settlement mechanism where the transfer of securities occurs only if the corresponding payment is made. Canton enables atomic DVP, eliminating settlement risk.
E
  • Epoch
    A defined period of time in the network's operation, often used for reward distribution and validator rotation.
F
  • Formal Verification
    A mathematical technique for proving that software behaves correctly under all circumstances. Daml supports formal verification, allowing developers to prove their contracts are bug-free.
G
  • Global Synchronizer
    The primary public synchronizer that enables interoperability across the entire Canton Network. It is operated by a decentralized set of validators and governed by the Canton Foundation.
H
  • Hard Fork
    A protocol upgrade that is not backward-compatible, requiring all participants to upgrade. Hard forks in Canton require supermajority approval from validators.
I
  • Interoperability
    The ability of different systems, applications, or networks to work together. Canton's architecture enables interoperability between different Daml applications through the Canton protocol.
K
  • KYC (Know Your Customer)
    Regulatory requirements for financial institutions to verify the identity of their clients. Canton is designed to support KYC compliance while preserving privacy.
L
  • Ledger
    A record of transactions. In Canton, each participant maintains their own private ledger containing only the data relevant to them, while the protocol ensures consistency.
M
  • Mint
    The creation of new tokens. In Canton, new Canton Coins are minted to reward validators and other network participants.
N
  • Network of Networks
    Canton's architectural approach where multiple synchronizers can operate independently while still enabling interoperability through the Global Synchronizer.
  • Node
    A computer that participates in the Canton Network by running the Canton software. Nodes can be validators, application nodes, or participant nodes.
O
  • Observer
    In Daml, a party who can see a contract but did not need to authorize its creation. Observers have read access but cannot exercise choices unless also designated as controllers.
P
  • Participant
    An entity that connects to the Canton Network to use applications or provide services. Participants can be financial institutions, application providers, or validators.
  • Privacy
    In Canton, the principle that transaction data is only visible to parties who need to see it. Unlike public blockchains, Canton ensures that sensitive information is never exposed to unauthorized parties.
  • Programmable Privacy
    Canton's approach to privacy where smart contracts explicitly define who can see what data, and the runtime enforces these rules automatically.
R
  • Repo (Repurchase Agreement)
    A short-term borrowing arrangement where one party sells securities to another with an agreement to repurchase them later. Canton enables 24/7 repo trading with instant settlement.
  • Real-time Settlement
    The immediate finalization of transactions, as opposed to traditional T+1 or T+2 settlement. Canton enables real-time settlement for various financial instruments.
S
  • Signatory
    In Daml, a party who must authorize the creation of a contract. Signatories always have visibility into contracts they have signed.
  • Slashing
    A penalty mechanism where validators lose a portion of their staked tokens for misbehavior or failure to meet their obligations.
  • Smart Contract
    Self-executing code that automatically enforces the terms of an agreement. In Canton, smart contracts are written in Daml and define the rules for creating and modifying data.
  • Soft Fork
    A backward-compatible protocol upgrade that does not require all participants to upgrade immediately. Soft forks require simple majority approval from validators.
  • Stablecoin
    A cryptocurrency designed to maintain a stable value, typically pegged to a fiat currency like USD. Stablecoins on Canton (like USDC) enable instant settlement of transactions.
  • Staking
    The process of locking tokens to participate in network security and earn rewards. Validators must stake Canton Coin as a security deposit.
  • Super Validator
    One of the 30 major validators with enhanced governance rights and responsibilities. Super validators are typically major financial institutions with significant stake in the network.
  • Synchronizer
    The coordination layer in Canton that orders transactions, provides timestamps, and mediates conflicts. Previously called "domains." Synchronizers do not see transaction contents.
T
  • T+1, T+2
    Traditional settlement timeframes where "T" is the trade date and the number indicates business days until settlement. Canton enables T+0 (same-day) or real-time settlement.
  • Template
    In Daml, a blueprint for creating contracts. Templates define the data structure, signatories, observers, and choices available on contracts of that type.
  • Tokenization
    The process of representing real-world assets as digital tokens on a blockchain. Canton supports tokenization of various asset classes including bonds, equities, and commodities.
V
  • Validator
    A node operator that participates in transaction validation and network security. Validators stake Canton Coin and earn rewards for their services.
  • Virtual Global Ledger
    Canton's approach where the protocol creates the illusion of a single global ledger while actually distributing data across many participants based on need-to-know.
W
  • Wallet
    Software or hardware that stores cryptographic keys and enables users to interact with the blockchain. Wallets are used to hold and transact Canton Coin and other digital assets.