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Lingo of the 3.0 Verse
Pick up the lingo, brush up the language. A quick browse on the terms and terminology explained in simple English. Don’t have the FUD anymore. Don’t have FOMO anymore. We got your back.
A point in time when a party has a flat-out upper hand over another party in providing a service or product in an efficient manner. This can be achieved by generating the products at a lower price than the market, using various methods to ensure maximum benefit.
The approach adopted by fund managers and brokers, in tracking a client’s portfolio and assets to ensure it outperforms the market to yield a higher profit from both, the bear and the bull markets. The brokers rely heavily on analytics and research to make decisions. Furthermore, they track the latest trends in the market with an eagle’s eye to ensure a positive outcome to their trades. This approach generally has its fees on the higher side as although it brings in a potentially higher profit, it also carries higher risks and trading costs with it.
He is the inventor of Hashcash, a proof-of-work system which is heavily used in the bitcoin mining process. Besides that, Adam Back is also a well-known cryptographer, influencer and a cyberpunk based in UK. He is the co-founder and CEO of Blockstream, a tech company specializing in cryptocurrency softwares. Blocktream also provides solutions and services for bitcoin storage and transference amongst other things.
Cryptocurrency addresses are used to receive and send transactions on the network. An address is a string of alphanumeric characters, but can also be represented as a scannable QR code.
A latin term which literally translates to ‘for this’. In the field of cryptocurrencies and blockchain, it is used to imply particular solutions built in catering to a particular problem in the system or the network.
A visual representation which charts a s-curved line to portray the rate at which a new technology or a new initiative has been accepted by people. Whenever a new technology or concept is introduced to the general population, there is a vast speculation around it and is not instantly adopted, despite gaining attention in large numbers. The growth of acceptance and absorption is gradual as people slowly start to accept this new idea and wrap their thoughts around it. This trend when mapped resembles a s-curve, thus the name. There are 5 stages to the adoption – innovators, early adopters, early majority, late majority, laggards.
A marketing campaign that distributes a specific cryptocurrency or token to an audience. When a new project is launched, in order to increase the user base, the project often conducts a free distribution of tokens/coins as incentive. They ask people to perform simple tasks like creating a wallet, joining a discussion group, watching tutorial videos, etc. before awarding them with free tokens. This is known as Airdrop.
A set of steps needed to be followed in order to successfully fulfill a duty. In the field of tech, it can also be termed as a set of commands or codes required to successfully complete a particular task. The set of instructions are to be followed in a particular order for the algorithm to be successful in achieving the goal. In cryptoverse, Algorithms are of use in setting up orders to trade the cryptocurrencies when the desired price point has been met.
An order with a specific set of instructions to be followed either in its entirety or not at all. AON order is mostly used in the field of finance, especially on exchanges where participants can set conditions on a buy / sell order. If those conditions are not met the order will not be executed and remain open and active.
When a cryptocurrency reaches its highest price point in the history, it is said to have reached an All-Time High (ATH).
When a cryptocurrency reaches its lowest price point in the history, it is said to have reached an All-Time Low (ATL).
The excess return chased by fund managers / participants over and above the return provided by the benchmark.
An altcoin is a bitcoin alternative. There are many hundreds of altcoins currently being marketed. It stands for alternative coin. Bitcoin maximalists consider bitcoin to be the true cryptocurrency and every other coin or token as altcoin.
A person who invests in a new business venture or a startup to back them financially, acting as an ‘angel’ providing a major support in terms of capital, thus the name.
It refers to a framework comprising of a set of laws and regulations put in place to prevent money laundering through cryptocurrencies. This prevents criminals from engaging into any illegal money trafficking or money making through cryptocurrencies and converting them into real-world currencies. AML laws cover various illegal activities, namely public corruption, trading in illegal goods, tax evasions and market manipulation.
API is a set of protocols, routines and codes that are used in building and incorporating software applications. It allows for a software application to interact with another. This tool is crucial in helping programmers create a software, and to provide swift and enduring applications.
Arbitrage means locking-in a profit by simultaneously entering into transactions in two or more markets for an asset(s) that is / are trading with a price differential. The typical Arbitrage trading strategy usually involves taking opposite buy / sell positions simultaneously in different markets (say, 2 different Cryptocurrency Exchanges) for same or different but largely correlated assets.
Ask Price is the lowest price acceptable on a sell order by the seller when they are trading on an exchange. It is also called the offer price in some cases.
A systematic management strategy used to buy, operate, maintain, upgrade and sell the assets in the most feasible manner. An asset manager focuses to generate optimal profit for their client’s assets with the least risks involved.
The opposite of simultaneous, it stands for when two or more events not occurring at the same time or rate. A modular framework is used to design the asynchronous systems. Each module has the ability to operate independently and communicate with the peer modules in these types of systems.
A way of letting people directly exchange one type of cryptocurrency for another on a different blockchain or off-chain without a centralized intermediary such as an exchange. Smart contract enabled cross-chain transactions without involving an intermediating party. These contracts use a HTLC or Hashed Timelock Contract to enable a swap between agreeing parties within a timeframe or not at all.
The vulnerable point of entry or multiple points of entry for unauthorized users to access the software environment and gather and extract information for their personal and unethical gains. This attack has a potential of damaging the environment by altering information and exploiting the system. Focus and priority should be to reduce the attack surfaces to ensure a safer and a more secure software environment.
AUTOMATED MARKET MAKER (AMM) An automated market maker (AMM) is a system that provides liquidity to the exchange it operates in through automated trading. A smart contract enabled algorithm which automatically executes swap trades between two Liquidity Pools determined by their balance of assets. The value of exchange can be determined algorithmically or can be determined by the use of an Oracle. This is a feature of the Decentralized Exchange (DEX).
A collection of coin and token a person is ‘hodling’ in their portfolio is termed as a bag. Generally, a Bag is used to define a substantial amount of a specific cryptocurrency.
Someone who stubbornly continues to possess and do not sell a coin the price of which is plunging fast. This kind of participant hopes against hope that the price of the coin will recover. They eventually lose their investment in that particular coin.
A downward trend seen in a market within a short duration is called a bear market. This term is used in various markets along with cryptocurrencies, such as bonds, stocks, currency, commodities, real estate, etc. Essentially, a bear market is ignited when a trend has seen around 20% price drop within the past 60-days. In crypto bear markets, a price drop of 85% is rather common and is to be expected.
A standardized point-of-reference used to analyze how a particular investment or asset/token portfolio is performing in the market. Indices are one of the most common benchmarks followed and used as representation of market prices.
The successor of the Alpha Stage, Beta version is made for the users to test the program / software and send their feedbacks to the project team. At the Beta stage, the software/program is fully functional but still has scope for improvement based on its user-interface, efficiency, and security measures before it can be launch for the general public. Some software companies release their products to a small group of out-sourced programmers, developers, and potential customers to review their product and give feedback to further improve it.
The highest price a buyer is willing to pay for any product, service, etc., is termed as the bid price. In cryptoverse, it is referred to as the highest value a buyer is comfortable to pay for any token or coin. Sellers have the option to either agree to the bid price the buyers are willing to pay or set an asking price.
The price difference between the highest bid price acceptable to the buyer and the lowest asking price set by the one selling.
Bitcoin is the name to the system proposed by Satoshi Nakamoto where a peer-to-peer network of participants can transact with each other without the intervention of any Trusted Third Party. The Trust in the system is provided by Cryptographic proof of transaction and hence this is known as the world’s first cryptocurrency.
A technical design document providing information to the Bitcoin community, describing new proposed features, processes or environments affecting the bitcoin protocol. Suggested changes to the protocol are submitted as a BIP. The BIP author is responsible for soliciting feedback and consensus for his or her suggested improvements within the community, and documenting dissenting opinions. A technical document in the form of a protocol suggesting improvements in the bitcoin protocol. This is usually developed and submitted by community members of the peer-to-peer network for consensus. Once this proposal receives consensus, the protocol improvement is implemented.
An occurrence that happens as a surprise or unexpectedly and brings with it serious negative after-effects. They are impossible to predict and have catastrophic effects. It can be any entity, asset or product that can cause this effect in the cryptoverse.
Blocks are packages of data that carry permanently recorded data on the blockchain network. In blockchain technology, Blocks are the components of the data structure which record the transactions. The blocks also contain other information like timestamps, previous blocks and creator.
A blockchain is a shared ledger where transactions are permanently recorded by appending blocks. The blockchain serves as a historical record of all transactions that ever occurred, from the genesis block to the latest block, hence the name blockchain. This is a technology which is a type of Distributed Ledger Technology where the data structure has transactions recorded in blocks and the blocks are added in sequence.
An online tool to view all transactions that has taken place on the blockchain, network hash rate and transaction growth, among other useful information. This is the digital form of the transparent ledger created by the Distributed Ledger Technology called blockchain. This provides the information on all blocks and also other network information like hashrates, mempool, etc.
Block height refers to the number of blocks connected together in the block chain. For example, Height 0, would be the very first block, which is also called the Genesis Block. This is a number, this number represents the position of the particular block in the blockchain ledger which is created.
A form of incentive for the miner who successfully calculated the hash in a block during mining. Verification of transactions on the blockchain generates new coins in the process, and the miner is rewarded a portion of those. Blocks are added to the growing ledger of blockchain by a validator who in turn receives a reward. This reward is the incentive which motivates participants to undertake the necessary work of validating and verifying the transactions before putting them together and adding them to the growing list of ledger.
A point in time when the total revenue made by any particular product or service matches the total cost of its production is termed as a Break-even Point. At this point, there is no net profit or loss faced by the company and all the funds used to create that product have now been covered. In cryptoverse, break-even point analysis is done to track the stage of the trading strategies, if they have suffered a loss or secured a profit and tweak them accordingly to cover up thelosses suffered or increase the profit made thus far.
To focus on constantly adding and improving any cryptocurrency and blockchain ecosystem is termed as BUIDL. This concept heavily promotes to actively contribute to the growth of the ecosystem and helps generate a substantial adoption of the ecosystem.
The opposite of a bear market. Bull market is a positive growth witnessed in the price trends in a market. A term used widely in traditional and cryptocurrency markets, it represents a uptrend seen by the markets within a short span of time. Essentially, a bull market is ignited when a trend has seen around 20% price rise compared to the previous low witnessed by the asset.
Byzantine Fault Tolerance (BFT) is the property of a computer system that allows it to reach consensus regardless of the failure of some of its components. Byzantine Fault is a severe form of failure mode in Network interaction systems. BFT is a systemic solution to these kinds of faults - which essentially means that the interacting network will arrive at consensus despite occurrence of Byzantine fault events in the system.
A financial derivative contract that gives the right, not an obligation, of buying an asset within a particular time frame for a set price to an option buyer.
Technical analysis indicators use the past prices of a cryptocurrency for forecasting its future price movement. The most used chart is the candlestick chart to gauge the signal the market is giving and study price patterns. It consists of the high, low, opening and closing prices of any particular asset within a selected period.
A process which comprises of sale of cryptocurrencies, assets and holding to quickly sell them off irrespective of the loss endured. It can also be called panic selling as the sell orders cross the average level of sales. This exponential traffic in sales has the ability to influence the price and drop it lower until it reaches a bottom.
When a section or all part of an asset or network or an organization are controlled by a single entity, it is termed as to be centralized. A centralized system has a central power which has the right and authority to oversee the decision-making process.
CBDCs are digital currencies issued by a central bank whose status as legal tender depends on government regulation or law. CBDCs are digital form of fiat money issued by a nation’s central bank in lieu of cash or coins representing the lien on the particular central bank. CBDCs are issued over DLTs and have numerous efficiencies and advantages over the paper / metal coins or centralized banking system in general.
Chain splits are another term used to describe cryptocurrency forks — the separation of a single original coin into several independently managed projects. Also known as forks, chain splits represents transaction ledger maintenance in two distinct ledgers which are run by separate independent protocols after the split occurrence.
A set of clear and concise instructions that can be followed to encrypt or decrypt any form of message. It is a vital concept and used heavily in cryptography for a secure transfer of information between two parties who share a ‘key’ to decrypt the then message to reveal the original message, also known as plaintext.
The best approximation of the number of coins that are circulating in the market and in the general public’s hands. The total number of coins or tokens of any digital asset in circulation among its users in the network.
A resource pool comprising of a set of servers which can be accessed through the internet from various devices and to multiple users irrespective of their physical location are termed as cloud. Typically, these servers are in remote locations and are laid across several data centers around the world. A cloud server is a very powerful infrastructure, in a physical or a virtual form, which has the ability of performing various applications and can store processed data in a large amount. As a cloud is cost-effective and easily scalable, it has attracted an evident amount of traffic across servers.
A coin can refer to a cryptocurrency that can operate independently or to a single unit of such cryptocurrency. In cryptocurrency, a coin represents the right to transfer assigned units of the digital asset. Transactions occur when the present holder of the right to transfer exercises his rights and transfers the right to transfer to a new holder.
In mineable cryptocurrencies, a coinbase is the number of coins that are generated from scratch and awarded to miners for mining every new block. The issuance of new coins in a cryptocurrency ecosystem happens from Coinbase. It is the source of all coins in circulation and will be the source of all coins which will come into circulation subsequently.
Coins are removed from circulation to control the supply of the coin. They are sent to a wallet address that just stores these coins. Coins once in this wallet become unspendable and out of circulation. These wallets are called burner wallets. This burning is done with the aim of increasing the value of the coins in circulation.
Offline storage of cryptocurrencies, typically involving hardware non-custodial wallets, USBs, offline computers, or paper wallets.
A cryptocurrency wallet that is in cold storage, i.e. not connected to the internet. Cryptocurrency wallets or storages which store the passwords or private Key in any physical storage device which is not connected to the internet.
A valuable item given as a guarantee in order to acquire something more valuable. In cryptoverse, collateral is termed as the cryptocurrency coin, token or asset that is used in crypto-backed lending. A borrower needs to give the collateral as a guarantee of repaying the loan. Crypto-backed loans use bitcoin or other similar coins as collateral.
A shared facility or an establishment that stores specialized hardware and IT equipment for multiple parties. Colocation is used in High-frequency trading (HFT), where colocation is the space reserved for stock exchanges in a data center. HFT traders work out of these data centre’s so as to benefit by time arbitrage. This way, HFT traders and the companies receive the real-time prices of the assets in the market before they are released to the public. Despite the time difference of only a few nanoseconds, it still counts as an advantage and millions of dollars are paid by the HFT firms for the lead.
A collateralized debt position is held by locking collateral in smart contracts to generate stablecoins. The process to issue certain digital tokens / assets against collateral assets deposited with any custodian.
The successful act of hashing a transaction and adding it to the blockchain. Confirmation is the process of verifying, validating and adding a transaction to the ledger with its cryptographic proof of occurrence.
Confirmation time refers to the time that has been elapsed from the second the network received a blockchain transaction and till the time it gets recorded on a confirmed block. In layman’s terms, it denotes the total duration any user needs to wait for their transaction to be collected and confirmed by a miner node.
The merging of two or more investment strategies, approaches, or trading signals into one integrated strategy for investment is called confluence. In investment, confluence is achieved when a customized portfolio is created on the basis of multiple strategies which will lead to portfolio diversification.
Consensus is achieved when all participants of the network agree on the validity of the transactions, ensuring that the ledgers are exact copies of each other. Consensus is the state of agreement between all participants of the network about the validity of a transaction.
Consensus in a peer-to-peer network is achieved through consensus algorithms which are a set of defined rules the participants must go through in order to verify and validate all transactions prior to adding them to the ledger.
A privately owned and operated blockchain where a consortium shares information not readily available to the public, while relying on the immutable and transparent properties of the blockchain. A privately held and managed blockchain based DLT which allows only a focused group of participants to share the transaction ledger while transacting among themselves.
A cryptoasset is any digital asset that uses cryptographic technologies to maintain its operation as a currency or decentralized application. Any asset which uses cryptographic proof of transaction as trust rather than a trusted third party as a source of trust in its operations.
Cryptocurrencies are digital currencies that use cryptographic technologies to secure their operation. Cryptocurrencies are the class of digital assets which are offered over a Distributed Ledger Technology like blockchain, among participants in a peer-to-peer transaction network - maintaining a cryptographically protected transparent immutable digital ledger among themselves while being governed as per the rules of an agreed consensus algorithm like Proof-of-Work.
Cryptographic hashes produce a fixed-size and unique hash value from variable-size transaction input. The SHA-256 (Signature Hash Algorithm) computational algorithm is an example of a cryptographic hash. A cryptographic protocol in which a unique alphanumeric output is generated to represent a variable input. This deterministic function is a one-way encryption to assure that the variable input is not tampered with at a later stage thereby producing immutable records.
Decentralized Autonomous Cooperative (DAC) is any organization controlled by its shareholders instead of a centralized authority figure.
Running as a continuous background process, Daemon is a computer program which gets activated only when there is a service request. Its sole purpose is to attend to those requests periodically.
Decentralized Autonomous Organizations can be thought of as corporations that run without any human intervention and surrender all forms of control to an incorruptible set of business rules. It is a collection of Dapps to program the automation of various activities of an organization.
A decentralized application (Dapp) is an application that is open source, operates autonomously, has its data stored on a blockchain, incentivized in the form of cryptographic tokens and operates on a protocol that shows proof of value. An application which uses the smart contract features of a public blockchain platform to create a set of bespoke purposeful activities for its users. The transactions generated with its usage are recorded in the public blockchain.
A brief upward trend in the price of an asset going in decline before it continues to dropdown further thus getting the name. This term is used by traders and analysts in the cryptocurrency markets and financial exchanges for the technical analysis of the trends of any particular asset. It can further be used to forecast the continuity in the price trends.
Decentralization refers to the property of a system in which nodes or actors work in concert in a distributed fashion to achieve a common goal. Refers to a system which runs without the participation of any singular authority acting on its own and also through appointed agents who enjoy privileges of decision making on behalf of other participants.
A peer-to-peer exchange that allows users to buy and sell cryptocurrency and other assets without a central intermediary involved. An marketplace application which allows participants to exchange any digital assets among themselves without the intervention of any central authority - it is enabled by auto executing smart contracts.
DeFi is the term widely used for the peer-to-peer financial applications developed on the blockchain systems. They provide financial services through a network of public blockchains which are decentralized, such as Ethereum. Decentralized Finance bring multiple benefits with it to the table when compared to thetraditional finance entities; they are a rather secure, flexible, and a faster way to engage in various financial activities such as lending, buying derivatives, trading, applying for loans, and for future savings. DeFi is an open way to access financial markets which are free of cost and are easily accessible to anyone who has connectivity to the internet.
The process of restoring any encrypted data into its original form making it easier to comprehend. The data is converted from a ciphertext into a plaintext making it understandable in layman’s terms. In order to be able to do this task, particular cryptographic keys are required.
A segment of the internet which is kept under the wraps and away from the general users of the internet. It comprises of obscure URLs which cannot be found on the traditional search engines like Google, Firefox, Bing, etc. Having a direct link to that particular webpage is only the first step of diving into the deep web as the webpages and links on the deep web are accessible only through an authentication method that is rather specific and detailed. Traditionally, deep web is used for trafficking of illegal products, drugs and the commodities generally sold in the black markets.
When any asset is removed from the list of available assets for trade on any exchange, the process is termed as Delisting. In cryptoverse, when a delisting of coins / tokens happens, it forces all their trading pairs available on any cryptocurrency exchange to be removed. The traders / investors of that specific token are given a deadline to withdraw their funds linked to that token / coin before the cryptocurrency project becomes unavailable in any form across all cryptocurrency exchanges.
A chart that plots the requests to buy and sell on a chart. It is a visualization of the order book indicating the ideal time to enter a transaction. A participant reading the chart can place the cursor on any part of the line to ascertain the number of orders placed at that price point.
An attack when a user deliberately creates a flawed decentralized market, smart contract, or any other software with the intention to take malicious advantage over innocent users in the near future.
A type of wallet that derives keys from a starting point called a seed. As long as you have this seed, you are able to backup and restore any wallet. It is a system where the keys to a wallet are derived from a single starting point called seed. The seed can be stored in humanreadable words in a seed phrase and can be used to easily backup and restore a wallet. It may also be used to generate public addresses without the knowledge of the private keys.
Difficulty, in Proof-of-Work mining, is how hard it is to verify blocks in a blockchain network. In the Bitcoin network, the difficulty of mining adjusts verifying blocks every 2016 blocks. This is to keep bitcoin block verification time at ten minutes. Difficulty is an auto-adjusting network parameter which will determine the time required to perform a specified activity, like creating a block, depending on the network resources dedicated to that action.
In lieu of the migration of Ethereum to a Proof of Stake system, there has been an evident increase in the number of challenges surrounding the mining of Ethereum. This increase in the challenges is called the difficulty bomb. The main reason behind the migration to a POS system is claimed to be able to bring a balance in the power and give the investors and the users of the blockchain an upper hand over the miners. With a POS system, miners will need to spend more time and resources to mine Ethereum, making it less feasible. Furthermore, the time consumption and difficulty of mining a block is directly related to the number of blocks mined over time. This action is said to eventually slow down the block mining process in large numbers as the monetary benefits of mining Ethereum will go down exponentially, losing more miners to other, more feasible, blockchains.
A digital code generated by key encryption that is attached to an electronically transmitted document to verify its contents and the sender’s identity. It is a digital code one generates using their public-key privatekey pair. This alphanumeric code is then used to digitally sign transactions before broadcasting to the network. The validators can verify the code and public address and determine its authenticity without needing to know the private key.
The technology underlying distributed ledgers. This term is most often discussed in the context of enterprise use cases around adoption of distributed ledger technology. The technology which creates a ledger that remains as a distributed shared resource among all participants of a P2P network. Blockchain is one such technology.
A type of network where processing power and data are spread over the nodes rather than having a centralized data center. A group of interconnected computers who participate through a common protocol to transact among each other, collectively process such transactions and record the data thus generated among all the participants of the network.
The allocation of capital into a range of asset classes. This method helps in reducing the risks linked with holding onto one single class of asset, such as stock, commodities, bonds and cryptocurrencies. The main purpose of this method is to add value to any portfolio by reducing the risks of probable losses and yielding better longterm returns. This strategy is not limited to holding multiple asset classes but can also be done within any particular asset class, for example in the asset class of cryptocurrencies by holding multiple kinds of coins and tokens which have different purpose from one another.
A situation where a sum of money is (illegitimately) spent more than once. The act of spending a resource over and over again without having to restore the resource through acquisition. This can happen if a single spend does not exhaust the spending power of that resource.
DYOR might perhaps be the most used term after Bitcoin. DYOR as mentioned above stands for Do Your Own Research, which is rather straight forwardly stating that any cryptocurrency enthusiast should do their own research and no reply on their peer’s experience and knowledge to invest into cryptocurrency. As the cryptocurrency market is very volatile, it is easy to suffer a loss rather than securing evident profit if any investor or trader has not done their thorough research on the tokens, coins, or assets they are eyeing. Doing proper research is essential to assessing which asset will be beneficial in the long run and which asset might go down exponentially in the near future.
Minuscule transactions that flood and slow the network, usually deliberately created by people looking to disrupt it. A large number of transactions with very small insignificant amount of transfers. These are done with malice intention of engaging network resources in processing the less valuable, making the network processing capacity slow and inefficient.
A well-planned attack with the sole purpose to attack a particular set of users by isolating them and blocking their field of vision of the peer-to-peer network. This can create disruption between the users, making it easier for the attack to go ahead and attempt more attacks in a sophisticated manner.
It is a theory stating that the price of assets and all the relatively available information on the same is reflected in the financial markets; seeing a fair price in the value of the assets. In theory, the exchanges are trading stocks at a fair value; so the assets cannot outperform through market timing or expert stock selection. Making it possible to only yield higher returns by investing assets with higher risks involved.
The conversion process of a clear and direct information into a piece of code making that information accessible only to the authorized parties. This technique is highly used in various fields to ensure safety and security to private information and helps reduce risk of infiltration or fraud. The data is converted into ciphertext from a plaintext and can only be access by those who have the key to decrypt the information, converting the ciphertext into a plaintext.
A group of Ethereum developers, startups and large corporations working together to commercialize and use Ethereum for business applications. In order to help the enterprises develop business solutions using Ethereum platform, this group of developers, startups and corporations work together and are known as EEA.
A token standard for Ethereum, used for smart contracts implementing tokens. It is a common list of rules defining interactions between tokens, including transfer between addresses and data access. A scripting standard used within the ethereum blockchain which dictates a number of rules and actions to be followed by an Ethereum smart contract or token in order to implement it.
A token standard for non-fungible Ethereum tokens. An Ethereum Improvement Proposal introduced in 2017, it enables smart contracts to operate as tradeable tokens similar to ERC-20 tokens. A scripting standard used within the ethereum blockchain in order to create unique tokens or non-fungible tokens on the blockchain. Such tokens are one of a kind and rare.
An escrow is a contractual arrangement in which a third party receives and disburses money or documents for the primary transacting parties, with the disbursement dependent on conditions agreed to by the transacting parties. This is possible to be automated using smart contracts on the blockchain. A mechanism through which a custodian holds the contractual obligations of the parties involved in a contract till all parties fulfill their obligations. Once done, the escrow then settles the contract by executing the exchange of obligations between parties. Otherwise, the obligations are returned to the original owner - avoiding any counterparty risk in the process.
Ethereum is a blockchain-based decentralized platform for apps that run smart contracts, and is aimed at solving issues associated with censorship, fraud and third party interference. A public blockchain launched in 2015 which can be used for multipurpose activities - popularly used in enterprise applications causing decentralized processing and efficient execution of business operations.
A security that tracks a basket of assets such as stocks, bonds, and cryptocurrencies but can be traded like a single stock. A fund which invests in a disclosed set of assets offered over reputed exchanges. The returns thus generated are distributed to the subscribers on a pro-rata basis.
A situation when a trader enters a position expecting a price movement or a future transaction signal but there no development in the movement instead the price starts going in the opposite direction to the one anticipated, leading to a substantial loss for technical analysts. Generally, technical analysts rely on data and patterns to find a perfect fit for their strategies in order to make profit; but due to unforeseen situations and factors out of their control, the price can reverse in a blink of an eye turning that trade into a surprising and substantial loss.
The situation when the price of an asset depletes rapidly is termed as Falling knife; as when graphed, there is a sharp downtrend in the price.
A cryptocurrency reward system usually on a website or app, that rewards users for completing certain tasks. It is mostly a technique used when first launching an altcoin to interest people in the coin. A Faucet is like an Airdrop which is used to distribute free tokens to early adopters in order to increase the uses of the cryptocurrency coin or token.
A legal tender issued by a government or a central bank such as Federal Reserve which issues US Dollars and Reserve Bank of India which issues Indian Rupees. The legal tender of any country issued by its central bank.
Also known as ‘pegged cryptocurrency,’ it is a coin, token or asset issued on a blockchain that is linked to a government or bankissued currency. Each pegged cryptocurrency is guaranteed to have a specific cash value in reserves at all times. Also known as stablecoins, these digital assets represent a fiat currency by value. The issuers of such assets have to keep equal amount of fiat currency assets as a collateral with an appointed custodian.
A given guarantee or assurance when cryptocurrency transactions are completed to ensure that they cannot be reversed, altered, or canceled. In cryptoverse, finality is often used by entities accepting cryptocurrencies as a mode of payment as the high waiting period on any blockchain network may bring an unfavorable effect on the entities recognizing cryptocurrencies as a means of payment
The competitive advantage gained by the first entity to introduce any new service or product into an unexplored industry. Being the first in the industry bringing a particular service, the entity gets an uncontested platform to set up a brand name, customer loyalty and market share. This gives the entity enough room to expand their business and create a larger target audience with no hurdles involved.
The term used to explain the Bitcoin Cash’s (BCH) market capitalization getting surpassed by Litecoin (LTC), giving LTC domination over the market and move value compared to BCH. Flappening is a play of the word “flippening’.
Coined in 2017, flippening is a term heavily used for the currently hypothetical situation of Ethereum surpassing Bitcoin’s market capitalization. In the cryptoverse, Bitcoin has set a gradual yet evident dominance ever since its launch. But in the past few years, Bitcoin has seen a drop in that dominance.
An acronym that stands for ‘Fear of Missing Out’ and in the context of investing, refers to the feeling of apprehension for missing out on a potentially profitable investment opportunity and regretting it later.
Converting assets into cash or securities involuntarily is termed as Forced Liquidation. A set of criteria is created, which when met forces the selling to happen automatically, thus getting the name. In cryptoverse, forced liquidation is triggered when traders are facing shortcomings in their account; when the trader is having difficulty bringing the account over the margin to fulfill the requirements set of any leveraged position.
Forks create an alternate version of the blockchain, leaving two blockchains to run simultaneously on different parts of the network. Forks are splits in the ledger due to change in protocol or just network communication issues. It essentially means that two or more parallel branches occur with one common block as the parent block of the multiple chains which subsequently grow independently. They compromise the ledgers’ function as a single source of truth.
An acronym that stands for ‘Fear, Uncertainty and Doubt.’ It is a strategy to influence perception of certain cryptocurrencies or the cryptocurrency market in general by spreading negative, misleading or false information.
A program responsible for validating and implementing rules for transactions and blocks on a blockchain.
A measurement method used mainly to evaluate any asset’s value by studying the quantitative and qualitative factors. Fundamental analysis helps verify the price of any asset; to evaluate if its is undervalued or overvalued. Fundamental Analysis also considers any factors that might affect the value in the future which might not be evident immediately; thus, helping analyze the potential any asset can reach in the future. Macroeconomic and microeconomic factors are considered to identify how the market is affected by those conditions. Fundamental Analysis is used heavily in cryptoverse to analyze the price and evaluate tokens, coins and assets.
The ability of any particular token or an asset to replace its units with another identical token or coin, making them mutually interchangeable, is termed as fungibility. In cryptoverse, most tokens or cryptocurrencies are fungible; meaning all the units of a token hold the same value and are equivalent, irrespective of their mining source / block or how they were generated.
As the name suggests, it is a contract that is set in place to trade a particular asset or commodity at a previously set price and time in the future. The future contract includes the details of the specific quantity of the units to be traded along with its exact price and the time at with the said trade will happen. This contract is made in agreement of both the parties involved, the buyer and the seller; and this binds them to act on it accordingly. Generally, the settlement is done when the contract reaches its said expiration date and at that point both the parties are obligated to trade the asset at the predetermined price.
A term used on the Ethereum platform that refers to a unit of measuring the computational effort of conducting transactions or smart contracts, or launch DApps in the Ethereum network. It is the “fuel” of the Ethereum network. It is the unit of reward provided to the validators in the Ethereum Network to process the transactions. It exists only in the operational part of the Ethereum Virtual Machine and can be purchased or sold against Ether.
The maximum cost any cryptocurrency user is agreeing to bear to send a transaction across the network in the ethereum blockchain. Gas limit is set in place to reduce exploitations and overcharged fees caused by errors or bugs in a smart contract. The cost limit varies on the intricacy, the number of resources required, of the transaction and the transaction speed required by the user. Generally, achieving a faster transaction will cost a higher fee and will more likely be successful and get confirmed easily. Whereas a lower fee will take a lot of time to confirm which sometimes leads to the transaction getting stuck, leading to a failed transaction.
A license which gives access and rights to anyone on a computer program so they can openly read, write, copy, use, edit, distribute, and share it. This license is free and copyleft in nature, meaning anything derived from a computer program under this license can be published but it should follow the licensing terms of the original work.
The first block of data that is processed and validated to form a new blockchain, often referred to as block 0 or block 1. The first block of any blockchain.
A pattern in a technical chart when a longer-term moving average is crossed by the shorter-term moving average.
An open-source web-based development platform which allows its users, both registered and un-registered, to download, view and edit the filed uploaded on the platform. GitHub‘s purpose is to support collaboration between its users and help multiple developers to collaborate on a project simultaneously across the world. GitHub gained traction and became the largest open-source code platform mainly because of its features and cost-effectiveness. An exceedingly versatile platform, GitHub has helped numerous developers achieve enhanced productivity and collaborate efficiently. In cryptoverse, GitHub has been indispensable as it acts as the home to most of the popular blockchain-based projects, namely Bitcoin, Stellar, Ethereum, Cardano, etc; and these published projects attract a wide traffic as developers contribute to the coding of these projects from across the globe.
A type of peer-to-peer communication that happens when information travels through various computer nodes between computer and other digital devices, all a part of a distributed network, reaching across network to all the devices connected.
A governance token is a token that can be used to vote on decisions that influence an ecosystem. It is the token used to vote for any decision process within the decentralized participant group regarding any proposal in changes in protocol etc.
A unit of Ether, a cryptocurrency of the ethereum blockchain. Aside ETH, Gwei is used excessively in terms of gas. Generally, Gwei stands for one-billionth of ETH, meaning 1 Gwei is equivalent of 10 -9 ETH.
Any person that holds expertise in computing, programming and cybersecurity and is using that knowledge to be involved in illicit, illegal, and unethical activities through a computer system or network.
Bitcoins have a finite supply, which makes them a scarce digital commodity. The total amount of bitcoins that will ever be issued is 21 million. The number of bitcoins generated per block is decreased 50% every four years. This is called “halving”. The final halving will take place in the year 2140.
The maximum amount that an ICO will raise. If a hard cap is reached, no more funds will be collected.
A type of fork that renders previously invalid transactions valid, and vice versa. This type of fork requires all nodes and users to upgrade to the latest version of the protocol software. A Hard Fork happens when the user community of a cryptocurrency changes the protocols of the existing blockchain in order to create a new ledger on its own. The Ethereum community executed the London Hard Fork to begin transitioning from a Proof-of-work consensus algorithm to a Proof-of-Stake protocol.
The act of performing a hash function on the output data. This is used for confirming coin transactions. Hash is short term for Hash Algorithm - a cryptographic function which lends a unique fixed length alphanumeric code to a variable length input.
Hashlock Keys are conditional constraints on a smart contract which permits the contract to be executed only upon receipt of transaction hashes confirming the conditions of the contract.
Measurement of performance for the mining rig is expressed in hashes per second. Mh/S (mega hash per second) is the speed that a graphics processor, GPU, can hash per second. It is a measurement of the processing speed of a mining setup.
A wallet that uses Hierarchical Deterministic (HD) protocol to support the generation of crypto-wallets from a single master seed using 12 mnemonic phrases. Also known as Deterministic Wallet. It is a system where the keys to a wallet are derived from a single starting point called seed. The seed can be stored in human-readable words in a seed phrase and can be used to easily backup and restore a wallet.
HODL is used for ‘hold’ - it’s a term that was invented by a person who did a typo and it became famous. Whenever people talk here (reddit website) about holding their coins, they would rather say “hodl your bitcoins”. Also “hold on for dear life”. Crypto slang for HOLD - acronym to Hold On with Dear Life.
An approach taken for security measures of a computer which helps identify or neutralize any unapproved access of information systems.
A wallet managed by a third-party service.
The online storage of private keys allowing for quicker access to cryptocurrencies. Susceptible to hack attempts / attacks.
Used in Atomic swaps, these smart contracts use hashlock keys to confirm receipt of cryptographic proof of transaction obligation and timelock keys to set deadlines to the transaction execution.
Hyperledger is an umbrella project of open source blockchains and blockchain-related tools started by the Linux Foundation in 2015 to support the collaborative development of blockchainbased distributed ledgers. A collection of Distributed Ledger Technology stack for providing permissioned cryptocurrency less systems to enterprises or consortiums for achieving efficiency in operations.
An order with conditions implied to it to ensure a large trade order of assets is predetermined to be traded in smaller qualities so the total amount of trade order can be hidden.
An object or feature which cannot be altered or changed once it is created is termed to have the ability of immutability. In cryptoverse, immutability is a feature that holds an evident place in blockchain technology and Bitcoin. Any transaction that is immutable will restrict any entity to edit, replace, manipulate, or create any false data that is being stored on the network. Immutability helps add to the efficiency and enhances the auditing system by reducing the cost and time of the audits. It also helps to verify any information in a more effective and a simpler manner.
Termed as a financial instrument which represents a combination of separate data points or prices. Indexes are typically used to measure and track how the stock market or a subset is performing. Every index has its own set of rules to follow and calculation methods to adhere to. Despite that, the index should reflect the precise change in the proportion of the stock into its value variations.
An Initial Coin Offering also called an ICO is an event in which a new cryptocurrency sells advance tokens from its overall coinbase, in exchange for upfront capital. ICOs are frequently used by developers of a new cryptocurrency to raise capital. An issuance event where investors are asked to invest in a project that is raising funds in order to develop the project.
An initial exchange offering (IEO) refers to a fundraising event where a cryptocurrency exchange raises money on its own platform, as opposed to an ICO, where a team conducts the fundraising. An issuance event where an exchange is raising funds in order to enhance the exchange business capabilities.
The concept used in cryptoverse, which allows the blockchain with the ability to be compatible to the rest of the blockchains and rely on other blockchains to build using their features and use cases.
A system with an open source that focuses on creating a peerto-peer system which is distributed across the network to help store, access and share files and data. IPFS has a system similar to blockchain to help achieve this peer-to-peer system.
A period in time, shortly after launch, when a large portion of total mineable coins or tokens are mined in a compressed time frame, and may be unevenly and quickly distributed to investors. The event where soon after its launch, a project mines certain amount of its tokens or coins to be distributed to the investors as per the issuance / fundraising contracts.
Internet of Things (IoT) is a global interconnected network of devices, sensors and software that can collect and exchange data with each other in real-time over the Internet. IoT refers to a smart technology where instruments fitted with sensors can interact with each other following a programmed protocol and carry out set activities on their own.
The assigned margin balance for any specific position is termed as isolated margin. This allotment helps in risk management of the positions of the traders by setting restrictions on the margin amount assigned to each of the traders. This margin balance is customizable for every position.
In cryptoverse, Issuance stands for the process of generating fresh tokens which then can be added to the entire quantity of any cryptocurrency. Generally, tokens are created through mining but the whole process of issuance can happen in various ways in accordance with the parameters set by the project’s creators.
The smallest unit of a BNB is termed as a Jager.
The process of gathering details of a customer, down to their contact information and identity proofs is termed as the KYC process. The KYC process is generally done by banks and similar financial entities for the database to keep track of their existing or future customers. The mean purpose of the KYC process is to prevent any illegal activities such as money laundering, fraud, etc.
Generally termed as the time delay it takes for the output to be received once the input has been made. In cryptoverse, latency is used as a term for the time delay within a blockchain network and also in an exchange.
A book or a file of a physical or a digital manner containing all the financial and monetary transactions and the trails is termed as a ledger. Ledger is used to keep a track record of all the monetary movement, especially the debits and the credits. It can also contain the balance or the amount any person or the entity is holding in their account. Ledgers are used in various fields for their financial matters, to track purchases, sales, trades or exchanges.
The Lightening Network is a “second layer” payment protocol that operates on top of a blockchain. Theoretically, it will enable fast, scalable transactions between and across participating nodes, and has been touted as a solution to the Bitcoin scalability problem. The Lightening Network is a Layer 2 Protocol which solves the scalability problem of Layer 1 protocols like Bitcoin blockchain. It processes a number of transactions on its own and periodically registers the net of those transactions on the Layer 1.
A peer-to-peer cryptocurrency based on the Scrypt proof-of-work network. Sometimes referred to as the silver to bitcoin’s gold. Litecoin was created as a Hard Fork of Bitcoin on October 13, 2011. The project led by Charlie Lee is supposed to be an improvement over Bitcoin with 4 times faster transaction processing, using Scrypt instead of SHA-256 as hashing algorithm
The ability to trade any asset without having any massive effects on the market is termed as liquidity. Any market that is liquid is seemed to hold a higher ground as it makes trading the asset rather easier and much more convenient compared to the market with are not termed liquid.
Liquidity pools are crypto assets that are kept to facilitate the trading of trading pairs on decentralized exchanges. On a Decentralized Exchange, the liquidity pools are created to facilitate exchange of a pair of crypto assets. Liquidity providers lock-in their assets in the pools to facilitate exchange of assets for the trader. They receive a proportion of the transaction fees thus generated.
Liquidity providers are decentralized exchange users who fund a liquidity pool with tokens they own. Liquidity Providers are the people who lock-in their assets in the Liquidity Pool of the Cryptocurrency DEX. They receive a proportional transaction fees levied on the traders who use the liquidity pools to swap their assets at an algorithmically determined exchange rate.
The act of the shares of a company getting added to the list of the stock being traded on an exchange. There are certain criteria the company needs to fulfill in order to get onto the list and they need to follow a set of rules to stay on the list of any exchange.
It is an indicator very much used in technical analysis of coins and reading the charts to predict price movements in the near future. It stands for moving average convergence divergence and indicates the relationship between two moving averages of prices. It provides signal for a trending market – this should be analysed along with the Average Directional Index.
Total capitalization of a cryptocurrency’s price. It is one of the ways to rank the relative size of a cryptocurrency. It is a measure of total market value of a coin or token in dollar terms. It is the product of the total number of coins / token in supply and the market price of one coin/token in dollars.
Masternodes are a server maintained by its owner, somewhat like full nodes, but with additional functionalities such as anonymizing transactions, clearing transactions, and participating in governance and voting. It was initially popularized by Dash to reward owners of these servers for maintaining a service for the blockchain. These are special nodes operating in Proof-of-Service (Pose) blockchains like Dash. They provide some important service to the blockchain against a reward. The Masternodes need to maintain their own servers to service the blockchain.
A node’s mechanism for keeping track of unconfirmed transactions that the node has seen (but have not yet been added to a block). Is the collection of unconfirmed transactions broadcasted to the network. The miners/validators pick the transactions from the Mempool, verify and validate them and put them in a block to confirm the transaction.
The process by which transactions are verified and added to a blockchain. This process of solving cryptographic problems using computing hardware also triggers the release of cryptocurrencies. This refers to the activity of picking up unconfirmed transactions from the Mempool, verifying and validating the same and putting them in a block and adding the block to the existing blockchain. Since this process generates a reward of freshly generated coins, it is conceptually compared to the process of adding new metal through the process of mining.
A setup where multiple miners combine their computing power to gain economies of scale and competitiveness in finding the next block on a blockchain. Rewards are split according to different agreements, depending on the mining pool. Another term for this is Group Mining. A pooling of computational resources in order to increase the chances of obtaining the mining reward. The reward thus received is then shared among the pool contributors.
The reward resulting from contributing computing resources to process transactions. Mining rewards are usually a mix of newlyminted coins and transaction fees. The incentive which the validators receive upon successful verification and validation of the network transactions and subsequently adding those transactions to the ledger.
A computer being used for mining. A mining rig could be a dedicated piece of hardware for mining, or a computer with spare capacity that can be used for other tasks, only mining part time.
A mnemonic phrase (also known as mnemonic seed, or seed phrase) is a list of words used in sequence to access or restore your cryptocurrency assets. It should be kept secret from everyone else. It is a standard in most HD wallets. Used in HD wallets - the seed to restore the keys is encrypted in user-recognizable phrase or sequence of words.
In the cryptocurrency space, when the price of a coin suddenly shoots up considerably it is termed as the ‘coin is mooning’ or going so high as to reach the moon.
Multi-signature addresses provide an added layer of security by requiring more than one key to authorize a transaction. Multi signature addresses have a much greater resistance to theft. MultiSig protocols require two or more private keys to authorize a transaction. The authorized signatories are identified by their Public Keys and their digital signatures provide the necessary condition for the Hashlock Key in such contracts to render the transaction message operational.
A no-coiner is someone who has no cryptocurrency in his or her investment portfolio and firmly believes that cryptocurrency in general will fail.
Participant of a peer-to-peer network who maintains a copy of the distributed ledger to aid in verification and validation of the transactions.
When a transaction is hashed by a miner, an arbitrary number meant to be used only once is generated, called a nonce. The missing piece of the cryptographic puzzle of a proof-of-work system. A miner needs to find the correct nonce to fit in with other parameters of the block to compute a block hash which conforms to the difficulty level specified in the block algorithm.
Usually referring to the storage of keys, in relation to wallets or exchanges. A non-custodial setup is one in which private keys are held by the user directly. Non-custodial wallets are the user controlled wallets.
Non-fungible tokens (NFTs) are cryptocurrencies that do not possess the property of fungibility. Unique tokens representing a specific piece of collectible. May be an art, music, property right, patent, etc.
The transaction happening outside of a blockchain are said to be Off-chain. These types of transactions are rather faster as no confirmations are required from the blockchain network. Furthermore, off-chain transactions also cannot be accessed on a blockchain as they’re not utilizing a blockchain for the process. Having low cost or being free of cost in certain situations, Off-chain transactions do not rely on any miner or accomplice to authenticate the transaction.
Storing wallet information like keys in storage devices not connected to internet.
Storing wallet information like keys in devices connected to the internet. These can be used faster than offline storage but also present a risk of theft.
Open source is a term that originally referred to open source software (OSS). In crypto, open source contracts/code are designed to be publicly accessible—anyone can see, modify, and distribute the code as they see fit. Publicly shared resources which can be used freely by anyone.
Oracles work as a bridge between the real world and the blockchain by providing data to the smart contracts. These are programs which provide some specific off-chain data to the blockchain environment to trigger conditional smart contracts.
A physical document containing your private key or seed phrase. When you write your password on a piece of paper it becomes your paper wallet.
An investment strategy that does not rely on a decision-making process and rather mirrors and tracks the performance of an index to improve the portfolio.
It is a kind of networking that is distributed amongst multiple devices on the same network. This type of network allows the users to share information and collaborate with their ‘peers’ on the same network; and it also allows equality between users, reducing any advantage or discrimination within the peers. A P2P network is managed by the peers without any central host or a server making it resistant to any sorts of cyber-attacks.
Also known as stablecoin, a pegged currency replicates the price of its assigned asset.
A ledger designed with restrictions, such that only people or organizations requiring access have permission to access it. It is a ledger which can only be accessed if you have permission of the controlling authority.
Often used to describe blockchains, a system is said to be permissionless when there is no entity that can regulate who can use it and how it can be used. A transparent ledger which can be accessed by anybody to append the ledger one has to go through a set of rules and protocols decided by the participating community.
A common technique used in cyber-attacks which heavily relies on tricking the receivers into revealing their private and sensitive information related to their identity and financial assets. Phishing mostly approaches the targets with a misleading email or a text message related to the wallet’s security; this message has a link they should click on to improve the security and requires the access key and password. Once the said details are entered into the link, the target loses all his assets and gets scammed by this cyber-attack.
Built using Merkel trees and smart contacts, the plasma framework helps create multiple side chains which can be termed as a compact replication of the Ethereum blockchain. Plasma is a side chain framework for scaling solution specifically designed for the Ethereumnetwork which engaged with the ethereum blockchain in a cautious manner. The efficiency of the Etheruem network is increased exponentially using the plasma framework as it takes over a huge part of the duties of processing from the ethereum network and divides it into a set of tiny, efficient chains.
Ponzi scheme is a type of financial scam which uses investments as a way to fraud the investors or the interested parties. This scheme lures in new investors to collect the money to pay off the old/existing investors. New investors are generally attracted by promising them high returns or life altering profits in return for their investment. It is named after Charles Ponzi, an Italian scamster who gained attention for this style of frauds executed by him in the early 1920s in North America.
When some or all of a coin’s initial supply is generated during or before the public launch, rather than being generated over time through mining or inflation. They may be used for legitimate purposes, such as crowdfunding or marketing. Pre mine is the event in which the cryptocurrency coins or tokens are generated and distributed before the launch of the project.
A sale that takes place before an ICO is made available to the general public for funding. Pre-sale is an event generally organized to raise funds to begin or launch a project.
The plotted price of an asset’s movement over a period of time on a chart is termed as price action. All kinds of technical analysis rely heaving on price action to chart various assets such as commodities, stock, cryptocurrency, forex, bonds, etc.
A private key is a string of data that allows you to access the tokens (cryptocurrency) in a specific wallet. They act as passwords that are kept hidden from anyone but the owner of the address. A private key is like your password which are used to send cryptocurrencies.
The set of rules that define interactions on a network, usually involving consensus, transaction validation, and network participation on a blockchain.
A public address is the cryptographic hash of a public key. They act as email addresses that can be published anywhere, unlike private keys. A public key is your wallet address to which others can send cryptocurrencies.
A blockchain that can be accessed by anyone.
A form of securities fraud involving the artificial inflation of the price of a cryptocurrency with false and misleading positive statements in order to sell previously-cheaply purchased stock at a higher price. Is the process through which some participants with malicious intentions pump the prices of an asset up in order to encourage others to keep purchasing and when the larger demand comes in they usually sell off booking their profit.
An off-chain scaling solution aiming to enable near-instant, lowfee and scalable payments on the Ethereum blockchain. It is similar to Bitcoin’s proposed Lightning Network. The Raiden Network is a Layer 2 Protocol which solves the scalability problem of Layer 1 protocols like Ethereum blockchain. It processes a number of transactions on its own and periodically registers the net of those transactions on the Layer 1.
A kind of malware with the intention to manipulate its victims by asking for ransom in return of their compromised files or data. This does not come with the guarantee that the hacker will return their data or files to them and honour the transaction as there are cases when they simply vanish with the money and the files. In the recent times, these ransoms have been asked in digital currencies to avoid getting traced and for payment to go scot free.
A shorthand slang for “wrecked,” describing a huge loss in a trade and almost going bankrupt with that loss.
A technical analysis indicator which helps in analyzing the rate at which the price is moving and the changes of the movement. This indicator is used to identify any overbought or oversold conditions in the market. Resulting in a comprehensive analysis, RSI helps trace any potential in the market trends.
A termed widely used in trading and investment, ROI or Return on Investment is a term used to identity the value of profit or return any investment or a trade can yield. ROI is generally identified as a ratio or a percentage making it simple to use and understand. It is heavily used to compare various kinds of investments and opportunities. ROI represents the calculated return which can be yielded by any investment in comparison to the buying price.
A payment network built on distributed ledgers that can be used to transfer any currency. The network consists of payment nodes and gateways operated by authorities. Payments are made using a series of IOUs, and the network is based on trust relationships. The banking industry is adapting this platform.
A malicious action which was the talk of the town after the Squid Game token scam in 2021.Rug pull is a scamming method where the developers of any cryptocurrency abruptlyabandon the project and disappear with its investor’s assets. Investors are generally tricked by setting that the coin price skyrockets within a short duration creating a feeling of FOMO and making them feel compelled to invest into the coin.
The smallest unit of bitcoin with a value of 0.00000001 BTC. The 100 millionth part (10-8) smallest unit of a bitcoin.
An alternative proof of work system to SHA-256, designed to be particularly friendly to CPU and GPU miners, while offering little advantage to ASIC miners. A fraudulent or deceptive cryptocurrency or ICO.
A set of solutions built on top of a public blockchain to extend its scalability and efficiency, especially for micro-transactions or actions. Examples include Plasma, TrueBit, Lightning Network and more. These projects are dependent on a specific layer 1 protocol and they provide scalability solutions to their base protocols.
A single starting point when deriving keys for a deterministic wallet. It is usually presented as a series of words to enable the owner to quickly backup or restore a wallet. Used in hardware wallets, stored by users as a mnemonic phrase, the seed represents the object which can generate keys to restore the specified wallet.
SegWit was an update to the Bitcoin protocol and stands for ‘segregated witness consensus layer’, a technological feature created to optimize transactions in 2015. SegWit is the process by which the block size limit on a blockchain is increased by removing signature data from Bitcoin transactions. When certain parts of a transaction are removed, this frees up space or capacity to add more transactions to the chain. A single starting point when deriving keys for a deterministic wallet. It is usually presented as a series of words to enable the owner to quickly backup or restore a wallet. It is a process by which the transactions data and the signature data is segregated and stored separately to allow more transactions to be stored in a block of limited size.
SHA-256 is a cryptographic algorithm used by cryptocurrencies such as Bitcoin. However, it uses a lot of computing power and processing time, forcing miners to form mining pools to capture gains.
Sharding is a scaling approach that enables splitting of blockchain states into partitions containing states and transaction history, so that each shard can be processed in parallel. Sharding is the process of partitioning the entire ledger data and working with a relevant shard to process transactions faster.
A blockchain ledger that runs in parallel to a primary blockchain, where there is a two-way link between the primary chain and sidechain. This allows the sidechain to operate independently of the primary blockchain, using their own protocols or ledger mechanisms. Is a side blockchain linked to another blockchain which is known as the main chain.
A lightweight client to verify blockchain transactions, downloading only block headers and requesting proof of inclusion to the blockchain in the Merkle Tree. Is a transaction receipt proof signifying the senders control of the source funds.
The minimum amount that an initial coin offering (ICO) wants to raise. Sometimes, if the ICO is unable to raise the soft cap amount, it may be called off entirely. Is the minimum capitalization target which an issuance project has to begin the project.
A soft fork differs from a hard fork in that only previously valid transactions are made invalid. Since old nodes recognize the new blocks as valid, a soft fork is essentially backward-compatible. This type of fork requires most miners upgrading in order to enforce, while a hard fork requires all nodes to agree on the new version.
Solidity is Ethereum’s programming language for developing smart contracts. Programming language for Ethereum is called Solidity.
Smart contracts are contracts whose terms are recorded in a computer language instead of legal language. Smart contracts can be automatically executed by a computing system, such as a suitable distributed ledger system. Smart contracts are programs stored on a blockchain which execute when the pre-requisites are met.
A cryptocurrency with extremely low volatility, sometimes used as a means of portfolio diversification. Examples include goldbacked cryptocurrency or fiat-pegged cryptocurrency. A cryptocurrency whose value is pegged to any fiat currency.
Participation in a proof-of-stake (PoS) system to put your tokens in to serve as a validator to the blockchain and receive rewards. The process of giving up a part up of their cryptocurrency holdings to the network in order to obtain validation privileges so that one can validate transactions, mine new blocks and earn mining reward.
A pool where stakeholders combine their staking power to increase their chance of successfully validating a new block. A group of miners that combine resources to increase their chances of earning block rewards.
A second-layer scaling solution that reduces the total on-chain transactions necessary, moving the transactions off-chain and letting participants sign to the main chain after multiple off-chain transactions. The state channel is a Layer 2 Protocol which solves the scalability problem of Layer 1 protocols like Etherium blockchain. It processes a number of transactions on its own and periodically registers the net of those transactions on the Layer 1.
The Tangle is a blockchain alternative developed by IOTA, using directed acyclic graphs which only builds in one single direction and in a way that it never repeats, and is quantum-computing resistant. It is a distributed ledger technology which uses acyclic graphs instead of blockchain as their underlying data structure.
A test blockchain used by developers to prevent expending assets on the main chain. Is an alternative bitcoin blockchain and Is used for testing and experimentation without risk to real funds.
A form of identification for when a certain transaction occurred, usually with date and time of day and accurate to fractions of a second. Is an accurate record of the time of the transactions that taken place on the blockchain.
A digital unit designed with utility in mind, providing access and use of a larger crypto economic system. It does not have a store of value on its own, but is made so that software can be developed around it. Represents a digital asset which is dependent on public blockchain but has a protocol of its own representing a specific decentralized application, or an unique item.
These are timestamp conditional constraints on a smart contract which enables the contracting parties set a timestamp deadline to execution of the contract. Once deadline is crossed, the contract will auto expire without execution.
Is an alternative bitcoin blockchain and Is used for testing and experimentation without risk to real funds.
All cryptocurrency transactions involve a small transaction fee. These transaction fees add up to account for the block reward that a miner receives when he successfully processes a block. Is a fee charged to users for enabling crypto transactions.
The process by which real-world assets are turned into something of digital value called a token, often subsequently able to offer ownership of parts of this asset to different owners. It represents issuing digital tokens against any real world tradable assets. Collaterals of that particular asset are deposited with a custodian who issues the digital tokens.
The act of exchanging cryptocurrencies on a blockchain.
A property of the blockchain, where no participant needs to trust any other participant for transactions to be enforced as intended. Is the term which represents that the system does not require to establish trust between tracking parties. The trust is generated through cryptographic proof of transactions.
A state in which a transaction has not been appended to the blockchain.
An output of a blockchain transaction that has not been spent, and can be used as an input for new transactions.
A participant on a proof-of-stake (PoS) blockchain, involved in validating blocks for rewards. Is a network participant in the peer to peer network who does the job of verifying and validating the transactions.
The rate and range of fluctuation in the price of any asset is the volatility of that asset. It is measured through the standard deviation or variance in an asset’s annual return over a set time. Volatility is an effective and efficient way to analyze the risks involved with investing in an asset.
It is an application which stores private keys.
The smallest fraction of an Ether, with each Ether to 1000000000000000000 Wei. It is the smallest unit of an ether. The 100 quintillionth part (10-18) of Ether.
A term used to describe investors who have uncommonly large amounts of crypto, especially those with enough funds to manipulate the market. A commonly used term for a big trader who holds significant amounts of cryptocurrencies.
A document prepared by an ICO project team to interest investors with its vision, cryptocurrency use, crypto economic design, technical information, and a roadmap for how it plans to grow and succeed. A project document which describes the purpose, project road map, technology used and tokenomics of that particular project.
A method to verify situations or a piece of information without revealing the information. This method is generally used between a verifier and a prover. In cryptoverse, these systems are heavily utilized to add more layers of security and privacy by eliminating the need of revealing the public address or signature amongst other things. ZK proofs require the fulfillment of two criteria; completeness and soundness. Completeness is the prover’s ability to present a higher level of detail and accuracy on the knowledge of the information; and soundness is verifier’s ability to determine that the prover holds the information in their possession.
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