THE MOST POPULAR
CRYPTOCURRENCY TERMS AND PHRASES
CRYPTOCURRENCY
Due diligence is important when looking into any asset
class. However, doing one's homework may be even
more important when it comes to digital currency, as
this asset class has been around for far less time than
more traditional assets (like stocks and bonds) and
comes with substantial uncertainty.
Are you prepared to get to know cryptocurrency
trading terms and some basic cryptocurrency terms
no human being can live without?
Conducting the proper research on cryptocurrencies
may require a would-be investor to explore many
areas. One area in particular that could prove helpful
is simply learning the basic industry terminology.
Certain lingo is highly unique to digital currency,
making it unlikely that traders would have picked it up
when studying other asset classes like stocks, bonds
and commodities.
This article will explore the more popular terms and
phrases relevant to cryptocurrencies, providing a
strong foundation for those interested in exploring
this innovative asset class.
ADDRESS
In digital currency, an address is basically a destination
where a user sends and receives digital currency. In a
way, it is similar to a bank account.[1] These
addressses usually include a long series of letters and
numbers.
ALTCOIN
An altcoin is a digital currency other than bitcoin.
There were more than 1,000 altcoins listed on data
source CoinMarketCap at the time of this
writing. Another way of describing the term "altcoin"
is referring to it as an alternative protocol asset,
meaning that it follows a protocol (set of rules) that's
different than that of bitcoin.
ARBITRAGE
In crypto, arbitrage refers to taking advantage of the
price difference between two different exchanges. If
bitcoin is selling for £8,950 on one exchange and
£9,000 on another, a trader can buy the digital
currency on the first exchange and sell it on the
second for a modest profit.
ATH
"ATH" is an abbreviation of "all-time high." This term
can be quite helpful to know for tracking the digital
currency markets. These assets are so volatile, so
keeping their ATH in mind can prove valuable. A
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digital currency could potentially hit several local
highs before rising to a new all-time high.
Bear/Bearish
"Bears" believe that an asset, for example a digital
currency, will decline in value. Another way of putting
this is that if a trader thinks a cryptocurrency will
depreciate, their sentiment surrounding the digital
asset is "bearish." In many situations, traders will
make use of this expectation by taking a short position
on an asset, meaning that they will make a wager that
will pay off should the asset in question fall in value.
Blocks
Many digital currencies make use of blocks, which
contain transactions that have been confirmed and
then combined together.
BLOCKCHAIN
The blockchain, which is a distributed ledger system,
consists of a series of blocks. These blocks contain
verified transactions. The blockchain was designed to
be not only decentralised, but also immutable,
meaning that entries could not be erased once placed
on this distributed ledger. The idea of the blockchain
was first introduced when the bitcoin white paper was
released in late 2008.[3]
BULL/BULLISH
If a trader believes that an asset will rise in value, he
or she is a "bull." When an investor has this optimistic
expectation of an asset's future bull, this frame of
mind is described as "bullish."
CONSENSUS
The network for a digital currency reaches consensus
when the network's nodes agree that a transaction
took place. This agreement is crucial if the varying
network participants (nodes) are to have the same
information. In other words, consensus is crucial to
distributed ledger systems.
CRYPTOCURRENCY
A cryptocurrency is merely a currency that relies on
cryptography. Bitcoin, for example, leverages
cryptography in order to verify transactions.
CRYPTOGRAPHY
Cryptography is basically the process of encoding and
decoding information so that would-be observers are
unable to understand the information being sent.
DDoS ATTACK
A distributed denial of service (DDoS) attack takes
place when multiple parties work together to
overwhelm a system by inundating it with either
requests for information or malicious data. Basically,
the nefarious parties involved in such an attack want
to prevent a resource, such as a server, from being
able to provide some specific service, such as serving a
web page.

Some digital currency exchanges have suffered DDoS
attacks from nefarious parties looking to cripple these
marketplaces and hopefully take advantage of this
vulnerability to steal cryptocurrency. While efforts to
steal digital assets may not work, an exchange's users
could become unhappy simply because they cannot
make trades through the marketplace.
DISTRIBUTED LEDGER
A distributed ledger is a system of recording
information that is simply distributed, or spread
across, many different devices. The blockchain, for
example, is a distributed ledger that was originally
created to keep track of all bitcoin transactions.
ESCROW
Escrow refers to a third-party holding financial
resources on the behalf of other parties. A third-party
would hold funds in escrow when the other entities
involved in a transaction may not trust each other.
FIAT CURRENCIES
Fiat currencies are currencies that have value because
they are minted by a central bank. Fiat means "by
decree," and these currencies have value because
some central authority has decreed that they have
monetary value. Examples of fiat currencies include
the British pound, euro and Japanese yen.
EXCHANGES
Exchanges are basically just marketplaces where
traders can make digital currency transactions. If a
person wants to buy bitcoin, going to an exchange is
the fastest way to accomplish this objective.
FOMO
The term "FOMO" stands for the phrase "fear of
missing out." This occurs when investors start buying
up a particular asset based on their expectations that
it will rise in value. Market participants can easily flock
to an asset should that asset experience sharp gains.
Getting caught up in FOMO can be dangerous. More
specifically, buying up an asset because it has recently
enjoyed some notable upside can cause one to fall
victim to market manipulation.
Fork
A fork is a change in a digital currency's rules or
protocol. Developers update a cryptocurrency's
protocol from time to time. A fork can be either a hard
fork or a soft fork. A hard fork is a change to a digital
currency's protocol that makes blocks created using
the old protocol incompatible with the new chain.
FUD
Fear, uncertainty and doubt can be summed up using
the term "FUD." The idea behind this is that market
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participants may spread misleading or inaccurate
information in order to cause an asset's price to
decline. A trader may want an asset's price to fall so
they can either short it successfully or buy in at a
lower price and increase their chance of generating a
gain.
HARD FORK
A hard fork is a type of fork that creates a permanent
change to a digital currency's protocol, or
rules.[7] When one of these forks takes place, it
results in a whole new blockchain, which will not
accept any blocks mined using the old rules.
The old chain can survive, however, leading to a
scenario where both the old and the new blockchains
can continue.
HODL
Cryptocurrency investors developed the term "HODL,"
which stands for "hold on for dear life." The acronym
originally came from a misspelling of the word
"hold."[9] Digital currencies can be highly volatile, so
when they start experiencing significant price
fluctuations, some market participants state that they
should simply "HODL."
INITIAL COIN OFFERING
An initial coin offering (ICO) represents the first time
that an organisation offers digital tokens to the public
in an effort to raise money. Companies frequently
hold these offerings so they can finance projects.
These digital token sales have often been likened
to initial public offerings (IPOs), where companies sell
more traditional assets such as stocks and bonds in
order to raise money.
KYC
KYC stands for "know your customer." Many
jurisdictions have KYC regulations, which have come
to affect startups holding ICOs. These regulations
require companies holding these digital token sales to
verify the identity of their investors.
LONG/LONG POSITION
Going long, also known as taking a long position,
means making a wager that an asset will rise in value.
If a trader purchases a digital currency like bitcoin, for
example, they are making a bet that the
cryptocurrency will appreciate.
While simply buying digital currency is one example of
taking a long position, there are other methods
available. For instance, traders can leverage options
and futures.
MARKET CAP
Market cap is short for market capitalisation, which is
a term for total market value. The market cap of
bitcoin, for example, is the number of BTC
outstanding multiplied by the digital currency's price.
The term can also be used to refer to a group of digital
currencies.
MINING
Mining is the process for creating new units of a
digital currency. For example, the bitcoin network
releases new bitcoins every time a block is mined. In
this instance, mining involves confirming transactions
and combining them in to blocks.
This verification requires hardware and electricity, and
miners are rewarded with digital tokens for
contributing these needed resources.
Mining Incentive.
The mining incentive is a reward that miners get for
confirming transactions and mining them in to blocks.
Verifying the transactions of the bitcoin network, for
example, requires specialised hardware and
substantial electricity, so miners are compensated
with a mining incentive.
Initially, bitcoin's mining incentive was 50 BTC, but at
the time of report, the reward had dropped to 12.5
BTC.
MOON/MOONING
When a digital currency moons, that means it rises
sharply in value. For example, a crypto trader could
talk about how an altcoin is going "to the moon!"
NOOB
Newcomers are frequently described as "noobs" by
industry insiders. If you are this person, you may want
to sit back and observe before "jumping in with both
feet." Digital currencies are highly volatile, so those
who are newer to these assets should keep their risky
nature in mind.
POW
POW is an acronym for "proof of work," which is a
system of proving that a digital currency's transactions
have been verified. Many digital currencies, including
bitcoin, use POW. Under such a system, miners must
do "work" that is difficult for them to contribute, but
easy for the broader network to verify.
Miners are usually rewarded for verifying transactions
by receiving units of a digital currency.
POS
POS stands for "proof of stake," which is another
method of confirming transactions. The digital
currencies that use this approach to verification
frequently provide all their digital tokens up front, and
miners are selected based on how many units they
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have (their stake).[12] In these cases, users who
confirm transactions, sometimes referred to as
"forgers," receive transaction fees for their
contributions.
PRIVATE KEY
A private key is a piece of information presented as a
string of numbers and letters—that an investor can
use to access their digital currency.
PUBLIC KEY
A public key is an address where an investor can
receive digital currencies. This public key, like the
private key, is a combination of numbers and letters.
PUMP AND DUMP
A "pump and dump" is a type of investment scheme
where a market participant—or several—work
together to inflate the price of an asset so they can
sell it when its value is artificially high. This practice
may be particularly pervasive when it comes to digital
currencies, as traders can easily get together using
Telegram groups with the goal of causing specific
cryptocurrencies to rise sharply in value.[14]
REKT
The term "rekt" is crypto trader slang for "wrecked."
Basically, it means that a trader lost substantial
amounts of money.
ROI
ROI is short for "return on investment." Basically, if an
investor puts their money in to a digital currency, they
are doing so with the hope that they will receive a
compelling return.
SATOSHI NAKAMOTO
Satoshi Nakamoto is the pseudonym for the creator of
bitcoin, and more than one individual has claimed to
be Nakamoto. However, none of these claimants have
managed to convince the broader cryptocurrency
community that they are, in fact, the creator of
bitcoin.
SHORT/SHORTING
Shorting an asset, also known as taking a short
position, means making a bet that the asset will fall in
value. There are several methods that traders can use
to short digital currencies, including futures, options
and margin trading.
Investors considering this method should keep in
mind it involves a lot of risk, especially with
cryptocurrencies because of their volatile nature.
TOKEN
A digital token is a unit of a digital currency, such as a
bitcoin. It is worth noting that some of these tokens
are used for specific ecosystems, and those are
frequently referred to as utility tokens. Other digital
tokens are essentially securities.
WHALE
The term "whale" is used to describe a trader who
makes sizable bets. This term is a good one to know
because market participants with the ability to
execute very large transactions can potentially
manipulate the market—or "make waves in the
ocean."
WHITE PAPER
The developers who create digital currencies usually
provide white papers for these innovative assets.
These documents generally offer comprehensive
information on the digital token in question, as well as
its underlying technology.
For example, the bitcoin white paper provided
information on a "peer-to-peer electronic cash
system." Investors who are considering taking part in
ICOs can benefit greatly from reviewing any available
white papers on the subject.
SUMMARY
Investors who are thinking about getting involved with
cryptocurrency should keep in mind that industry
terminology can be hugely beneficial. By performing
the necessary research and learning this information,
would-be traders can increase their chances of
meeting their investment objectives.
Ultimate Glossary of Cryptocurrency Terms and
Acronyms (and How to Use Them)
Table of Contents
INTRODUCTION
Each industry develops its own terminology over time,
creating certain terms and a specific language which
aren’t always self-explanatory.
This can be a major challenge for a newcomer to a
market or industry, especially when they come across
terms and acronyms that don’t make any sense.
GUESS WHAT?
The cryptocurrency sector is no exception.
Knowing all the terms and acronyms can be a really
tricky endeavor, especially in the hyper-complex
realm of crypto affiliate marketing.
Even though this industry is relatively new, operators
in this space have developed a widely-accepted
terminology to define the functionality of
cryptocurrency exchanges and blockchain technology.
ADDRESS
Addresses consist of between 26 and 35 characters
and represent a unique wallet ID on the blockchain,
much like an account number.
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They’re used when conducting transactions on the
network, including the receipt, remittance, and
storage of cryptocurrency.
ALTCOIN
This usually refers to any cryptocurrency coin other
than Bitcoin, which was the original cryptocurrency.
ADVERTISEMENT
There are over 1,000 other cryptocurrencies in the
market.
BAGHOLDER
This is the name given to an investor who’s left
holding cryptocurrency after it has dropped in price.
BLOCKS
These are packages of permanently-recorded data on
the blockchain network.
BLOCKCHAIN
This is a distributed ledger secured using
cryptography. It’s a database that’s accessible for
everyone to read. Even so, data can only be changed
by ledger owners. Data isn’t stored on a centralized
server, but is instead shared by thousands of
computers around the globe.
COLD STORAGE
Cold storage refers to storing cryptocurrency away
from the web in a wallet or another storage
mechanism to increase security. This is in contrast
with a hot wallet which is connected to the internet
and used for day-to-day transactions.
CONFIRMATION
When a transaction has been verified by miners and
added to the blockchain, it receives a confirmation.
CONSENSUS
Consensus is reached when all network participants
approve the validity of the transactions by ensuring
that ledgers are exact copies of one another.
CRYPTOCURRENCY
This is a type of digital asset used as a medium of
exchange in business transactions.
Cryptography is used to maintain the security of
transactions and control the creation of additional
currency coins or tokens.
DIGITAL ASSET
Not all cryptocurrencies trade as coins or currencies.
If they are digital stores of value, they are termed
digital assets. These can be freely exchanged or not.
FIAT CURRENCY
A fiat currency is any currency that’s issued by a
government or a central bank, such as the dollar.
FORK
This term applies to a blockchain that’s split into two
separate chains, normally to accommodate new
governance rules.
GENESIS BLOCK
This describes the very first block in any blockchain.
GOING LONG/GOING SHORT
These terms describe a margin trade that profits when
the price either increases or decreases.
HALVING
Bitcoins have a finite supply which limits the number
of coins issued to 21 million.
The number of Bitcoins generated decreases by 50
percent every four years, a process that’s known as
halving.
The final halving will occur in 2140. Hash algorithm
This transforms a large amount of data into a fixed-
length hash, or string of characters for a cryptographic
key. Hash algorithms are central to blockchain and
cryptocurrency transactions.
HASH RATE
This refers to the speed at which a piece of hardware
can decrypt hashes.
This is the basis of cryptocurrency mining.
HOT WALLET
A hot wallet is connected to the internet and used to
hold cryptocurrency for everyday transactions.
Because of the increased security risk over a cold
wallet, a hot wallet should not store large amounts of
currency.
Laddering Investors who set incremental buy or sell
orders are said to be laddering.
MINING
Cryptocurrencies aren’t printed like traditional
currencies – they are mined. This process uses
computer hardware to solve complex mathematical
problems and decrypt hashes. Miners are rewarded
for their work with cryptocurrency coins.
MINING RIG
Cryptocurrency mining requires a huge amount of
power. Mining rigs consist of multiple graphic
processors (GPUs) to increase processing power.
MOON
When a cryptocurrency coin goes on a market run and
drives the price up quickly, it’s referred to as mooning.
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MULTI-SIGNATURE, OR MULTISIG
This refers to a situation where multiple signatures
are required to authorize a transaction. This increases
the security of cryptocurrency transactions and
reduces the risk of theft.
NODE
A blockchain isn’t stored in a central location.
In fact, it’s distributed to any number of computers –
called nodes – which host it. Each node is
instrumental in verifying the ledger within the
blockchain.
PRIVATE KEY
This is the key – or password – which unlocks a wallet.
It shouldn’t be shared with anyone.
PUBLIC KEY
A public key is a wallet address that can be shared
with other parties to effect transactions.
PUMP AND DUMP
This is a form of market manipulation by traders who
artificially inflate prices and then exit the market, thus
causing a collapse in the price.
SHARDING
Sharding is a scaling method that enables nodes to
keep partial copies of blockchains.
This can improve network performance and increase
consensus speeds.
SMART CONTRACT
A smart contract contains encoded rules governing
business transactions.
It’s created in a programmable language for storage
on the blockchain and it’s enforced by network
participants.
SPOOFING
Spoofing occurs when investors with large holdings
trade with themselves to create the illusion of
volume.
VOLATILITY
Market or price volatility refers to the movement in
the price of a cryptocurrency over time.
The cryptocurrency market typically experiences wild
swings between high and low prices.
WALLET
In the cryptocurrency sector, a wallet is a digital
address used to store coins or tokens.
It can be used to send and receive these items during
cryptocurrency transactions.
WHALES
Whales are investors who hold a significant number of
coins or other cryptocurrency.
They can have a marked influence on market
movement.
CRYPTOCURRENCY ACRONYMS
ATH: All time high.
The highest price that a cryptocurrency has ever
reached.
DAPPS
Decentralized applications, describing a blockchain-
based application that operates entirely in a
decentralized way.
DCA (Dollar Cost Averaging).
This is an investment technique used to reduce the
impact of market volatility by spreading out buys and
sells over an extended period of time.
FOMO (Fear of Missing Out).
This is commonly experienced in a rising market
where new investors experience the fear of missing
out on gains to be made. The effect of this demand is
to drive the market price higher.
FUD (Fear, Uncertainty, and Doubt).
These emotions are common in volatile markets.
ICO (Initial Coin Offering).
This is similar to an initial public offering (IPO) in the
equities market.
An ICO is used by cryptocurrency startups to raise
capital for their ventures.
A set number of coins is offered for sale to the public
in exchange for fiat or other cryptocurrencies.
Beware: A lot of ICOs are actually scams!
PoW (Proof of Work).
This is used to validate the creation of cryptocurrency
by miners who are required to solve complex
calculations.
This difficulty is instituted so as to make it harder for
cyber attackers to add invalid blocks to the chain.
PoS: (PROOF OF STAKE).
Individuals can gain rewards via a proof of stake in
case they hold more currency in their wallets for a
length of time.
ROI (RETURN ON INVESTMENT).
This is the profit made on an investment or
transaction.
TA (TECHNICAL ANALYSIS).
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This technique is used by market analysts to predict
price action.
CONCLUSION
These are most of the common cryptocurrency terms
and acronyms used in the industry and should help to
give a new investor a better understanding of the
market.
Since this is quite the dynamic and growing industry,
it’s likely that more industry-relevant terminology will
be added in the future!
Pay attention to what’s coming next in the world of
crypto, stay updated on the latest blockchain trends,
and invest like a master who earns that sweet cash
much faster!
NEVER FORGET:
Keep coming back to this glossary of cryptocurrency
terms whenever you need to brush up on
cryptocurrency investment terms!
0X The 0x protocol is an open standard for building
decentralized exchanges on the Ethereum blockchain.
Launched in 2018, 0x enables developers to
incorporate peer-to-peer digital asset exchange into
platforms and apps. 0x’s native token is ZRX, which
allows holders participation rights in 0x platform
governance.
3D MODEL RENDERING
3D model rendering is the process of creating a virtual
image or animation by using varying digital texture,
color, and lighting software. The modeling process
uses data points to represent objects in three
dimensional space, which is then rendered from 3D
models into 2D images through a computationally
heavy process.
401K PLAN
In the US, a 401k is an employer-sponsored,
government-supported pension savings plan for
employees. 401k plans allow companies to sponsor
eligible employees in saving and investing towards
retirement by contributing a portion of their income
to the plan on a tax-deferred basis. These
contributions are often incentivized by employer
matching. 401k plans are typically defined by
contribution limits, tax advantages, and early
withdrawal penalties.
51% ATTACK
A 51% attack is a hypothetical scenario in which more
than 50% of a blockchain network's nodes fall under
the control of a single group. In such a circumstance,
the consensus of a network is no longer sufficiently
distributed enough to be viable, leaving the
blockchain open to manipulation. Attackers with
greater than 50% control of a network would be able
to stop, reverse, and duplicate new transactions, a
catastrophic condition for any blockchain. Notably, a
51% attack becomes more difficult and expensive as a
network grows more sizable, distributed, and
valuable.
AAVE
Aave is a decentralized lending and borrowing
platform on Ethereum. Aave users can take out loans
by providing collateral in the form of crypto assets.
Lenders who provide collateral to Aave receive
aTokens in return, which automatically pay interest to
the holder with funds earned from platform trading
fees. Aave has pioneered the technology of ‘flash
loans,’ which allow for the uncollateralized lending of
funds, so long as the principal is repaid within the
same Ethereum transaction block.
AAVE TOKEN
The AAVE token is an Ethereum-based ERC-20 asset
used as the governance token of the Aave blockchain
protocol. AAVE token holders have the ability to
propose changes and vote to approve or deny new
proposals to the Aave protocol. With significant
enough distribution, AAVE tokens are intended to
eventually accommodate the autonomous and
decentralized governance of the Aave platform.
ACCOUNT ABSTRACTION LAYER (AAL)
The Account Abstraction Layer (AAL) is the technical
infrastructure that makes smart contract development
possible on the Qtum blockchain. The foundational
layer of Qtum follows the UTXO model used on
blockchains such as Bitcoin. The AAL on Qtum allows
the accounts model used on Ethereum to be
“abstracted” or transferred in order to work on top of
the UTXO model. Qtum’s AAL is the computing go-
between that allows the UTXO and accounts models
to interact.
ACCOUNT-CHECKER TOOL
An account-checker is a script or program that takes a
list of usernames and passwords — known as a
combolist — and tests them against a set of target
websites. Account-checker tools substantially increase
the speed and efficiency with which an attacker can
test a large volume of credentials on a broad range of
websites and service providers. These tools are
generally used by malicious actors looking to
capitalize and commit fraud or identity theft against
the account holders from whom they have stolen
access.
ACCOUNT MODEL
The account model is a blockchain architecture that
features direct information and value transfer. Smart
contract platforms such as Ethereum use the account
model as opposed to the UTXO model used by the
Bitcoin network, which limits the capabilities of smart
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contracts. One potential downside of the account
model architecture is difficulty in scaling transactions-
per-second.
ACQUIRER NODE
On the Crypto.com blockchain network, Acquirer
Nodes facilitate the settlement of transactions
between merchant and customer. There are two main
types of Acquirer Nodes: Customer and Merchant
Acquirer Nodes. The two node types communicate to
verify merchant verification, perform settlement for
users, and provide an escrow service that enables
Crypto.com's wallet and debit card products.
ADDRESS
A blockchain address is a unique combination of
numbers and letters that identifies accounts on a
blockchain network. To transact in exchange, digital
assets are sent to and from different addresses. An
example of a Bitcoin address is
‘14qViLJfdGaP4EeHnDyJbEGQysnCpwk3gd’.
ADMIN KEY
An admin key holds special access to make changes to
a project's protocol or smart contract. It is typically
held by a project's founders or core team. Proponents
of decentralization argue that holding admin keys
goes against decenralized governance practices and
poses security risks, while many projects have stated
intention to eliminate them from practice.
Airdrop = Zakkatul Larari
An airdrop is a token distribution method in which
assets are directly transmitted to user wallets for free.
Airdrop recipients do not pay for tokens received.
Typically used as a marketing tactic to create
awareness around a project, airdrops can also result
after a chain fork, token upgrade, or as part of a
fundraising mechanism.
ALGORITHMIC STABLECOIN
Algorithmic stablecoins do not use fiat or
cryptocurrency as collateral. Instead, price stability
results from the use of algorithms and smart contracts
that manage the supply of tokens in circulation. In this
model, the stablecoin’s algorithm automatically
expands or contracts the number of tokens in
circulation in order to meet a specific price target.
ALGORITHMIC TRADING
Algorithmic trading is a modern method of market
trading that utilizes computer software coded to
follow a particularly defined set of mathematical
instructions — an algorithm — to place one or many
trades simultaneously. The formulas compute against
price, timing, quantity and other mathematical
models to follow specific strategies. Algorithmic
trading models execute thousands of trades to
generate profits at a speed, frequency, and
consistency impossible for a human trader.
Algorithmic trading technology gives markets more
liquidity and higher profitability, while also potentially
eliminating the human emotions and error that can
negatively impact trading decisions.
ALLOCATED GOLD AND UNALLOCATED GOLD
According to the London Good Delivery set of
regulatory and compliance standards, gold can be
bought in two distinct forms: allocated or unallocated.
When a customer purchases allocated gold, they have
ownership over the gold and can choose to store it on
their own, or in a vault at a London Bullion Market
Association (LBMA) facility. Unallocated gold does not
feature direct ownership over specific gold bars, but
instead holds entitlement to a certain amount of gold.
ALTCOIN
An altcoin is an “alternative coin,” or any
cryptocurrency launched after Bitcoin. It refers to any
cryptocurrency that is not BTC. For example, ETH, XRP,
and LTC are all altcoins.
AMORTIZING
Amortizing refers to the spreading of an initial or
overhead cost across time or between parties. On the
Orchid network, transaction costs are kept low by
amortizing the fees across transactions and users.
Transaction fees are slowly paid off or broken into
increments that are then shared across a large
network to reduce individual user costs.
AMP (AMP)
AMP is the digital collateral token of the Flexa
network, a payment system that allows users to spend
certain cryptocurrencies with select retailers at their
brick and mortar locations. AMP is an ERC-20 token
used as collateral to guarantee retail payments while
blockchain transactions remain unconfirmed. The
AMP token is the replacement for Flexacoin (FXC).
Gemini Exchange is the first market to support the
AMP token.
ANDRE CRONJE
Andre Cronje is the founder and lead developer of
Yearn Finance. He built most of the original Yearn
products, then relinquished personal control of the
protocol by launching the YFI governance token in
2020. Cronje remains an active figure and builder in
the Yearn community and DeFi ecosystem.
ANNUAL PERCENTAGE RATE (APR)
An annual percentage rate (APR) on a loan is the
amount of interest a borrower must pay each year.
The APR is expressed as an annual percentage of the
outstanding loan balance, and represents the annual
cost of borrowing.
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ANNUAL PERCENTAGE YIELD (APY)
The annual percentage yield (APY) refers to the rate of
return earned on a deposit over one year. APY takes
into account compounding interest, which is
calculated on a periodic basis and added to the
balance.
ANTI-MALWARE
Anti-malware is a category of software designed to
prevent, detect, and remove malware. Malware refers
to any type of 'malicious software' that is specifically
designed to cause damage to computers and
computer systems. Examples of malware include
viruses, trojan horses, and ransomware among others.
ANTI-MONEY LAUNDERING (AML)
Anti-Money Laundering (AML) is a comprehensive set
of processes, regulations, and rules that combat
money laundering, terrorism funding, and financial
crimes like cyber theft and fraud. AML procedures
require financial firms to monitor transactions to
ensure that funds are not part of criminal activities,
circumventing tax laws, or violating any other
regulations. AML is mandatory for users to access
financial services in the blockchain industry.
ANTIVIRUS
Antivirus is a category of software that is designed to
prevent, detect, and remove computer viruses.
Computer viruses are malicious computer programs
that are designed to replicate themselves and cause
damage to computers and computer systems.
APPLICATION BINARY INTERFACE (ABI)
An application binary interface (ABI) is a standardized
method for engaging with smart contracts in a
blockchain ecosystem. ABIs allow smart contracts to
engage with external data, as well as with other
contracts internal to the blockchain platform. ABIs are
similar to application programming interfaces (APIs) in
that they enable separate software systems to
communicate and interact with each other.
APPLICATION PROGRAMMING INTERFACE (API)
An application programming interface (API) is a set of
protocols and codes that determine how different
software platforms communicate and share
information. APIs define different types of requests
and calls that can be made, the data types that can be
used, and how to make these requests. It serves as an
intermediary between different software systems. A
developer can use an API to incorporate features of an
external application into their own software. By
allowing different platforms to communicate, APIs
enhance interoperability across the web.
APPROVED ADDRESSES
For a wallet, exchange, or blockchain-based financial
services platform, approved addresses refers to the
list of addresses permissioned for transactions on an
account. Addresses not included on the list are
prohibited from certain transactions. Approved
addresses are typically implemented for security and
compliance reasons.
ARBITRAGE
To arbitrage is to exploit the price difference of an
asset or security between two markets for profit. For
example, if one bitcoin is selling for $10 on exchange
ABC and $12 on exchange XYZ, then an arbitrageur
can generate a profit of $2 by purchasing one bitcoin
from ABC and selling it at XYZ. Arbitraging can be
automated by utilizing sophisticated computer
systems and software to monitor prices and conduct
high-volume trades that take advantage of even slight
differences in prices. Arbitrage is a necessary financial
mechanism that keeps prices consistent between
different exchanges and wider markets.
ARPANET
Advanced Research Projects Agency Network
(APRANET) is an early version of the internet.
ARPANET was created by the U.S. Department of
Defense and used two technical foundations of the
modern internet: a packet switching network with
distributed control and TCP/IP.
ARTIFICIAL INTELLIGENCE (AI)
Artificial intelligence in a trading context refers to the
use of computer software, machine learning, and
algorithms to set strategy and execute trades. AI
trading systems analyze, process, and calculate vast
amounts of data in order to execute optimal
investment strategies.
ASSET
An asset is anything of monetary value that can be
owned or purchased. Within the context of investing,
assets can refer to a variety of financial and physical
instruments, from stocks to real estate to gold to
dollars. A bitcoin is a particular form of crypto or
digital asset.
ASYMMETRIC ENCRYPTION
Asymmetric encryption is a cryptographic system that
uses a public key for encryption and a private key for
decryption. The public key can be shared with anyone,
while the private key is meant to be kept secret to
maintain security. Asymmetric encryption is
considered more secure than symmetric encryption,
which uses one key for both encryption and
decryption. The Bitcoin network uses asymmetric
encryption.
ASYNCHRONOUS BYZANTINE FAULT TOLERANCE
(ABFT)
Asynchronous Byzantine Fault Tolerance (aBFT) is the
first layer of the Byzantine Fault Tolerance Delegated
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Proof-of-Stake (BFT-DPoS) consensus mechanism.
aBFT uses a two-stage block confirmation mechanism,
wherin a two-thirds supermajority of block producers
confirm each block twice. The first stage proposes a
block (LIB) while the second stage finalizes the
proposed LIB to make the block irreversible.
ATOKENS
An aToken is an ERC-20 token serving that represents
an ownership claim on an underlying asset in the Aave
protocol. When a user deposits assets into Aave
liquidity pools, the platform automaticlaly generates
an aToken in return. For example, providing DAI to
Aave would automatically mint aDAI. Holders of
aTokens continuously earn interest on their deposits,
the value of which is represented in the aToken.
ATOMIC SWAP
An atomic swap is a peer-to-peer exchange of crypto
assets between two parties without the use of a
trusted third party, such as a centralized exchange.
Atomic swaps utilize smart contracts to exchange
crypto assets between different blockchain networks
through a process of locking, verifying, and unlocking.
AUCTION
An auction is a type of market that allows buyers and
sellers to engage with each other through bidding.
Auctions have the benefits of elevated liquidity and
price discovery.
AUTHENTICATION
Authentication is a procedure that verifies the identity
of a user before access is granted. To gain access — to
an account, platform, private space — the user
provides login credentials like passwords, SMS codes,
and fingerprints. Authentication generally comes
before authorization, which is a verification of a user’s
level of access.
AUTHORITY MASTERNODE (AM)
Authority Masternodes (AMs) maintain network
consensus and the security of the VeChainThor
blockchain. AMs are responsible for block propagation
on the platform, and enable VeChainThor's Proof-of-
Authority consensus methodology. In order to host an
AM, the user must hold 25 million VeChain tokens
(VET) and go through a rigorous authentication
process. AMs are the most powerful nodes in
VeChain's nodal hierarchy, and are very limited in
number.
AUTHORIZATION
Authorization is a procedure that verifies a user’s
degree of access. It determines a user’s permission
and access to content or resources. Authorization
generally comes after successful authentication, or
verification of identity.
AUTOMATED CLEARING HOUSE (ACH)
An automated Clearing House (ACH) is an electronic
network that processes financial transactions in the
U.S. An ACH payment pulls funds directly from a user’s
bank account and deposits them into the recipient's
account. A common type of ACH transaction is a direct
deposit payment from an employer.
AUTOMATED MARKET MAKER (AMM)
An automated market maker (AMM) is a fully
automated decentralized exchange where trades are
made against a pool of tokens called a liquidity pool.
An algorithm regulates the values and prices of the
tokens in the liquidity pool. Since AMMs do not rely
on an active market of buyers and sellers, trades can
occur at any time. The most popular AMMs are
Uniswap, Curve, and Balancer.
AVERAGE DIRECTIONAL INDEX
The average directional index (ADX) is a technical
indicator used to quantify the strength of a trend in a
market. The ADX is calculated based on the moving
averages of prices, and is epresented by a number
ranging from 1 to 100, with a higher number
indicating a stronger trend.
BACKDOOR
A backdoor refers to any method that can
circumnavigate regular authentication and
authorization procedures to gain root or high-level
access to a system, computer, application, or network.
Backdoors are commonly installed through remote file
inclusion (RFI), which identifies a weak component in
an application or a network. This type of channel
allows direct control over an infected device to
manipulate data, deploy more malware, or create a
zombie network of infected computers for criminal
activity.
BACKTESTING
Backtesting is the simulation of a trading strategy
based on historical data.Traders use backtesting to
prove that their trading system works based on
historical results. In trading and investing, past
performance does not guarantee future results, which
means a strategy that performs well in backtesting
may not perform as well going forward.
BAITING
Baiting is a form of social engineering that exploits
victims with false promises of financial gain. Malicious
actors, bots, or online ads 'bait' victims with quick
payouts and riches in exchange, while the process to
obtain it involves providing personal information or
downloading software infected with malware.
BAKERS
On the Tezos network, Bakers are nodes with the
responsibility of producing new blocks, and are
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incentivized return to do so with rewards in XTZ.
Bakers are Tezos community members who possess a
minimum amount of XTZ, and enough hardware and
software expertise to run a baking node within the
Tezos Proof-of-Stake network. Through a process of
token staked delegation, bakers may also produce
blocks and earn rewards on behalf of non-Bakers
within the Tezos ecosystem.
BAKING
Akin to the process of staking in many Proof-of-Stake
models, Baking is the process of adding new blocks to
the Tezos blockchain. The baking process involves
adding, signing, and verifying new blocks, and
depositing a specified amount of XTZ as collateral to
guarantee honest behavior.
BALANCE FREEZE FUNCTIONALITY
On the Ripple network, balance freeze is the function
through which Ripple gateways freeze or halt
transactions in order to prevent any abuse of the
system for illicit activity. Balance freeze functionality is
a powerful security feature that can only be applied to
currencies issued on the Ripple network, and not on
the XRP token itself.
BALANCER
Balancer is a non-custodial portfolio manager and
automated market maker (AMM) built on Ethereum
that pools up to eight different tokens for users to
trade. These Balancer pools are self-balancing
weighted portfolios with specific parameters. The
Balancer protocol allows all Ethereum accounts to add
tokens to existing public pools or create their own
private pools.
BAL TOKEN
The BAL token is the governance token for the
Balancer protocol. BAL tokens are earned by liquidity
providers who supply tokens to Balancer pools. BAL
holders can propose and vote on changes to the
protocol.
BANCOR NETWORK TOKEN (BNT)
The Bancor Network Token (BNT) is the default
reserve currency that powers the Bancor protocol.
The Bancor network is a decentralized exchange
platform that uses pools of tokens called liquidity
pools to facilitate peer-to-peer trading. Bancor
liquidity pools must hold BNT, which acts as the
intermediary token for every trade. For example: in
order to trade DAI for ETH on Bancor, the protocol
first exchanges DAI for BNT, then exchanges BNT for
ETH. As liquidity on the Bancor network increases, so
does the value of BNT.
BANDWIDTH
Bandwidth is the amount of data capacity available for
transactional throughput on a network. It is normally
measured by the number of megabytes or gigabytes
per second. If a network's bandwidth limit is reached,
the flow of data will become inadequate to handle the
volume, and connections will slow down.
BANK FOR INTERNATIONAL SETTLEMENTS (BIS)
The Bank for International Settlements (BIS) is an
international financial institution based in Basel,
Switzerland that is owned by numerous global and
central banking stakeholders. Its purpose is to guide
international monetary policy and administer financial
cooperation, alongside serving as a bank for central
banks and other international organizations.
BANKING AS A SERVICE (BAAS)
Banking as a Service (BaaS) is a type of software
platform that provides financial services. BaaS
provides infrastructure for legacy banking systems to
connect and share data with third party financial
service providers to create new products. BaaS can be
thought of as the ‘middleware’ between legacy
financial institutions and fintech startups.
BASE CURRENCY
A base currency is the currency against which an
exchange rate is quoted. It is the first currency
referenced in a currency pair. In the BTC/ USD
currency pair, which references the price of BTC in
terms of USD, the base currency would be BTC and
the quoted currency would be USD.
BASIC ATTENTION TOKEN (BAT)
The Basic Attention Token (BAT) was created to
provide a more effective, fair, and transparent
mechanism for connecting and rewarding internet
users, advertisers, and publishers. In this digital
advertising system, users are rewarded with BATs for
their attention, publishers receive BATs based on user
attention, and advertisers achieve higher ROI and
better targeting. BAT was created by the same team
behind the Brave Browser and is integrated into the
Brave Browser.
BEACON CHAIN
The Beacon Chain is the first stage of the launch of
Ethereum 2.0, an upgrade to the Ethereum network.
The Beacon Chain introduces the Proof-of-Stake
consensus mechanism to the network and allows ETH
holders to stake their ETH and become validators in
Ethereum 2.0. The Beacon Chain was designed to be
the primary mechanism for coordinating data, users,
and assets across the upgraded Ethereum network. It
was launched on December 1, 2020.
BEAR MARKET
A bear market occurs when the market experiences
price declines, typically when prices fall 20% or more
from recent highs. A bear market is the opposite of a
bull market.
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Behavior-Based Detection Methods
Behavior-based detection methods are used by
advanced malware protection programs to identify
suspicious activity. The protection programs analyze
and review code for potentially harmful behavior,
networks attacks, and the installation of rootkits and
malware.
BENCHMARK INDEXES
A benchmark index refers to a preeminent index
security used as measurie against which to track
performance of the wider market. Common
benchmark indexes include the S&P 500, Nasdaq
Composite, and Russell 3000.
BID-ASK SPREAD
A bid-ask spread is the difference between the bid
(buy) and ask (sell) price of a particular asset on an
exchange. The bid price can be though of as
representing demand, while the ask price represents
supply. A large bid-ask spread is a sign of poor liquidity
in a market.
BIP 32
Bitcoin Improvement Proposal 32 (BIP 32) established
the standard for hierarchical-deterministic (HD)
wallets, a technical improvement over earlier wallets
that on random key pairs. BIP 32 allowed for the
creation of a hierarchical tree-like wallet structure
with more advanced cryptographic security
mechanisms. HD wallets are defined by a master key
pair at the top of the hierarchy that “determines” all
the private key and key pair access codes below it in
the access hierarchy.
BIP 38 Password
A Bitcoin Improvement Proposal 38 (BIP 38) password
enables walletholders to encrypt Bitcoin private keys
to offer an extra layer of protection. An encrypted
private key requires that a user hold both the private
key and the password in order to access wallet funds.
This makes private key management a critically
important step, which is commonly done on paper
wallets and other analog devices for security
purposes.
BIP 39
Bitcoin Improvement Proposal 39 (BIP 39) allows for
the generation of a human-readable 12-24 word
recovery phrase for hierarchical-deterministic (HD)
wallets. With the recovery phrase, users can
regenerate an HD wallet that has become lost or
damaged. Because they hold such access, BIP39-
enabled recovery phrases should be kept secret and
stored securely.
BIP 44
Bitcoin Improvement Proposal 44 (BIP 44) improves
on BIP 32’s HD wallet structure by creating a specific
hierarchy that allows for multiple accounts to be held
on the same wallet. BIP 44 allowed two or more
separate accounts on the same wallet to hold the
same cryptocurrencies in different amounts. The
separate accounts could be used for different
purposes and coexist in a way similar to checking,
business, and savings accounts at legacy banks.
BITCOIN
Bitcoin is a blockchain network with a native
cryptocurrency (bitcoin). It is the first blockchain and
cryptocurrency, hence its dominant presence within
the broader crypto ecosystem. Bitcoin was established
in 2009 and pioneered Proof of Work, a technology
for reaching consensus on a decentralized network.
BITCOIN (BTC)
Bitcoin (BTC) is a cryptocurrency that can be directly
transmitted between users on the Bitcoin network. It
is spelled with a lowercase B, as compared to the
Bitcoin network, which is denoted with an upper case
B.
BITCOIN CASH (BCH)
Bitcoin Cash is a hard fork of the Bitcoin Network that
serves as an electronic cash payment system. Its
cryptocurrency, BCH, was designed to be a more
practical cryptocurrency for everyday transactions
than BTC. Bitcoin Cash's increased block size
encourages use as a payment system rather than as a
store of value.
BITCOINER
A Bitcoiner is holder of bitcoin and an active
proponent of the Bitcoin network. Bitcoiners typically
believe that bitcoin is the most important and
significant digital asset available.
BITCOIN GENESIS BLOCK
The Bitcoin genesis block was the first block mined on
the Bitcoin blockchain. It was mined on January 3,
2009.
BITCOIN IMPROVEMENT PROPOSAL (BIP)
A Bitcoin Improvement Proposal (BIP) is a code
change introduced to improve the Bitcoin protocol. A
BIP can be submitted by anyone to be evaluated and
reviewed. Significant BIPs include BIP 32, BIP 39, and
BIP 44.
BITCOIN NETWORK
The Bitcoin network is a peer-to-peer, decentralized
network that allows users to send units of value to
each other without any intermediary or bank. The
term “Bitcoin” with a capital B denotes the network,
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while the term "bitcoin" with a lower case B denotes
the network's native cryptocurrency.
BITCOINTALK
Bitcointalk is an internet message forum that was
launched by pseudonymous Bitcoin creator Satoshi
Nakamoto in 2009 to host discussions about Bitcoin,
blockchain, and cryptocurrency. It became the
meetingpoint for the embryonic blockchain industry,
and was the site of the first bitcoin purchase: 10,000
BTC in exchange for two pizzas. Bitcointalk is still in
operation today, fostering discussion and community
between 450,000+ developers, investors, miners,
programmers, and enthusiasts.
BITLICENSE
The BitLicense is a business license for virtual currency
activity that crypto enterprises must obtain before
operating in the state of New York. BitLicenses are
issued by the New York Department of Financial
Services (NYDFS), and primarily regulate the
commercial receipt, storage, and transfer of digital
assets. Only 25 have been granted as of 2020, while
recipients include Circle, Coinbase, Robinhood, and
Square. Businesses chartered under New York banking
law such as Gemini are not required to hold
BitLicenses.
BLOCK
On a blockchain, a block is the data record of all
transaction information made during a specific
timeframe on its network. Blocks are added
sequentially to a network's chain of data, which in
turn make up the public ledger known as blockchain.
For example: A Bitcoin block contains information
about the date, time, and amount of transactions, as
well as signature information regarding the origin and
destination of the transfer. Blocks must be confirmed
by the network via a process of consensus before a
chain can continue transacting and creating new
blocks.
BLOCKCHAIN
A blockchain is a public ledger of transactions that is
maintained and verified by a decentralized, peer-to-
peer network of computers that adhere to a
consensus mechanism to confirm data. Each
computer in a blockchain network maintains its own
copy of the shared record, making it nearly impossible
for a single computer to alter any past transactions or
for malicious actors to overwhelm the network.
Sufficiently decentralized blockchains do not rely on
centralized authorities or intermediaries to transact
globally, securely, verifiably, and quickly, making
technology like cryptocurrency possible.
BLOCKCHAIN TRANSMISSION PROTOCOL (BTP)
The Blockchain Transmission Protocol (BTP) is ICON
network’s proprietary interoperability framework. It
allows independent blockchain networks to connect
and exchange data. BTP facilitates the transfer of
information and tokenized assets between ICON and
external blockchain systems.
BLOCKCHAIN TRILEMMA
The blockchain trilemma refers to the challenge in
achieving a balance between scalability,
decentralization, and security in a blockchain network.
While scalability refers to the speed and volume of
transactions, decentralization refers to the
distribution of network nodes, and security refers to
the integrity of the system from compromise. The
blockchain trilemma states that an equal prioritization
of all three factors at once is impossible — so a trade-
off must be made with one. It remains an ambition of
blockchain technologists and entrepreneurs to solve
for the trilemma with greater effectiveness in the
design of any network, update, or application.
BLOCK DIFFICULTY
Block difficulty refers to the complexity of
computation required to mine new blocks in a Proof-
of-Work (PoW) blockchain environment. Block
difficulty is a configurable aspect of a blockchain
protocol, and can be used as a mechanism to stabilize
block production times in accomodating challenges
like transaction speeds and network capacity.
BLOCK EXPLORER
A block explorer is a software interface that enables
users to access realtime blockchain information like
transactions, blocks, addresses, nodes, and balances
on a particuar network. Operating as web browsers
for blockchains, the many free-to-use and open
source block explorers are essential in providing for
global transparency and democratized access to
blockchain network.
BLOCK PRODUCERS
On most Proof-of-Stake blockchains, block producers
are the individuals or group whose hardware is chosen
to validate a block's transactions and initiate the next
block. The term originated within blockchain
ecosystems that utilize Delegated Proof of Stake
(DPoS), where users elect block producers to validate
and add blocks. Other names for block producers are
'delegates' or 'witnesses.'
BLOCK REWARD
A block reward is the payment awarded to a
blockchain network miner upon successfully validating
a new block. Typically paid out in the native asset of
its network at a fixed, but regressive rate, block
rewards are often the only source of new currency
creation on a network. They provide a key element of
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the incentive structure that keeps blockchain
networks operating in a decentralized fashion. In
Proof-of-Work blockchains like Bitcoin, block
validation and block rewards are the remit of miners.
In newer models like Ethereum’s upcoming Proof of
Stake, the block reward is paid to the collateral staking
validator nodes.
BLOCK SIZE
Blockchain network protocols are made up of blocks
of data that are processed in a perpetually updating
chain-like structure — hence the term "blockchain."
Each block stores transactions sent on the network of
a specific size or specific time-period as set by the
governance of the particular blockchain.
BLOCK TRADE
A block trade is a large purchase or sale of securities
executed outside of an open marketplace. Because
the size of the transactions are quite large, block
trading is typically done by institutions and hedge
funds. The private nature of block trading makes them
similar to over-the-counter (OTC) trading.
BNB
BNB is the native cryptocurrency of the Binance
ecosystem and a Top 10 cryptocurrency by market
capitalization. On the Binance exchange, users can pay
for exchange fees like transactions, withdrawals, and
listings in BNB and receive a discounted rate. BNB can
also be used to participate in token sales on Binance
Launchpad, its platform for hosting third-party Initial
Exchange Offerings (IEOs). In September 2020,
Binance launched the Binance blockchain, upon which
BNB can be staked to verify transactions and recieve
block rewards.
BOLLINGER BANDS
Bollinger Bands are a technical analysis device created
by trader John Bollinger in 1983 that have become
one of the most popular tools used by traders today.
Bollinger Bands use moving averages and standard
deviation to create a range of price movements. On a
trading chart, Bollinger Bands are visually represented
by a centerline based on a moving average, with a
band below and above the centerline based on
standard deviation. Bollinger Bands can help indicate
if prices have moved outside of the range of historical
deviation, and can be used to identify a number of
market scenarios in real time.
BOTNET
A botnet is a collection of internet-connected devices
that have been infected by malware, enabling
malicious actors to control the devices. Infected
devices are oftentimes controlled remotely and
without the legitimate device owner's knowledge.
Botnets are often composed of a variety of device
types and used by cybercriminals to carry out a broad
range of orchestrated online attacks such as
credentials leaks, data theft, and DDoS attacks.
BRAIN WALLET
A brain wallet refers to a crypto private key or seed
phrase that has been memorized by its owner.
Although memorized accounts are immune to online
hacks and physical theft, they are susceptible to being
forgotten, or lost upon the holder’s death. Brain
wallets are not recommended as a secure crypto
wallet option.
BRAVE BROWSER
The Brave browser is an open-source, privacy-focused
web browser developed by the same team that
created the Basic Attention Token (BAT). It is the first
web browser to implement the BAT system. The Brave
browser, in combination with BAT, rewards users for
viewing advertisements in a transparent relationship
between advertiser, publisher, and user.
BRD
BRD is a cryptocurrency wallet and financial services
platform that aims to accelerate mainstream adoption
of cryptocurrencies by simplifying the processes of
purchase, conversion, and storage. On BRD's mobile
app, users can purchase leading cryptocurrencies,
along with BRD tokens (BRD), a native asset that
receives rewards and discounts that improve
according to a user's BRD holdings.
BREAD REWARDS
The Bread Rewards program provides incentives to
Bread platform users for engaging in network-
beneficial activity like maintaining a wallet balance
above a certain threshold, or posting on social media.
Bread Rewards was one of the first customer loyalty
programs in the cryptocurrency wallet space.
BREAKDOWNS
A breakdown is a trading pattern that follows a
downward move in an asset’s price, often through an
identifiable level of support and further below.
Breakdowns are characterized by heavy volume, a
rapid decline, and severe magnitude. Breakdowns can
be identified by technical indicators like charting
patterns, trendlines, and moving averages.
BRIDGES
Bridges allow independent blockchains to
communicate with each other. On the Polkadot
network, bridges are used to attach parachains and
the main Relay Chain to other external blockchain
networks such as Bitcoin and Ethereum. Polkadot data
transmits from its main Relay Chain to parachains,
attached to which collator nodes assemble all the
transactions. Collator nodes communicate via a bridge
to connect to external blockchain networks.
Brokerage Account
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A brokerage account is a financial service created and
managed by a licensed brokerage firm on behalf of an
investor to interact with assets and markets. Account
holders can either make trades themselves, or the
firm can make them on behalf of account holders. In
all cases, the assets purchased through the brokerage
account belong to the account holder.
BRUTE FORCE ATTACK
In a brute force attack, an attacker attempts to gain
access to an account by systematically trying all
possible combinations of passwords and passphrases
that may apply to the account, with the goal of
eventually guessing the correct credentials. While
brute force attacks can be computationally intensive,
time-consuming, and difficult to pull off, they can
correctly guess a weak password within a few
seconds. A strong password can deter most brute
force attacks.
BUBBLE
A bubble occurs when an asset rises to extremely
inflated prices and then comes crashing down, settling
at a level that’s far less than its original price —
typically a drop of 75% or more. It is usually possible
to identify a bubble only after it has burst and the
price recedes. A speculative bubble is characterized by
both the rise and fall occurring within a very short
period.
BULLISH
The term "bullish" can be used to describe how
positive or optimistic a person feels about a particular
asset. Someone who is bullish on bitcoin believes the
price of bitcoin will increase. A person who is bullish
on bitcoin may also be referred to as a bitcoin "bull."
BULL MARKET
A bull market refers to an upward trend in prices for
an extended period of time. As of 2020, bitcoin has
undergone three bull markets. The opposite of a bull
market is a bear market.
Business Logic Layer (BLL)
Within a programming context, the business logic
layer (BLL) determines how data a software program
interacts with can be created, altered, and stored. The
business logic layer coordinates data between the
program’s user interface (UI) and data access layer
(DAL), although in some programs the UI interacts
directly with the DAL.
BUY SIDE/SELL SIDE
Buy side and sell side refers to the buyers and sellers
in a market who are connected by an order
management system (OMS). The buy side is typically
fund managers whose job is to pick high-alpha
securities for their portfolios. The sell side is typically
trading floors at investment banks. Rapid and
concurrent trades between the buy side and sell side
are facilitated by advanced OMS technology
protocols.
BYZANTINE FAULT TOLERANCE (BFT)
Byzantine Fault Tolerance refers to a blockchain
network's ability to reach consensus and continue
operating even if some of the nodes in the network
fail to respond or respond with incorrect information.
A network that is Byzantine Fault Tolerant solves the
Byzantine Generals Problem, a situation in which all
parties must agree but one or more parties are
unreliable. Most actively used consensus mechanisms
are Byzantine Fault Tolerant.
BYZANTINE FAULT TOLERANCE DELEGATED PROOF
OF STAKE (BFT-DPOS)
Byzantine Fault Tolerance Delegated Proof of Stake
(BFT-DPoS) is the primary consensus mechanism that
runs the EOS and ICON blockchain ecosystems. BFT-
DPoS is a highly-performant consensus mechanism
that makes use of data passing between parties
without an intermediary. It is composed of the two
main layers that work together: Asynchronous
Byzantine Fault Tolerance (aBFT) to propagate and
validate block production, and Delegated Proof of
Stake (DPoS) for block producer voting and
scheduling.
C++
C++ is a widely used, general-purpose programming
language. An extension of the C programming
language, C++ is commonly used as a compiled
language (as opposed to an interpreted language) and
can be used on many different platforms.
CALL OPTION
A call option contract gives an investor the right, but
not the obligation, to purchase an underlying security
at a specified price within a defined period of time.
When the option expires, the investor can choose to
buy the underlying security or let the options contract
become void. Call options are traded on exchanges as
a derivative, and can be used for speculation, income,
or trading strategies like hedging.
CALL PROVISION
A call provision on a bond or other fixed-income
investment product is an option allowing the issuer to
repurchase and retire the bond. The call may be
triggered by a set price, or may be limited by a specific
time period. A bond with a call provision pays a higher
interest rate than a noncallable bond.
CARDANO (ADA)
Cardano is a Proof-of-Stake blockchain platform with
smart contract functionality. In particular, Cardano is
noted for its focus on academic reserach, high
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transactions-per-second (TPS) throughput, and an
energy-efficient consensus mechanism called
Ouroboros. ADA, the native token of the Cardano
network, is used to facilitate transactions and smart
contract execution.
CASASCIUS COINS
Casascius Coins were physical bitcoin products sold
until 2013. Made of metal, Casascius Coins had a
tamper-resistant sticker concealing the private key
and could be physically exchanged. The coins came
preloaded with fixed amounts of 1, 10, 25, 100, and
1000 bitcoins. Unredeemed versions of Casascius
Coins are highly valued on the collector’s market and
sell for a large
premium.
CASHFUSION
CashFusion is a privacy tool for concealing Bitcoin
Cash transactions. It is an improvement on the
CashShuffle tool with enhanced privacy
characteristics. Improvements include a higher max
amount that can be shuffled, the ability to “shuffle” or
“fuse” different amounts than other participants, and
more UTXO combinations, thus making transactions
much more difficult to trace. Tor is also built into the
CashFusion protocol to mask user IP addresses.
CASHSHUFFLE
CashShuffle is a privacy tool for concealing Bitcoin
Cash transactions. The process involves many users
combining their funds into one large transaction,
which is then sent back to the users in a way that
hides their transaction paths. CashShuffle is a version
of CoinJoin that works on the Bitcoin Cash protocol.
CASPIAN (CSP)
Caspian (CSP) is a cryptocurrency trading platform
designed for institutional traders. The platform
provides users with an order and execution
management system (OEMS), position management
system (PMS), risk management system (RMS), and
tools for compliance and reporting requirements. CSP
is an ERC-20 token that can be staked to earn
discounts on the Caspian platform.
CBOE OPTIONS EXCHANGE
The Cboe Options Exchange is the world’s largest
exchange for futures and options trading. Established
in 1973, Cboe offers derivative options related to
several products, including equities, indexes, and
funds. Exchange-traded funds (ETFs) and exchange-
traded Notes (ETNs) are also traded on the Cboe
Options Exchange. Along with the Chicago Mercantile
Exchange (CME), the Cboe Options Exchange launched
Bitcoin futures trading in 2017.
Celo
Celo is a mobile-first blockchain payments platform
that makes cryptocurrency and financial services
accessible to anyone with a smartphone. Celo intends
to build decentralized finance instruments that do not
require the technical knowledge of many of today’s
leading applications. Launched by Silicon Valley
startup cLabs, Celo is a fork of the Ethereum
blockchain that is specialized to create and distribute
a suite of stablecoins backed by fiat currencies,
particular localities, and even natural resources. Celo
is governed by the holders of its native asset, CELO.
CENSORSHIP RESISTANCE
Censorship resistance refers to a blockchain network’s
ability to remain tamper-proof. A sufficiently
decentralized blockchain network transparently
distributes data across a wide range of computers,
which makes censorship extremely difficult. The
transparent and decentralized nature of blockchains
makes them highly resistant to external modifications.
CENTRAL BANK
A central bank controls the monetary policy and
currency of a nation-state. Central banks function as
the bank of government, and have the power to set
interest rates and the money supply. The Federal
Reserve is the central bank of the United States.
Central Bank Digital Currency (CBDC)
A central bank digital currency (CBDC) is a digital
version of a country's fiat currency. It is centralized
and regulated by a country's monetary authority.
CENTRALIZATION
Centralization refers to the consolidation of control,
authority, and access by a person or group. In a
blockchain context, centralization refers to the level of
privilege and distribution of nodes verifying and
managing the network. Blockchains relying on
powerful ‘super nodes’ or nodes concentrated in a
limited geographical area are considered more
centralized.
CENTRALIZED EXCHANGE (CEX)
A centralized exchange (CEX) is a centrally controlled
platform used to trade crypto assets. Centralized
exchanges act as intermediaries between buyers and
sellers. These platforms are custodians of user data
and funds.
CENTRAL PROCESSING UNIT (CPU)
A Central Processing Unit (CPU), or main processor, is
the most powerful component of the electronic
circuitry inside a computerized system. The Central
Processing Unit (CPU) processes essential logic,
arithmetic, and input and output operations specified
by the instructions of the operating system of a
computer. In the case of EOS and EOSIO, the CPU is
part of the eos.system alongside 4 other core
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components in the system: NET, RAM, Vote, and
Stake.
CERBER RANSOMWARE
Cerber ransomware is a type of malware that locks
and encrypts a victim’s files until a ransom is paid.
Cerber ransomware became notorious for its
ransomware-as-a-service model, which enables
malware creators to sell their services to other
cybercriminals in return for a cut of the profit earned
via the attacks.
CERTIFICATES OF DEPOSIT (CDs)
A Certificates of Deposit (CD) is a type of savings
account that holds a fixed amount of money for a
fixed period of time in exchange for interest paid by
the issuing bank. Common time periods for a CD are
six months, one year, or five years.
CHAINLINK (LINK)
Chainlink is a decentralized oracle network that
provides real-world data to smart contracts on the
blockchain. LINK is the digital asset token used to pay
for services on the network.
CHANGE ADDRESS
A crypto transaction has an input address, output
address, and change output, which represents the
information transacted. The change output is the
difference between the input or output, or the
“change” leftover. The change address is where the
change output is sent.
CHICAGO MERCANTILE EXCHANGE (CME)
The Chicago Mercantile Exchange (CME) is a
marketplace for derivative financial contracts. The
Chicago-based exchange was founded in 1898 and is
now one of the biggest global derivatives markets in
the world. In 2017, the CME launched the trade of
bitcoin futures contracts.
CHILDCHAIN
A childchain is a scalable blockchain on the OMG
Network which is anchored to Ethereum. OMG’s
scaling solution optimizes the speed of the Ethereum
network by moving transactions off of the Ethereum
main chain and onto childchains. The childchain does
not hold users’ funds and it relies on the Ethereum
blockchain and a decentralized network of watchers
for its security. Childchains are different from
sidechains in that sidechains have their own security
mechanisms and custody users’ funds.
CIPHERTEXT
Ciphertext refers to encrypted text that is unreadable
without authorized access. Plaintext is transformed
into ciphertext via an encryption algorithm. Only
those who are authorized to access the data should be
able to decrypt the ciphertext back into readable
plaintext.
CIRCULATING SUPPLY
The circulating supply is the total number of tokens of
a specific cryptocurrency that are available in the
market. The circulating supply includes all tokens
locked in decentralized applications and held on
crypto exchanges or in user wallets. The circulation
supply is different from the total supply, which is the
total amount of tokens that will ever be created.
CLEARING
As it relates to the banking and finance industry,
clearing is the process of settling a financial trade or
purchase of an asset by correctly and efficiently
transferring funds to the seller, and in return, by
transferring the corresponding asset to the buyer.
Typically, a specialized organization acts as an
intermediary in the clearing process to both buyer and
seller to ensure procedure and finalization. The
interrelated processes of clearing and settlement are
what make up the post-trade process.
CLEOS COMMAND LINE INTERFACE (CLI)
The Cleos Command Line Interface (CLI) utilizes lines
of text to process commands on the EOSIO blockchain
platform. Cleos simplifies the development process
for software engineers by giving them access to
specific developer tools to interact with EOS
blockchains. The CLI is used for reading data from the
blockchain, sending new transactions, and to test and
deploy smart contracts. Cleos interacts with Keosd,
Nodeos and other components of the EOSIO
ecosystem.
CLOSED LOOP PAYMENT NETWORK
Closed loop payment networks are those in which a
consumer loads money into an account that can only
be used with specific merchants, whereas open loop
payment networks allow consumers to use money
stored in a centralized wallet for multiple merchants.
Closed loop networks cut out several middlemen in a
payments transaction, reducing transactions fees and
speeding up settlement. Flexa utilizes a closed loop
payment network architecture.
COINJOIN
CoinJoin was originally developed as a privacy tool for
concealing a user’s Bitcoin transactions. "CoinJoining"
involves many users combining their funds into one
large transaction, which is then sent back to them in a
way that hides their transaction paths. CoinJoin is a
non-custodial solution, which means users never lose
control of their funds during the CoinJoining process.
Different versions and variations of CoinJoin can now
be found on multiple protocols outside of Bitcoin.
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COIN MIXER
A coin mixer is a software or service that mixes the
cryptocurrencies of many different users to preserve
privacy and anonymity despite the public ledger of
blockchain networks. Coin mixing increases the
challenge of tracking transactions, and has been found
evident in dark web activities and money laundering
in addition to its legal uses.
COIN SWAP (OR TOKEN SWAP)
A coin swap or token swap is the process of a platform
replacing an existing token with a significantly
updated token. The new token is designed to give the
protocol significant increased utility needed to further
expand the project and distributed to wallet holders,
while the pre-existing token is voided.
COLD STORAGE
Cold storage refers to the offline storage of a
cryptocurrency wallet. "Offline" means that the wallet
is disconnected from the internet, preventing hackers
from accessing it. Cold storage is considered to be the
most secure way to hold crypto assets.
COLD WALLET
A cold wallet is a cryptocurrency wallet that is not
connected to the internet. Cold wallets most often
come in the form of hardware wallets, which are
physical devices that store private keys. Cold wallets
stand in contrast to hot wallets, which are connected
to the internet.
COLLATERAL
Collateral refers to an asset that is offered as security
for repayment of a loan, to be forfeited in the event of
a default (a situation in which an individual is unable
to pay back a loan). When borrowing money on a DeFi
lending platform, collateral in the form of a token
must be locked. The collateral is returned upon
repayment of the loan. If the loan is not repaid, the
collateral remains locked on the platform.
COLLATERAL FACTOR
The collateral factor is the amount of collateral
required for a given amount of debt. It represents the
maximum amount a user can borrow based on
collateral provided. The collateral factor, sometimes
referred to as the collateral ratio, is commonly used
on DeFi lending platforms such as Compound,
MakerDAO, and Aave, which rely on over-
collateralized loans. When the value of a user’s
collateral falls below the collateral factor, the user
risks their collateral being liquidated or sold off to
repay a portion of the loan.
COLLATERALIZATION
Collateralization is the use of one asset to back the
value of another asset. With crypto, the process
requires the storing and locking of the collateralized
assets within a blockchain protocol.
Collateralized Debt Position (CDP)
On the Maker platform, a collateralized debt position
(CDP) is created when a borrower provides
cryptocurrency as collateral in order to mint or
borrow the DAI stablecoin. The value of the collateral
in a CDP must always remain above a certain
minimum requirement or else risk liquidation. In the
event of liquidation, the collateral in the CDP is sold in
order to repay a portion of the DAI debt. The
collateral in the CDP can be returned when the DAI is
repaid by the borrower.
COLLATERALIZED MORTGAGE OBLIGATIONS (CMOS)
Collateralized mortgage obligations (CMOs) are
complex debt instruments that consist of many
mortgages bundled together and are sold as a single
investment. CMOs are organized according to their
risk profiles. They are similar to collateralized debt
obligations (CDOs) and are believed to be a
contributing factor in the 2007-2009 global financial
crisis.
COLLATORS
Collators are full nodes on the Polkadot Network that
are present both on parachains and the main Relay
Chain. Their main purpose is to maintain parachains
(which are sovereign blockchains or specialized
shards) by collecting parachain transactions and
producing state transition proofs (essentially machine-
driven progress reports) for validators on the Relay
Chain. Collators can access all state transition
information necessary for authoring new blocks and
executing transactions — much like how miners
provide value in a Proof-of-Work system. Collators are
also used to send and receive messages from other
parachains, facilitating communication through Cross-
Chain Message Passing (XCMP).
COMBOLIST
A combolist is a text file which lists out usernames and
passwords in a machine-readable format. The file is
used as an input for an account-checker tool that can
automate authentication requests to a website, online
service provider, or API. Combolists are often created
following an online data breach and packaged and
sold by hackers to other malicious actors.
COMMAND LINE INTERFACE (CLI)
A Command Line Interface (CLI) is a system that
utilizes lines of text to process commands for a
specialized computer program. The interface used to
execute command line instructions is called a
command-line-processor or command-line-
interpreter. Most applications utilize menu-driven or
graphical user interfaces but some still use a
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command line — especially for software development
and other technical processes.
COMMODITIES
Commodities are raw materials that are fungible or
interchangeable for like-goods. Commodities range
from agricultural goods like wheat and sugar to hard
metals like gold, copper, and silicon. Gold is
considered a highly fungible commodity because it
can be easily exchanged regardless of the source or
producer.
COMMODITY-BACKED STABLECOIN
Commodity-backed stablecoins are pegged to the
value of underlying commodity assets like gold, silver,
or real estate. Holders of these stablecoins have a
claim to their underlying assets. The most popular
commodity-backed stablecoins are backed by gold.
For example, each PAX Gold (PAXG) token is pegged
on a 1:1 ratio to one troy ounce (t oz) of a 400-ounce
London Good Delivery gold bar.
COMMUNITY NODE
Within the Crypto.com blockchain ecosystem,
Community Nodes responsible for sending, verifying,
and receiving transactions, as well as reading data on
the protocol. Community Nodes can accessed for use
by any member of the Crypto.com community.
COMMUNITY REPRESENTATIVES (C-REPS)
On the ICON Network, Community Representatives (C-
Reps) represent one of the two main types of Peer
nodes (the other being P-Reps) that are responsible
for maintaining network security and consensus. C-
Reps represent the community interests of enterprise
and governmental constituents like hospitals,
government entities, financial markets, and corporate
entities.
COMPLIANCE
Compliance is the process of ensuring financial
enterprises meet certain regulatory guidelines
introduced by government bodies, such as the
Securities and Exchange Commission (SEC) in the U.S.
These guidelines seek to protect investors, ensure
consumer confidence, facilitate the transparency,
efficiency, and fairness of markets while reduce
financial crime and system risk.
COMPOSABILITY
Composability is a design feature that accomodates
for infrastructural elements of a system to be easily
integrated with and utilized by other systems and
third parties. Composable systems are often
compared to “Lego blocks” because they are built of
various parts that can be fit together to create new
platforms.
COMPOUND
Compound is a decentralized lending and borrowing
platform for digital assets on Ethereum. Borrowers on
Compound are required to provide a minimum
amount of collateral to access a loan, while interest
rates are determined by crowdsourced token supply.
Tokens locked in the Compound protocol
automatically earn interest as they are lent out to
borrowers.
COMP TOKEN
COMP is the governance token of the Compound
protocol, a decentralized, blockchain-based protocol
that allows you to lend and borrow crypto. A
predetermined amount of COMP is distributed to all
lenders and borrowers on the Compound protocol
every day. Anyone who owns at least 1% of the total
COMP supply can submit and vote on proposals to
change the protocol.
COMPUTATIONAL BACKLOG
Computational backlog (or debt) is defined as a set of
calculations that must be completed to bring a
backlog on the EOSIO blockchain up to date.
Computational backlog occurs when a computer
system or a blockchain network accumulates too
much computational debt. This is a highly undesirable
situation for a blockchain, because it can result in
deteriorating system performance, including
significant transaction time delays. Computational
backlog must be managed efficiently to maintain the
long-term health of the network. To help prevent
computational backlog from happening, EOSIO block
producers publish the network's available capacity for
computation, state, and bandwidth.
CONCEALMENT
Concealment is a category of malware that attacks
computer systems by evading detection. Common
types of concealment malware include Trojans,
backdoors, and rootkits.
CONSENSUS MECHANISM
A consensus mechanism is an algorithm that
participants in a blockchain network use to reach an
agreement on the state of the blockchain ledger,
including the order of transactions. Popular consensus
algorithms include Proof-of-Work (PoW), Proof-of-
Stake (PoS), and Delegated Proof-of-Stake (DPoS).
CONSORTIUM BLOCKCHAIN
A consortium blockchain is a private network
managed by multiple entities, wherein each retains
special privileges. Controlling entities typically
participate in the consensus process as a transaction
validator and have permissions to view certain types
of data. Consortium blockchains are a less
decentralized digital ledger technology that maintains
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some benefits of distributed systems for use cases like
enterprise and government.
CONSTANT PRODUCT FORMULA
A constant product formula is an algorithm used to
determine the price of tokens on an automated
market maker (AMM) platform. The formula
maintains that tokens in a liquidity pool must remain
at a fixed relative value. The most well-known formula
is x * y = k, pioneered by the Uniswap protocol, which
maintains that a pair of tokens in a liquidity pool must
remain at equal total values. By fixing the relative
value of the tokens, the formula is able to
automatically determine pricing.
CONTINUOUS ORDER BOOK
A continuous order book is a listing of parties
interested in buying or selling an asset on a market.
The list specifies the quantities and prices each buyer
or seller is willing to accept for an exchange. A
matching engine is concurrently used to pair the
buyers and sellers, while the order book is updated in
real time.
CONTRACT SEPARATION
Contract separation is a key design logic that
underpins the Gemini dollar (GUSD) smart contract.
Instead of a single unifying smart contract, Gemini
dollar contracts are separated into multiple layers,
each with a specific function. Contact separation
increases the security and robustness of smart
contracts within GUSD’s protocol.
COORDINATOR
A coordinator is a centralized master node on the
IOTA DAG network that curates and approves all
transactions. Because IOTA relies on centralized
master nodes, the network is not considered to be
fully decentralized. IOTA’s roadmap has a plan called
“Coordicide”, which attempts to minimize the role of
the coordinator while still providing a secure network.
CORPORATE BOND
A corporate bond is a debt security a company issues
in order to raise capital that can be traded on the
secondary market. Purchasers of corporate bonds
effectively lend money to the issuing company in
return for a series of interest payments. Rating
agencies like Moody's, Standard & Poor's, and Fitch
evaluate the creditworthiness of corporate bonds.
COSMOS (ATOM)
Cosmos is a platform designed to connect
independent blockchain networks. The platform
facilitates data transfer between different blockchains
to facilitate what is referred to as the ‘internet of
blockchains’. ATOM is the native token of the Cosmos
network, and it is used for transaction payments,
governance voting, and staking to secure the network.
COSMOS HUB
The Cosmos Hub is the primary blockchain protocol
used for connecting with other blockchains as part of
the Cosmos Network's endeavor to facilitate an
'internet of blockchains'. The Cosmos Hub is a Proof-
of-Stake blockchain built by the Tendermint team. Its
ATOM token is used to both secure the network
through staking and vote on governance decisions.
COSMOS SDK
The Cosmos SDK is a framework that allows
developers to build Proof-of-Stake and Proof-of-
Authority blockchains. The framework is designed to
construct application-specific blockchains rather than
more generalized virtual machine-based blockchains.
The Cosmos SDK is a scalable, open-source
infrastructure, and is used to build blockchain
platforms such as the Cosmos Hub.
COST BASIS
The cost basis is the reported starting value of a
particular asset such as a cryptocurrency that you
own. The cost basis can be the price of the asset on
either the date of purchase, or the date the asset was
received. When the asset is sold, the cost basis is
subtracted from the sale price to determine the
monetary gain or loss.
Council Node
Council Nodes are the most powerful and important
nodes within the Crypto.com blockchain system. They
are responsible for maintaining network consensus
and governance of the platform. Council nodes are
used for settlement execution, ordering transactions
and CRO rewards tracking, along with verifying,
receiving, and sending all network transactions.
Council Nodes also maintain a whitelist log for Council
Node, Acquirer Node, and Community Node
Identities.
Counterparty Risk
Counterparty risks refers to the possibility that a party
involved in a transaction will fail to meet their
obligations. Various measures can be put in place to
mitigate counterparty risk. One such measure is a
smart contract, which is only automatically executed
once certain conditions have been met.
Coupon Payment
In a corporate bond, a coupon (or coupon payment) is
the dollar amount of interest paid to an investor. It is
calculated by multiplying the interest rate of the bond
by its face value.
Credit Rating
A credit rating is an analysis of the credit risks
associated with a financial entity. A credit rating may
be assigned to any entity that seeks to borrow money
— a corporation, individual, state authority, or
sovereign government. Credit ratings assess the ability
of a borrower to repay a loan — either in general, or
for a particular debt or financial obligation.
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CREDIT RISK
Credit risk refers to the loss potential of a borrower
failing to repay a loan. In a fixed-income investment
agreement, interest payments are meant as an
incentive for an investor to assume credit risk. Higher
interest rates tend to compensate for greater credit
risk.
CRO
CRO is the foundational utility token that drives
Crypto.com’s ecosystem of payment, trading, and
financial services. The CRO token is utilized for on-
chain transaction settlement, and to ensure the
consensus and security of the platform. CRO is also
designed to be used as an incentivization mechanism
by providing rewards for users who engage with
various services within the Crypto.com ecosystem.
Cross-Chain and Cross-Chain Message Passing
(XCMP)
Cross-chain describes the transfer of data, tokenized
assets, or other types of information from one
independent blockchain network to another. On the
Polkadot network, XCMP is a specialized mechanism
used to send information between different
blockchains linked together on Polkadot’s
interoperable network. The XCMP system relies on
Polkadot’s collator nodes to route messages between
blockchains.
CRV TOKEN
The CRV token is the ERC-20 token that governs the
Curve protocol. CRV token holders have the ability to
propose and vote on changes to the platform. The
CRV token can be earned by providing liquidity to
designated Curve liquidity pools.
CRYPTO-BACKED LOAN
A crypto-backed loan lives on the blockchain and
requires borrowers provide cryptocurrency as
collateral. When borrowers pay back into the smart
contract, they receive their collateral.
Crypto-Backed Stablecoin Crypto-backed stablecoins
are one of four main types of stablecoins. They are
pegged to the value of an underlying cryptocurrency
asset (rather than a fiat currency, for example). With
cryptocurrency as their underlying collateral, crypto-
backed stablecoins are issued on-chain. To obtain a
crypto-backed stablecoin, a user locks their
cryptocurrency in a smart contract to receive tokens
of equal representative value to their underlying
collateral. Paying the stablecoins back into the same
smart contract allows a user to withdraw their original
collateral. DAI is the most prominent stablecoin in this
category.
CRYPTO-COLLATERALIZED LOAN
Crypto-collateralized loans are a type of loan where
the issuer takes an cryptocurrency deposit as
collateral to issue a loan in another cryptocurrency or
fiat currency. The borrower must typically deposit a
higher amount of initial cryptocurrency to provide a
buffer against the market volatility common to digital
assets. These types of loans are designed so that a
borrower can access fiat liquidity while still
maintaining ownership of their digital assets in order
to avoid taxable events (such as a sale) or missing out
on market appreciation. Since these loans are
collateralized (often overly so), they are commonly
processed extremely quickly (sometimes in minutes)
without the need for traditional credit checks.
CRYPTO.COM
Crypto.com is a cryptocurrency payments platform
that promotes the widespread adoption of
cryptocurrency. The site initially ran on a dual-token
structure that used two different native tokens,
Monaco Coin (MCO) and Crypto.com Chain Token
(CRO). However, in late 2020 the platform completed
a token swap which consolidated the network under
the CRO token, which is now used as the platform's
primary payment token for cross-asset settlements,
block transaction fees and validation rewards, and as
a staking mechanism to unlock tiered user benefits.
CRYPTOCURRENCY
Cryptocurrency is a digital asset that circulates on the
internet as a medium of exchange. It employs
blockchain technology — a distributed ledger of
transactions that is publicly available — and is secured
by advanced cryptography. This revolutionary asset
architecture allows for certainty that cryptocurrency
coins and tokens cannot be double-spent even in the
absence of a centralized intermediary. The first
cryptocurrency to acheive mainstream success was
Bitcoin which paved the way for the proliferation of
many other cryptocurrencies.
CRYPTOCURRENCY EXCHANGE
A cryptocurrency exchange is a type of digital currency
exchange where digital assets can be bought, sold,
and traded for fiat currency or other digital assets.
They are similar to mainstream exchanges where
traditional stocks are bought and sold in the type of
transactions and orders that users can execute.
Cryptocurrency exchanges have evolved significantly
from the earliest iterations (which were often
unregulated) to provide more security and
accessibility and ensure legal compliance in
accordance with the jurisdictions in which they
operate. As the cryptocurrency space continues to
grow, more exchanges have emerged which provide
competitive trading fees, exchange rates, and user-
friendly features as they vie for more users and
trading volume.
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Cryptocurrency Mixers and Tumblers
Cryptocurrency mixers and tumblers provide a
custodial mixing service where a user deposits
cryptocurrency to be mixed for privacy reasons.
Although coin mixing doesn’t guarantee complete
privacy, it makes tracing transactions more difficult.
These services are sometimes used to launder “dirty
coins,” which are garnered through criminal activity.
This is done by mixing dirty coins with coins from
different wallets, then transfering the “cleaned” coins
to another wallet. While cryptocurrency mixers are
also used for non-criminal purposes, some countries
have cracked down on their use altogether. Service
providers typically charge a 1-3% fee for this type of
service. These services seem to be waning in
popularity as newer, non-custodial options have
appeared.
CRYPTOCURRENCY PAIRS
A trading pair refers to the matching of a buy order
and a sell order for any type of asset. When a trading
pair is available for cryptocurrencies, it means that
you can view the value of one cryptocurrency asset
relative to another cryptocurrency asset. This is most
typically available with bitcoin (BTC) and allows you to
see how much a given asset is worth in BTC instead of,
say, a fiat currency. Cryptocurrency pairs help
establish value between cryptocurrencies without
referring back to fiat currency.
CRYPTOCURRENCY WALLET
Cryptocurrency wallets come in a variety of forms,
their most basic function is to store a user’s private
and public keys and interact with various blockchains
enabling users to send and receive digital currency
and monitor their cryptocurrency balances. Wallets
have a public address that can be given out for people
to send you digital assets, and a private key to confirm
the transfer of digital assets to others. Wallets can be
digital (software) or physical (hardware), hot
(connected to the internet) or cold (disconnected
from the internet), custodial (a trusted third party has
control of a user’s private keys) or non-custodial (only
the user controls their private keys).
CRYPTODEFENSE RANSOMWARE
CryptoDefense in an advanced subset of CryptoLocker
Ransomware that appeared around 2014. It used
public-key cryptography, and targeted computers
running the Windows operating system. The infection
was spread through spam emails with infected PDF
documents. Victims were often given 72 hours to pay
ransom, collected largely in Bitcoin, in order to regain
access to their infected files which would otherwise
be permanently deleted.
CRYPTOGRAPHIC PROOFS
Cryptographic proofs are commonly built into
blockchain networks that seek to hide sensitive
information. Cryptographic proofs are used to prove
and verify certain data without revealing any other
details about the data itself. They are designed to
conceal details such as ownership and other sensitive
data from other parties that participate in the
network. zk-SNARKS are one of the most effective and
well-known types of cryptographic proofs.
CRYPTOJACKING
Cryptojacking refers to a type of attack where the
victim's computer, or other hardware, is turned into a
cryptocurrency mining device without their
knowledge. Victims' devices and electricity are then
used to generate cryptocurrency mining rewards on
behalf of the attacker. Cryptojacking can be carried
out remotely through malware or by someone with
direct physical access to the device.
CRYPTOKITTIES
Cryptokitties is a blockchain game created by Axiom
Zen in 2017. The game allows players to purchase,
sell, and breed digital collectible cats that are ERC721
tokens, also called non-fungible tokens (NFTs).
CRYPTOLOCKER RANSOMWARE
CryptoLocker Ransomware is a type of ransomware
that first appeared around 2013. It infiltrated
computers through spam emails, which included an
infected ZIP file as attachment, in its first wave of
attacks. Attackers used encryption algorithms to
encrypt infected files and systems, which then spread
to other devices through network drives. A second
version of CryptoLocker was spread through the peer-
to-peer botnet Gameover ZeuS, which used a botnet
to send spam or fake emails that would lure victims
into executing exploit kits.
CRYPTOMINING
Cryptocurrency mining is the process of solving
equations in a Proof-of-Work consensus mechanism
to verify transactions and add new blocks to the
blockchain. Computers that support a blockchain
network are called nodes, and the process by which
they solve complex equations is called mining. Miners
are those who operate these computers. For their
efforts, they are compensated with a mining reward,
typically in the blockchain’s native cryptocurrency.
CRYPTO RANSOMWARE
Crypto ransomware uses encryption to maliciously
block access to a user’s data. Victims of a crypto
ransomware attack are told to pay a ransom in return
for releasing their locked data. In recent years,
attackers have demanded ransoms to be paid in
cryptocurrencies such as bitcoin.
CRYPTO TOKEN
A crypto token is a blockchain-based unit of value that
organizations or projects can customize and develop
22
for use within existing blockchain ecosystems. Crypto
tokens can be programmable, transparent,
permissionless, and trustless. They can also serve
many functions on the platforms for which they are
built, including being used as collateral in
decentralized financial (DeFi) applications, accessing
platform-specific services, voting on DeFi protocols
and even taking part in games.
CRYPTOWALL RANSOMWARE
CryptoWall is an advanced subset of CryptoLocker
Ransomware that first appeared around 2014. It used
a sophisticated encryption algorithm and spread
through email attachments, exploit kits, and drive-by
downloads. In order for a user to regain access to
their infected files, ransom was demanded in Bitcoin
and Litecoin.
CTOKENS
cTokens are the lending tokens native to the
Compound DeFi platform. When users deposit a
cryptocurrency using the Compound protocol, they
receive cTokens which represent the initial deposit
plus accrued interest. For example, lending DAI to
Compound gives the lender cDAI, which automatically
earns interest for the cDAI holder. At any time, cDAI
can be returned to Compound in exchange for the
original DAI plus the accumulated interest.
CURRENCY CRISIS
A currency crisis is a type of financial crisis
characterized by a nation's fiat currency losing its
value. A currency crisis arises when investors become
leery of holding a country's assets. For example, when
investors lost confidence in the Icelandic financial
sector, the country faced a currency crisis when the
value of Icelandic currency fell by 60% between the
end of 2007 and the end of 2008.
CURVE (CRV)
Curve is a DeFi cryptocurrency exchange optimized for
low slippage and low fee swaps between assets
pegged to the same value. Curve is an automated
market maker (AMM) that relies on liquidity pools and
rewarding those who fund the pools, and deals only in
stablecoins. CRV is the governance token of Curve,
and is also used to pay liquidity providers.
CUSTODIAL WALLET
A custodial wallet is a type of cryptocurrency wallet
where a third party holds a user's private keys and
cryptocurrency funds. With a custodial wallet, a user
must trust a third party to secure their funds and
return them upon request. The most common
custodial wallets are web-based exchange wallets.
CUSTODIAN
A custodian is responsible for securely storing assets,
such as cryptocurrency, for another institution or
individual. Typically, custodial services are targeted at
institutional investors who hold large amounts of
cryptocurrency. Custodians are often exchanges that
host cryptocurrency wallets for their users.
CUSTODY
Custody refers to the legal ability for a financial
institution to hold and protect financial assets for its
customers with the aim of preventing asset theft or
loss. Custodians may hold assets in both electronic
and physical form. Because they are responsible for
safeguarding assets for many customers (potentially
worth billions of dollars), custodial firms tend to be
extremely large and reputable institutions. With
cryptocurrency and blockchain custody solutions,
custodianship may also include the management and
safekeeping of a customer’s private keys.
Cryptocurrency exchanges often custody their
customers' private keys and cryptocurrency holdings.
CUSTOMER DUE DILIGENCE (CDD)
Customer Due Diligence (CDD) is the process of
verifying the identity of potential customers. Typically
this process gathers facts about potential customers
enabling an organization to assess the extent to which
the customer may expose the organization to a range
of risks, including money laundering and terrorist
financing activities. This process usually entails
obtaining a customer's name, residential address, and
official government documentation that includes their
photograph and date of birth.
CUSTOMER IDENTIFICATION PROGRAM (CIP)
Established by the U.S. Patriot Act of 2001 and
implemented in 2003, the Customer Identification
Program (CIP) prescribes the minimum standards with
which financial institutions must confirm the identity
of a new customer in connection with opening an
account. Each financial institution's CIP is proportional
to the its size and type of business, types of accounts
offered, methods of opening accounts, and other
factors. The objective of this program is to minimize
the degree to which the U.S. financial system is used
for money laundering and terrorist financing activities.
CYBER ATTACK
A cyber attack is a malicious online data intrusion
carried out by criminals against a computer system,
network, or related software or hardware device.
Cyber attacks are used to disable a target network or
computer system, steal or destroy important data, to
compromise computers to launch even more complex
and damaging attacks.
CYBERSECURITY
Cybersecurity — also referred to as computer security
or information technology (IT) security — is the
practice of protecting computer networks and
systems from damage and theft of hardware,
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software, electronic data, and curtailing disruption of
the services they provide. The importance of robust
cybersecurity continues to increase as the world
becomes more technologically reliant on computers,
mobile devices, Wi-Fi, wireless networks, smart
devices, the Internet of Things (IoT), and related
technologies due to their susceptibility to security
breaches and hacks.
DAEMON
A daemon is a computer program that runs as a
background process on a computing device rather
than being controlled by an interactive user. Daemons
are usually initiated upon booting up the computer,
rather than being activated manually. They typically
control functions like responding to network requests
and detecting hardware activity.
DAI
DAI is an ERC-20 stablecoin token released by the
Ethereum-based MakerDAO protocol that is used to
facilitate collateral-backed loans without an
intermediary. DAI is pegged to the US dollar in a 1:1
ratio so that each DAI should always be worth $1 USD.
DAI is a decentralized crypto-backed stablecoin, and
thus maintains its USD peg by using collateral in the
form of cryptocurrencies like ETH.
DAPPCHAIN
On the Loom Network, a dAppChain is a dApp-specific
transaction sidechain built on top of the base
Ethereum blockchain to maximize efficiency. A
dAppChain can handle complex processing tasks and
even host entire dApps, all while minimally interacting
with the base layer blockchain to which it is anchored.
Applications developed using the Loom Network
feature a unique dAppChain to carry out distinct
consensus model, protocols, and optimizations.
DARKNODES
RenVM is an inter-blockchain liquidity network made
up of thousands of independently operated nodes
called Darknodes. Anyone can run a Darknode, but
each node must run the RenVM software via a Virtual
Private Server and deposit 100,000 REN tokens into
the Darknode Registry Contract. This mechanism
incentivizes the node operators to refrain from
malicious behavior at the risk of forfeiting their
deposit. Darknodes collectively act as a trustless,
decentralized custodian of the digital assets that users
lock up on the RenVM platform, and collect fees every
time RenVM converts a digital asset into an ERC-20
token.
DARK WEB
The dark web is a segment of the internet
intentionally hidden from conventional search engines
and only accessible by means of special software. The
most common web browsers used to access the dark
web are Tor and I2P, which use masked IP addresses
in order to hide the identity of dark web users and site
owners. The dark web is typically associated with
cybercrime and illicit activity. The dark web
constitutes a small sliver of the larger deep web,
which is also hidden from conventional search
engines, but is not generally associated with illicit
activity.
DATA PACKET
A data packet is a unit of data that can be transferred
over a network. They are usually measured in
megabytes (MB) or gigabytes (GB). A live internet
connection contains a constant back-and-forth
exchange of data packets.
DATA SCRAPING
Data scraping, also known as web scraping, refers to
methods with which computer programs extract data
from websites for use in local databases or other
application. Data scraping is most commonly used to
gather content, prices, or contact information from
online sources. While there are valid legal use cases
for data scraping tools, the same software can also be
used to download and reappropriate data for
unauthorized purposes, such as identifying pseudo-
anonymous web service users or plagiarizing branded
content.
DATA VERIFICATION MECHANISM (DVM)
The Data Verification Mechanism (DVM) is the oracle
process used to resolve disputes on the UMA
protocol. When there is a price dispute between two
parties a synthetic token derivative contract, the DVM
requests UMA token holders vote on the correct price.
The DVM then relays the correct price to the
requestor and rewards UMA token holders for their
vote.
DAY TRADER
In traditional markets, day traders execute a trading
strategy that involves only holding intraday positions
and do not hold open positions overnight. Day traders
attempt to take advantage of short-term price
fluctuations between highly liquid assets. Day trading
is generally regarded as a riskier investment than
long-term strategies.
DEAD COIN
Dead coins are cryptocurrencies that have been
abandoned by defunct projects. Several criteria are
used to designate dead coins: inactive webpages, lack
of development updates, lack of active nodes, and less
than $1,000 USD trading volume over three months.
Over 1,000 dead coins have been documented as of
2020.
24
DEATH CROSS
A death cross is a bearish technical trading signal in
which the 50-day moving average crosses below the
200-day moving average, typically triggering a major
sell-off. It is the opposite of a Golden Cross trading
signal, and has been evident prior to many of the
largest stock market crashes in history.
DEBT INSTRUMENT
A debt instrument is a tool that an individual,
government, or business entity can use to obtain
capital. Credit cards, credit lines, loans, and bonds can
all be types of debt instruments. The term debt
instrument is used primarily for institutions that are
trying to raise capital, usually in the form of a
revolving line of credit that is not typically associated
with a primary or secondary market. More complex
debt instruments involve an advanced contract
structure and the involvement of multiple lenders or
investors, usually via an organized marketplace.
DECENTRALAND (MANA)
Decentraland is a virtual world that is integrated with
Ethereum. On the Decentraland platform, users can
explore a multifaceted, user-generated landscape that
incorporates real estate, gaming, and social media
elements. MANA, an ERC-20 token, is the digital asset
token used to pay for goods and services in
Decentraland, while LAND is a a non-fungible ERC-721
token that represents the ownership of virtual land.
DECENTRALIZED APPLICATIONS (DAPPS)
Decentralized applications — dApps — use blockchain
technology to address use cases ranging from
investment to lending to gaming and governance.
Although dApps may appear similar to web
applications in terms of UX, dApp back-end processes
eschew centralized servers to transact in a distributed
and peer-to-peer fashion. Rather than using the
central HTTP protocol to communicate, dApps rely on
wallet software to interact with automated smart
contracts on networks like Ethereum.
DECENTRALIZED AUTONOMOUS ORGANIZATION
(DAO)
A decentralized autonomous organization (DAO) is a
blockchain-based organization that is democratically
managed by members through self-enforcing open
source code and typically formalized by smart
contracts. DAOs lack centralized management
structures. All decisions are voted upon by network
stakeholders. DAOs often utilize a native utility token
to incentivize network participation, and allocate
proportional voting power to stakeholders based on
the size of their stake. As DAOs are built on top
blockchains — often Ethereum — their transactions
are executed transparently on the underlying
blockchain.
DECENTRALIZED EXCHANGE (DEX)
A decentralized exchange (DEX) is a financial services
platform or apparatus for buying, trading, and selling
digital assets. on a DEX, users transact directly and
peer-to-peer on the blockchain without a centralized
intermediary. DEXs do not serve as custodians of
users' funds, and are often democratically managed
with decentralized governance organization. Without
a central authority charging fees for services, DEXs
tend to be cheaper than their centralized
counterparts.
DECENTRALIZED FINANCE (DEFI)
Decentralized finance (DeFi) is a major growth sector
in blockchain that offers peer-to-peer financial
services and technologies built on Ethereum. DeFi
exchanges, loans, investments, and tokens are
significantly more transparent, permissionless,
trustless, and interoperable than traditional financial
services, and trend towards decentralized governance
organizational methods that foster equitable
stakeholder ownership. Platform composabiltiy in
DeFi has resulted in unlocking value through
interoperability with innovations like yield farming
and liquidity tokens.
DECENTRALIZED GOVERNANCE
For blockchain networks and dApps, decentralized
governance refers to the processes through which the
disintermediated, equitable management of a
platform is executed. It involves different
methodologies for voting on platform tech, strategy,
updates, and rules. Blockchain governance is typically
conducted using two distinct systems: on-chain
governance and off-chain governance. On-chain
governance relies upon blockchain-based systems,
typically using automatic cryptographic algorithms
through the network’s computational architecture
and underlying consensus mechanism. Off-chain
governance refers to decision making that is not
codified on the blockchain, often on online forums or
face-to-face.
DECENTRALIZED IDENTIFIER (DID)
A decentralized identifier (DID) is a form of digital
identification that enables the holder to prove identity
without the need for a centralized registry, identity
provider, or certificate authority. DIDs are an
emergent development, and therefore have yet to be
thoroughly vetted. The establishment of a DID
standard is a crucial step towards the broad
application of true Self-Sovereign Identities (SSI).
DECENTRALIZED NETWORK
A decentralized system is a conglomerate of
connected, but separate entities that communicate
with one another without a central authority or
server. They stand in contrast to centralized systems,
which feature a central point of governance.
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Blockchains are an example of a decentralized system:
the data ledger of a blockchain is distributed amongst
all the decentralized network participants (nodes),
which must achieve consensus on the content of the
data for the network to function. Without a single
point of authority, decentralized systems like
blockchains also lack a single point of failure, which
means that a single damaged node cannot
incapacitate the blockchain as a whole.
Decentralized Storage Network (DSN)
A Decentralized Storage Network (DSN) is a network
that provides peer-to-peer access to users with the
capacity to rent out their available hardware storage
space. With the help of end-to-end encryption
techniques, clients privately transmit files peer-to-
peer via DSNs that provide cryptographic proofs for
security. The Filecoin protocol is an example of a
blockchain-based decentralized storage network, one
that reduces the risk of data failures that can occur
with a single centralized point of failure. On DSN
platforms, smart contracts are used to formalize
terms between providers and users.
Delegated Proof of Contribution (DPoC)
Delegated Proof of Contribution (DPoC) is a unique
economic governance protocol implemented on the
ICON Network that leverages the ICON Incentives
Scoring System (IISS). DPoC is a variant of Delegated
Proof of Stake (PoS) in that stakers delegate votes
towards block validation privileges, but DPoC sees ICX
holders delegating tokens towards individuals who
have exercised positive participation on the network
rather than for particular nodes. The elected entity
then validates blocks on a delegate's behalf, and earns
token rewards accordingly.
Delegated Proof of Stake (DPoS)
Much like the more widespread Proof-of-Stake (PoS)
system, Delegated Proof of Stake (or DPoS)
incentivizes users to confirm network data and ensure
system security by staking collateral. However, the
distinctive characteristic of DPos is its voting and
delegation structure. In contrast to PoS, where nodes
are usually awarded the ability to process new blocks
based solely on the total amount each node stakes,
the DPoS system allows users to delegate their own
stake to a node of their choosing — known as a
delegate — and vote for the nodes to earn block
validation access. Elected validators receive block
rewards after verifying the transactions in a block, and
those rewards are then shared with users who
delegated them as validators.
DELEGATION
Delegation refers to the contribution of some amount
of a cryptocurrency or token to another user for
participation in a network staking mechanism on
Delegated Proof-of-Stake (DPoS) blockchain protocols.
It is useful for users who want to earn staking rewards
and participate in a network, but do not have a large
enough stake to meet the minimum requirements on
their own. DPoS intend to achieve a higher degree of
equitability and democratization through delegation
mechanisms
DENIAL-OF-SERVICE (DOS) ATTACK
A Denial-of-Service (DoS) attack is a type of digital
attack on a network that attempts to incapacitate a
system by overwhelming it with repeated requests. It
is a malicious effort to disrupt normal traffic to a
website or other internet property to temporariy
crash the underlying network and make it non-
functional.
DEPTH LIMITED SEARCH (DLS) ALGORITHM.
The Depth Limit Search (DLS) is a specialized
consensus algorithm used within the Cosmos Network
blockchain. It is designed to solve the specific
technical problem of the infinite path challenge as it
relates to uninformed search algorithms. While the
DLS algorithm is very memory efficient, it suffers from
a lack of completeness.
DERIVATIVES
A derivative is a financial contract that derives its
value from underlying traits of an asset, index, or
interest rate. Futures and options contracts are
examples of derivatives. There are a variety of
blockchain-enabled cryptocurrency derivatives,
including synthetic cryptocurrencies and bitcoin
futures, which represent agreements to trade bitcoin
at a future date at a predetermined price.
DESHIELDING TRANSACTIONS
Deshielding transactions are a type of transaction
used on the Zcash blockchain that are sent from a
private, anonymous sender to a public, transparent
receiver wallet. Deshielding transactions employ zk-
SNARK cryptographic proof technology to maintain
data privacy, despite the differing settings of sender
and recipient.
DESIGN AXIOMS (DAS)
Design axiom (DA) is the term given to the critical
elements of the Crypto.com blockchain's technical
architecture. The Crypto.com technical whitepaper
notes six design axioms critical to the overall success
of the project: state-of-the-art security architecture; a
scalable; a fast network with high transaction
throughput; decentralization; upgradeability; data
privacy; and an inclusive network design.
DESKTOP WALLET
A desktop wallet is a software wallet for
cryptocurrency and digital assets that is downloaded
directly onto a computing device. Desktop walets are
almost always non-custodial in nature, which means
users control their own private keys. Desktop wallets
26
are hot wallets, meaning they are connected to the
internet — unless the computing device is turned off
or the wallet is installed on an offline secondary
computer. Most desktop wallets offer password
protection and can generate a recovery phrase as a
backup to regenerate keys.
DETERMINISTIC MODULE
A deterministic module is a section of independent
electronic circuits built into a circuit board that
provides functions on a computer system that do not
feature any degree of randomness. A deterministic
module will thus always produce the same output
from a given starting condition or initial state. A
blockchain-based computerized system is typically
deterministic in nature.
DIGITAL ASSET
Digital asset is the catch-all term for assets that exist
digitally. The term covers a wide variety of assets,
including cryptocurrencies, utility tokens, security
tokens, digital stocks, and digital collectables. All
cryptocurrencies are digital assets, while not all digital
assets are cryptocurrencies.
DIGITAL CURRENCY ELECTRONIC PAYMENT (DCEP)
Digital Currency Electronic Payment, or DCEP, is
China’s central bank digital currency (CBDC) initiative.
Underway since 2014, DCEP is intended to replace
physical cash with a digital edition of China's RMB that
can be exchanged between digital wallets without
involving a bank. In contrast to decentralized
blockchains, the Chinese government will maintain
centralized authority over the platform and currency,
which has undergone a number of large-scale public
trials.
DIGITAL DOLLAR
The 'digital dollar' is the commonly used reference of
a potential United States central bank digital currency
(CBDC). United States government agencies are
researching the potential benefits and risks associated
with creating a CBDC, but no clear path forward has
yet been indicated.
DIGITAL IDENTITY
The NEO network establishes a digital identity for
each asset and user on its network. An active
participant in the network undergoes a thorough
identification process linking them to a traceable, real-
world identity that is compliant with regulatory
requirements. The network creates this digital identity
through a combination of facial recognition, biometric
data, voice recognition, and other multi-level
verification mechanisms. This mechanism helps create
accountability and trust in the NEO network as a
whole.
DIGITAL SIGNATURE
A digital signature in cryptocurrency is the process of
using a private key to digitally sign a transaction.
Through public-key cryptography, a digital signature
authenticates the sender and recipient of a
transaction. It allows anyone with the sender’s public
key to verify the digital signature or the authenticity of
the message, transaction, or data.
DILUTION
Dilution is an economic term referring to the issuance
of new assets which decrease existing shareholders'
percentage of ownership. Dilution can occur with
assets ranging from stocks to cryptocurrencies. In the
case of cryptocurrency, dilution refers to the
reduction in value of a single unit of currency, or the
market capitalization of a cryptocurrency protocol
overall, because of the creation of new tokens.
DIRECTED ACYCLIC GRAPH (DAG)
A directed acyclic graph (DAG) is a form of Distributed
Ledger Technology (DLT). In contrast to a blockchain,
which groups transactions into blocks and orders
them in a linear fashion, a DAG is a network of
individual transactions themselves connected only to
other transactions without blocks. While blockchains
require block validation, in a DAG, individual
transactions provide validation for one another. All
network users in a DAG are simultaneously miners
and validators, and therefore transaction fees tend to
be much lower than those common to blockchain
networks.
DIRECTIONAL TRADING
Directional trading refers to trading strategies in
which the sole factor for investment is the future
direction of the overall market. It is generally
associated with options trading because different
directional trading strategies can capitalize on moves
both upward and downward.
DISCOUNTED CASH FLOW MODEL
The discounted cash flow (DCF) model is a valuation
tactic that helps investors determine the present
value of an investment by estimating how much
money it will make in the future. DCF analysis projects
future cash flows by using a series of assumptions
about how the company or asset will perform in the
future, and then forecasting how this performance
translates into the cash flow generated. The future
cash flows are discounted back in a net present value
(NPV) calculation, which represents the amount an
investor should be willing to pay today for receiving
an asset’s cash flows in the future.
DISTRIBUTED DENIAL-OF-SERVICE (DDOS) ATTACK
Similar to a Denial-of-Service (DoS) attack, a
Distributed Denial-of-Service (DDoS) attack is a type of
malicious network offensive conducted by a number
27
of systems against a target. In a DDoS attack,
perpetrators use traffic from many different sources
to flood a connected machine or service with requests
in an effort to overwhelm its network and make it
unavailable for use. Because multiple traffic sources
are more difficult to identify, DDoS attacks are
significantly more challenging to combat than DoS
attacks.
DISTRIBUTED LEDGER TECHNOLOGY (DLT)
Distributed Ledger Technology (DLT) refers to a shared
database upon which transactions and associated
details are recorded in multiple places simultaneously.
A DLT may be a permissioned network under control
by a central authority, or a permissionless network
maintained by a decentralized network of nodes
lacking a central authority. Blockchains and Directed
Acyclic Graphs (DAGs) are both examples of different
types of DLT.
DIVERSIFICATION
Diversification refers to keeping a diverse investment
portfolio of assets to protect against market turmoil.
Different investments tend to perform differently
depending on what’s happening in the market, so
owning a variety of diverse assets means that when
some lose value, others may gain value. A well-
diversified portfolio usually includes a mixture of
stocks, fixed income (bonds), and commodities. A
diversified portfolio may also include one or more
crypto assets, which should also be diversified.
DIVIDEND
Dividends are regular payments made by a stock
issuing company to its company's shareholders. While
not all stocks pay dividends, the exact distribution of
stock dividends is determined by a company's board
of directors. Dividends are usually paid in cash,
although they are sometimes paid in new shares of
additional stock.
DIVIDEND REINVESTMENT PLAN (DRIP)
A dividend reinvestment plan (DRIP) takes dividends
earned by investors in a company and automatically
reinvests them into more stocks of that company,
often at a discounted rate. A DRIP accomodates the
potential for exponential earning: Dividends are
reinvested in more stock, which in turn generates
more dividends, and so on. However, investors are
usually given the choice to reinvest their dividends or
cash them out befoe the DRIP initiates.
DNV GL
DNV GL is a Norwegian and German accredited
registrar and classification company that has about
14,500 employees and 350 offices in more than 100
countries. DNV GL has a direct partnership with
VeChain to provide assurance and auditing services
for many of the enterprises VeChain works with, and
provides data for supply chain management, carbon-
neutral vehicles, logistics, natural gas, and more.
DOT COIN
DOT is the native cryptocurrency of the Polkadot
blockchain protocol. It is used to help maintain the
security and consensus of the Polkadot Relay Chain
and other parts of the network (parachains, collators,
fishermen, and nominators). DOT can be bonded
through parachains, staked through validators, and
used for other purposes. It is typically rewarded to
users who stake DOT to run a validator node. DOT
helps the Polkadot ecosystem maintain a fair and
transparent governance structure through validator
staking and other mechanisms.
Double Spend Problem
The double-spending problem refers to a critical risk
with digital currencies where the same funds can be
copied and spent more than once. With fiat currency,
the spender transfers physical cash to the receiver,
unable to spend it again. With digital currency,
blockchain systems are devised to prevent a digital
token, such as bitcoin, from being sent by more than
one address. The risk of double-spending with
cryptocurrencies is mitigated by various mechanisms
that verify the authenticity of all transactions.
Dow Jones Industrial Average (DJIA)
The DJIA, or the Dow, is a widely-used index and
barometer of stock market performance that consists
of 30 stocks from multiple sectors. Companies
included in the Dow are known as blue chip stocks
because of their importance to the overall economy of
the United States. The DJIA is calculated by adding the
prices of the stocks and dividing the final value by a
Dow divisor.
Due Diligence
In finance, due diligence refers to an examination of
financial records that takes place prior to entering into
a proposed transaction with another party. Due
diligence broadly refers to an investigation, audit, or
review performed to confirm the facts of a matter
under consideration. The term originated in the US
with the Securities Act of 1933 that made securities
dealers and brokers esponsible for fully disclosing
material information about the securities they were
selling at the risk of criminal prosecution. Now, it is a
standard process in business transactions and
arrangements.
Dust
Dust is a very small fraction of a cryptocurrency or
token that can range within one to several hundred
Satoshis, which is the smallest divisible unit of a
bitcoin. Dust is a residual byproduct of trading and
transacting with cryptocurrencies, and represents
such small denominations of currency that it retains
minimal monetary value.
DUSTING ATTACK
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A dusting attack is an attack in which a trace amount
of cryptocurrency, called dust, is sent to thousands —
sometimes even hundreds of thousands — of wallet
addresses. This attack is deployed in order to track
these addresses with the hope of “un-masking” or de-
anonymizing them. These mass dustings may also be
used as stress tests, where a large amount of dust is
sent in a short amount of time to test the throughput,
or bandwidth, of a network. Some say these dustings
are also a way to spam a network, by sending huge
batches of worthless transactions that clog and slow it
down considerably.
DUST LIMIT
Any address or unspent transaction output (UTXO)
that has a lower balance than the current fee charged
to transact on that blockchain is under what is called
the dust limit. The dust limit varies by market forces
on the network and varies between different
cryptocurrency networks, but the funds are rendered
without function unless the balance is restored above
the transaction fee enough to trade or withdraw.
DUTCH EAST INDIA COMPANY
The Dutch East India Company was a trading
megacorporation formed in the early 17th century for
trading spices with India and, later, with Southeast
Asia. The company is considered the first modern
corporation due to it's sophisticated structure and
operations. It was also the first publicly-held company
and its shares were traded at the Amsterdam
Exchange. At its peak, the company is estimated to
have been worth $7.9 trillion when accounting for
inflation.
EARNINGS PER SHARE (EPS)
Earnings per share (EPS) is a method used in
fundamental analyses of a company's profitability.
Fundamental analysis involves evaluating a company's
stock rather than just its earnings. Earnings and shares
combined can provide a great deal of insight into a
company’s profits. EPS tells us how much of a
company's profit is assigned to each share of stock.
EPS is calculated as net income (after dividends on
preferred stock) divided by the number of outstanding
shares.
ECONOMIC X NODE (XN) AND ECONOMIC NODE (EN)
Economic X Nodes (XNs) and Economic Nodes (ENs)
are two types of nodes created and used by the
VeChain Foundation. They incentivize coin holders to
run a node in exchange for tokenized VET rewards,
and help maintain network consensus alongside
Authority Masternodes. There are four different tiers
of XNs depending on the amount of VET staked, while
ENs have three different tiers. XNs and ENs are
managed via VeChainThor Node smart contracts and
interact with the entire blockchain system. As of 2020,
no new XNs can be created and existing XN operators
are considered long-term supporters of the project.
Ecosystem Expansion Project (EEP)
An Ecosystem Expansion Project (EEP) is an ICON-
related project or activity that contributes to the
overall growth and expansion of the ICON ecosystem.
EEPs play a role in determining the ICON Network’s
governance system, along with P-Reps and their
Decentralized Application Booster Program (DBP). All
ICONists can propose and execute EEPs and receive
rewards when other ICONists delegate a certain
amount of stake to those who proposed EEPs.
EIP-1559
EIP-1599 is an Ethereum Improvement Proposal
designed to make network transactions more efficient
by using a hybrid system of base fees and tips. In the
proposal, a base fee is defined as an algorithmically
determined price that all Ethereum users would pay
to complete transactions. Tips are defined as optional
fees that users could include to speed up their
transactions. If implemented, EIP-1559 could greatly
reduce transaction costs and improve the overall
Ethereum user experience.
Electronic Retailing (E-tailing)
E-tailing is the sale of goods and services through the
internet. There are numerous types of e-tailing
including business-to-business (B2B) and business-to-
consumer (B2C) sales of products and services. E-
tailing requires companies to tailor their business
models to capture internet sales, which can include
building out new distribution channels and new
technical infrastructure.
Elliptic Curve Digital Signature Algorithm (ECDSA)
The Elliptic Curve Digital Signature Algorithm (ECDSA)
is the cryptographic signature algorithm used by
Bitcoin and several other highly regarded
cryptocurrencies, wallets, and exchanges. Through the
use of private keys, public keys, and cryptographic
signatures, the algorithm guarantees that only the
holders of private keys can send bitcoin transactions.
The tBTC system also uses ECDSA cryptography to
create tokenized bitcoin.
EMAIL SPOOFING
Email spoofing is the act of creating and sending email
messages with a forged sender address, typically with
the intent to compromise the recipient. The most
common ways this is accomplished include copying an
organization’s defining content, such as specific
phrases, fonts, logos, or color schemes used by the
legitimate website or service provider in order to
make the fraudulent message look authentic. Since
most core email protocols do not have any
authentication mechanisms, email spoofing continues
to be a widely used form of online fraud.
ENCRYPTION
Encryption refers to technical processes that secure
data and systems, and make it more difficult for
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hackers to gain unauthorized access to information, or
meddle with networks and transactions. In modern
cryptography, encryption generally entails the
conversion of what is known as “plaintext” into
“ciphertext." Encryption is a means of encoding
information so that only authorized parties can
understand it.
ENHANCED DUE DILIGENCE (EDD)
Enhanced Due Diligence (EDD) is a Know Your
Customer (KYC) process that provides a greater level
of scrutiny of potential business partnerships and
highlights risks that cannot be detected via Customer
Due Diligence (CDD) alone. It is designed for use with
customers who are deemed high-risk via the KYC
process. Relevant risk factors can include large
transaction amounts, high customer net worth,
geographical location, political exposure, and more.
Enjin (ENJ)
Enjin is a platform that enables developers to create
and manage games on the blockchain. Enjin hopes to
leverage blockchain technology to reduce the high
fees and fraud common with the transfer of virtual
goods. ENJ is an ERC-20 token used to pay for digital
goods and services on the Enjin platform.
ENTERPRISE ADOPTION
Enterprise adoption refers to the ability for a specific
service or type of technology to be used by a large
corporation, company, government, NGO, or specific
industry. Enterprise adoption of any technology
generally means that it is being used widely to solve
multiple problems for different use cases in the real-
world. It is the hope of the blockchain community that
blockchain technology will eventually achieve
enterprise adoption.
EOS
The EOS Network is a smart contract and
decentralized application (dApp) development
platform. Unlike many other blockchain networks,
EOS does not charge direct transactional fees for
operations. Instead, users wishing to transact or run a
dApp must obtain sufficient network capacity by
holding EOS coins. EOS is the native coin on the EOS
network, used for voting and accessing network
capacity.
EOS 1.0 AND EOS 2.0
EOS 1.0 was the first full version of the EOS blockchain
network released on June 1st, 2018. After several
upgrades it was replaced by the more advanced EOS
2.0 which launched on January 10th, 2020. EOS 2.0
was designed to enhance performance and security,
as well as provide new developer tools to make it
easier to build on the platform.
EOSIO CONTRACT DEVELOPMENT TOOLKIT
(EOSIO.CDT)
The EOSIO Contract Development Toolkit (EOS.CDT) is
a specialized WASM ToolChain and set of tools
designed to build, create, modify, and utilize smart
contracts within the EOSIO ecosystem.
EOSIO RPC APPLICATION PROGRAMMING INTERFACE
(API)
The EOSIO RPC application programming interface
(API) is a type of Remote Procedure Call (RPC) API
used to connect to the EOSIO blockchain. A RPC
occurs when a computer utilizes a program that
makes a procedure execute by utilizing a distinct
address space on another shared network or
computer. This is done by coding and the use of a
local procedure call without the developer giving
details for the remote interaction via location
transparency.
EOSIO SOFTWARE DEVELOPMENT KITS (SDK’S)
EOSIO software development kits (SDKs) provide tools
to make application development easier on EOS.
These SDKs are built for both Java (Android) and Swift
(iOS) programming languages. They allow software
developers to create EOS-specific applications that
can be built for the Android and iOS operating
systems.
EOS Virtual Machine (EOS VM)
The EOS Virtual Machine (EOS VM) is a high-
performance blockchain Web Assembly interpreter
used by the EOS blockchain. It is an engine that uses
three different interpreters to make it possible to
compile, debug, and optimize smart contracts. Its
main purpose is to improve the functionality and
performance of smart contracts.
EPOCH
An epoch is a division of time on the Cardano
blockchain protocol. Cardano makes use of a
proprietary Proof-of-Stake (PoS) consensus algorithm
called Ouroboros Praos, which divides the blockchain
into time-frames called epochs that last approximately
5 days. Epochs are in turn subdivided into smaller
increments called slots that last about 20 seconds.
There are currently a total of 432,000 slots (5 days) in
each epoch. In a specific slot, zero or more block
producing nodes may be selected to be the slot
leader. Typically, one node is nominated every 20
seconds, totalling over 20,000 slot leaders per epoch.
When randomly selected for the role, slot leaders
produce blocks, of which one will be added to the
blockchain, while other block candidates will be
discarded.
ERC-1155
ERC-1155 is an Ethereum-based token standard that
incorporates non-fungible token (NFT) technology.
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The ERC-1155 standard allows for a single smart
contract to manage multiple token types, including
fungible, semi-fungible, and non-fungible tokens. It is
purported as the new multi-token standard. Other
token standards like ERC-20 and ERC-721 require a
separate contract to be deployed for each token type
or collection, which results in excessive and redundant
code on the Ethereum blockchain.
ERC-20
The ERC-20 standard outlines the common set of
criteria and technical specifications an Ethereum
token must follow to function optimally and
interoperably on the Ethereum blockchain. It enables
the creation of tokenized assets that can be bought,
sold, and exchanged alongside cryptocurrencies like
bitcoin (BTC) and ether (ETH). The ERC-20 standard
utilizes smart contracts to issue tokens that can be
exchanged on the Ethereum network as well as used
interoperably between Ethereum-based dApps. It is
the most commonly used Ethereum token standard,
and has been used to create many notable digital
assets.
ERC-721
ERC-721 is a technical standard for the
implementation of non-fungible tokens (NFTs) on the
Ethereum blockchain outining provide rules that all
NFTs must follow. NFTs that adhere to the ERC-721
standard are interoperable with each other and the
wider Ethereum ecosystem. The ERC-721 standard
produces provably rare assets, and is widely used for
digital collectibles, games, art, and luxury items.
ESCROW
An escrow is a contractual arrangement in which an
intermediary receives and disburses funds or assets
on behalf of the primary transacting parties based on
predetermined conditions agreed to by the
transacting parties. Traditionally, the intermediary is a
trusted third-party arbitrator, but with the advent of
blockchain technology, this escrow service can now be
automated using algorithmically-enforced rules based
on smart contracts. The automation of escrow holds
massive potential implications across a broad range of
industries.
E-SIGNATURE
An e-signature, or electronic signature, is a signature
executed an electronic document or form. Electronic
signatures are legally valid in most jurisdictions to
replace handwritten signatures.
ETHER (ETH)
Ether (ETH) is the native cryptocurrency of the
Ethereum blockchain, and plays an integral role in the
Ethereum ecosystem. Transactions on the Ethereum
blockchain are paid for in micropayments of ETH
referred to as gas, while ether also facilitates
interactions with and between smart contracts
throughout the Ethereum platform and ecosystem.
ETHEREUM
Ethereum launched in 2015 as a decentralized,
blockchain-based global supercomputer to serve as
the foundation for an ecosystem of interoperable,
decentralized applications (dApps) powered by token
economies and automated smart contracts. Assets
and applications designed on Ethereum are built with
self-executing smart contracts that remove the need
for a central authority or intermediary. The network is
fueled by its native cryptocurrency ether (ETH), which
is used to pay transaction fees on the network. Open-
source, programmable, private, and censorship
resistant, Ethereum forms the backbone of a
decentralized internet, which has already spawned
significant innovation like Initial Coin Offerings (ICOs),
stablecoins, and decentralized finance (DeFi)
applications.
ETHEREUM 2.0
Ethereum 2.0 refers to a significant set of updates to
the Ethereum blockchain intended to vastly improve
its scalability and broader utility. The multi-phased
package of upgrades is officially called Serenity. It
features a switch from a Proof-of-Work (PoW)
consensus algorithm that relies on computational
mining to a Proof-of-Stake (PoS) consensus algorithm
that relies on validator staking to keep the network in
motion. In utilizing Proof of Stake and implementing
the innovation of partitioned shard chains, Ethereum
2.0 is expected to be much more efficient than its
prior iteration, achieving the transactional scale
required to be the global supercomputer.
ETHEREUM TRANSACTION
Ethereum transactions are code or a set of commands
that execute in a single Ethereum block. They cange
from simple token transfers to complex zero
knowledge proofs and smart contracts. Transactions
are permanently recorded onto the data state of the
Ethereum blockchain at the cessation of every block.
ETHEREUM VIRTUAL MACHINE (EVM)
The Ethereum Virtual Machine (EVM) is a
development interface accessible through a web
browser. The EVM enables developers to deploy
dApps more effectively by providing a suite of
development kits, application templates, and other
tools. The EVM improves accessibility by eliminating
the need for developers to purchase costly hardware,
and allowing developers to launch a dApp regardless
of the underlying coding language. The EVM is a
primary driver of the trend that decentralized
applications (dApps) exist almost exclusively on the
Ethereum blockchain thus far.
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EUROPEAN CENTRAL BANK (ECB)
The European Central Bank (ECB) is the main central
bank for the Eurozone, which is the monetary union of
19 European Union (EU) member states that employ
the use of the Euro (€) as the region’s main currency.
The ECB is one of the most important central banks in
the world, and serves as one of the seven institutions
that comprise the infrastructure of the EU. The main
purpose of the ECB is to maintain price stability,
regulatory certainty, fair monetary policy, and a
healthy European financial system related to banking,
investment, insurance, securities, and the EUs
financial sector as a whole. The ECB is responsible for
the authorization of Euro issuance in EU member
states.
EXCHANGE
Cryptocurrency exchanges are platforms upon which
digital assets can be bought, sold, and traded for fiat
currency or other digital assets. While they share
many similarities to stock exchanges in legacy finance,
the development of decentralized exchanges (DEXs)
removes centralized market makers and
clearinghouses in favor of peer-to-peer exchanges.
Cryptocurrency exchanges have evolved significantly
from the earliest, unregulated iterations to provide
more robust security, accessibility, and legal
compliance in accordance with the jurisdictions in
which they operate.
EXCHANGE COIN/EXCHANGE TOKEN
Exchange coins are digital assets launched on a crypto
exchange via an Initial Exchange Offering (IEO), a
fundraising method for crypto companies that's
similar to an Initial Coin Offering (ICO). There are two
different types of exchange coins: those launched by
the exchange itself as the native token of the
platform, and those launched by other crypto
companies using the token launch infrastrucure and
services of the exchange. Exchange coins can either be
tokens (digital assets enabled by an existing
blockchain) or cryptocurrencies (digital assets that run
on their own blockchain).
EXCHANGE TRADED FUND (ETF)
An exchange-traded fund (ETF) is a financial product
that is tied to the price of other financial instruments.
This structure gives investors a way to gain exposure
to an asset or a bundle of assets without buying or
owning the asset(s) directly. ETFs can be composed of
all kinds of assets including stocks, commodities, and
bonds. A digital asset ETF, for example, would allow
investors to invest in the underlying digital asset
without needing to manage the asset itself or interact
with a cryptocurrency exchange.
EXCHANGE-TRADED PRODUCT (ETP)
An exchange-traded product (ETP) is a type of security
that tracks an underlying security, index, or financial
instrument asset, and can be purchased on an
exchange. ETPs trade on the National Stock Exchange
(NSE) during the day. The first crypto ETPs went to
market in 2019.
EXECUTION PRICE
An execution price is the price at which a buy or sell
order for a security is completed, or executed. As
prices fluctuate in a dynamic market, what is offered
for a trade in as an order price might not always be
identical to the price at the execution price of the
trade. A strong execution price very little slippage or
change in price from an order price and is a sign of a
healthy market and asset.
EXPLOIT KITS
Exploit kits are automated programs that contain code
for identifying vulnerabilities and installing malware.
They are a type of toolkit that cybercriminals use to
attack weaknesses in computing systems. Once
they've infected a victim machine, they compile
device information, search for vulnerabilities,
determine the appropriate or most effective exploits,
and then deploy those exploits on behalf of the
exploit kit user.
EXPONENTIAL DECAY MODEL
The exponential decay model is a cryptoeconomic
minting mechanism used by numerous blockchain
projects to mitigate inflation. Blockchains that follow
the model produce higher native currency rewards
during the launch and early stages of the network,
which decrease exponentially over time, along with an
increasing difficulty in block mining in propagation.
The model has been criticized for enabling a miner
incentivization imbalance.
EXTENDED PRIVATE KEY (XPRIV)
An extended private key (XPRIV) is one half of the
master key pair (the other being an extended public
key) used in hierarchical-deterministic wallets. A
hierarchical-deterministic wallet is a cryptocurrency
wallet that generates new cryptographic key pairs or
addresses from a master key pair each time funds are
received.
EXTENDED PUBLIC KEY (XPUB)
An extended public key (XPUB) one half of the master
key pair (the other being an extended private key)
used in hierarchical-deterministic wallets. A
hierarchical-deterministic wallet is a cryptocurrency
wallet that generates new cryptographic key pairs or
addresses from a master key pair each time funds are
received.
FAIR LAUNCH
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Fair launch refers to the equitable and transparent
initial distribution of coins in a blockchain project. Fair
launches stand in contrast to a token distribution in
which a small group of founders and early investors
receive special or early access to the tokens. They are
seen as an effective way to promote decentralization
and engagement in the crypto community.
FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC)
The Federal Deposit Insurance Corporation (FDIC) is
an independent federal agency in the US that insures
deposits in financial institutions, acting as a guarantor
in the event of an institution failing. The FDIC was
created in the 1933 Banking Act to restore faith in
banks during the Great Depression. Its ongoing
purpose is to foster confidence in financial
institutions.
FEDERATED BYZANTINE AGREEMENT
Federated Byzantine Agreement (FBA) is a consensus
method developed and deployed by the Stellar
blockchain protocol. It operates by a system of
federated voting wherein nodes deem other nodes
trustworthy until a quorum is achieved and network
consensus is solidified.
FIAT-BACKED STABLECOIN
Fiat-backed stablecoins are digital assets pegged to
the value of an underlying fiat currency in a 1:1 ratio,
and are built to reduce the volatility commonly
associated with digital assets. Stablecoins not only
serve as a store of value and an investment hedge, but
simplify engagement in on-chain endeavors like
decentralized finance. The fiat currency which serves
as collateral to a stablecoin — the most common
being USD — is held off-chain, which requires users to
trust that the fiat reserves are properly managed and
audited.
FIAT CURRENCY
A fiat currency is any type of government-issued
currency that is used as legal tender by a specific
nation or region’s citizens and government. Fiat
currencies are not backed by a physical commodity
(like gold or silver), but instead by the government
that issued it. As a government-regulated instrument,
it functions as a medium of exchange, store of value,
and unit of account. To function as fiat, money must
be durable, portable, divisible, uniform, acceptable,
and limited in supply. Most modern paper currencies
are fiat currencies, like the EU euro, Japanese yen, and
US Dollar.
FIAT ON-RAMP
A fiat on-ramp is an exchange or similar service that
allows for digital assets like securities and
cryptocurrencies to be exchanged for fiat currency like
the US dollar. On-ramps are a software-based service
built by a financial service provider, usually with a
banking license to legally operate in their specific
jurisdiction. A fiat on-ramp is the first step in
exchanging or trading cryptocurrencies for many users
who first purchase digital assets with fiat currency.
FIBONACCI RATIOS
The Fibonacci ratio (also called the “golden ratio”)
describes predictable balancing patterns in elements
found throughout nature, including atoms. It is named
after Leonardo Fibonacci who lived around 1200 AD
and is credited with discovering the ratio. In the
Fibonacci sequence, each number is the sum of the
two preceding numbers (1, 1, 2, 3, 5, 8, 13, etc.). Four
main techniques are used to apply the Fibonacci
sequence to finance: retracements, arcs, fans, and
time zones.
FIL_BASE
The Filecoin (FIL) base of 2,000,000,000 FIL coins is the
maximum number that will ever exist and is known as
FIL_BASE. 55% of the FIL_BASE is allocated to storage
mining, 15% is allocated to a mining reserve, and the
remaining 30% is allocated to various other
developmental projects. Filecoin’s coin allocation
methodology intends to ensure the growth of both
long-term and short-term network participation, while
applying counter-pressure to mitigate FIL supply
shocks.
FILECOIN (FIL)
Filecoin is an open-source, cloud-based Decentralized
Storage Network (DSN) built to maximize data storage
and retrieval. The Filecoin network leverages a mining,
storage, and retrieval mechanism that connects
storage miners (providers) and retrieval miners
(servers) with clients who pay to store and retrieve
data. Network participants receive and send tokenized
rewards in the form of Filecoin coins (FIL) for
providing services on the network.
FINALITY RATE
Finality is a blockchain state (or status) that occurs
after a blockchain transaction has been confirmed and
can no longer be canceled, reversed, or altered by any
of the network participants. The finality rate is the
amount of time it takes to reach a finality state after a
transaction is executed. This rate can be measured in
seconds or blocks, depending on the blockchain in
question, as well as on the context in which this term
is applied.
FINANCIAL INCLUSION
Financial inclusion refers to the accessibility and
equality of financial services like banking, loans,
equity, and insurance services. Successful financial
inclusion is measured by the availability of affordable
and timely access to these types of services.
Financial Industry Regulatory Authority (FINRA)
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The Financial Industry Regulatory Authority (FINRA) is
a private corporation that acts as a self-regulatory
organization. It is responsible for writing rules
governing brokers and broker-dealer firms in the US.
Although it has regulatory powers, it is not officially
part of the US government, and exists as an
independent NGO. The Securities and Exchange
Commission (SEC) oversees FINRA.
FINANCIAL INFORMATION EXCHANGE (FIX)
The Financial Information eXchange (FIX) is a
communication protocol for the real-time exchange of
securities transaction information that provides direct
market access (DMA) data to financial service entities.
The FIX serves approximately 300 financial
institutions, including all major investment banks. It
has become the de-facto standard for pre-trade,
trade, and post-trade communications.
FINANCIAL SECURITIES
A security is a fungible investment instrument that is
offered with some kind of financial value. A security
can be a physical or digital asset, while examples
include stocks, bonds, and options. The defintion and
subsequent regulation of some cryptocurrencies as a
security is an emerging legilative factor in many
jurisdictions.
FINANCIAL TECHNOLOGY (FINTECH)
Financial technology (FinTech) is an emerging industry
that improves the existing structure of conventional
financial services by leveraging new technological
developments. FinTech generally aims to lower costs,
improve transaction times, remove minimum
thresholds, bolster financial inclusion, and offer more
flexible terms on financial products among other
initiatives. Blockchain and cryptocurrency can be
considered a category within the FinTech sphere.
FINITE-STATE MACHINE
A finite-state machine is a computational system that
can only exist in exactly one state — out of a finite
number of states — at any given time. Finite-state
machines operate by reading a series of inputs and
then switching to a new state, one that corresponds
with a function of its most recent input and current
state. All conventional computing devices are physical
representations of finite-state machines.
FINRA RULE 3310
FINRA Rule 3310 established minimum standards for
broker-dealers' Anti-Money Laundering (AML)
compliance programs. It requires firms to develop and
implement a written AML compliance program which
must then be approved by the FINRA. Firms must also
provide for annual (on a calendar-year basis)
independent testing for compliance to be conducted
by member personnel or by a qualified outside party.
FISCAL CRISIS
A fiscal crisis results when a state or government
experiences a deficit between its expenditures and
revenues. Fiscal crises tend to entail an economic
dimension as well as a political dimension. They are
often referred to as a budget deficit.
FISHERMEN
Fishermen is a technical term used within the
Polkadot blockchain protocol to refer to full nodes
that are responsible maintaining the integrity of the
network and nodes. The job of fishermen is to
monitor the Relay Chain and other parts of the
protocol to pinpoint and report unwanted behavior to
validator nodes. Rather than packaging state
transitions and producing the next parachain blocks
like Polkadot collators, fishermen monitor the process
to make sure that no invalid state transactions are
included. Fishermen typically stake a small amount of
DOT initially, and are rewarded upon identifying
unwanted behavior on the network.
FLASH LOANS
Flash loans are a type of DeFi loan that is rapidly
executed — borrowed and paid back in quick
succession — without the need for collateral. An
experimental technology offered by the Aave
platform, flash loans are made possible because of
how data is recorded on the Ethereum network. If the
principal and interest are not repaid within one
Ethereum transaction, the flash loan is effectively
reversed.
FLEXA
Flexa is a New York City-based company that manages
a blockchain-based payment network, the Flex
Network Protocol, which allows users to spend crypto
at brick and mortar retailers through its Spedn app.
The app generates a QR code at checkout, which
retailers scan to instantly receive their preferred fiat
for the transaction, while the equivalent amount of
crypto is deducted from users' wallets within the app.
Instant payments are made possible through the use
of the network’s native token AMP.
FOREX
Forex is a portmanteau that combines the terms
“foreign currency” and “exchange' that is used to
define the entire foreign currency exchange market.
The Forex currency trading market is a global and
largely over-the-counter (OTC) market that
determines currency foreign exchange rates and
facilitates all aspects of buying, selling, and
exchanging currencies at spot or agreed upon prices.
FORGING
Forging refers to the creation or minting of new blocks
in blockchain protocols using the Proof-of-Stake (PoS)
consensus algorithm. When a new block is forged,
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there is an opportunity to receive a reward from the
fees associated with each transaction included in the
block. Blocks are forged after the transactions are
validated and the block is signed. Different PoS
networks have varying rules regarding their respective
requirements to take part in the validation and forging
process.
FORK
A fork occurs when one blockchain is divided into two
blockchains. This type of split in a blockchain network
happens when an update is made to the blockchain
protocol, but not all of the network participant nodes
agree to adopt it. Blockchains can experience two
main types of forks: a soft fork or a hard fork. Soft
forks result in an update that is “backwards
compatible.” This means that nodes which accept the
update are still capable of interacting with nodes
which do not. In a hard fork, the update significantly
alters the original blockchain protocol such that the
two versions are no longer compatible with one
another. The result of a hard fork is two unique
blockchains that diverge after the hard fork event.
FORM 10-K
Form 10-K is a financial report that publicly traded
companies are required to file annually by the U.S.
Securities and Exchange Commission (SEC). The report
provides a comprehensive summary of a company's
financial performance over the course of the past
year.
FORM 10-K AND 10-Q
Form 10-Q is a financial report that publicly traded
companies are required to file quarterly by the U.S.
Securities and Exchange Commission (SEC). It contains
similar information to the annual 10-K form, although
generally less detailed and unaudited. Information
regarding the prior fiscal quarter is included in the
end-of-year 10-K form, so only three 10-Q forms are
required to be submitted for the year.
FORMAL VERIFICATION
Formal verification refers to mathematically proving
and verifying a smart contract to ensure that it will
function as intended. The use of mathematical
functions to build the software allows for the
mathematical verification of new code before it is
added. Formal verification is a cornerstone of
cryptography.
FRAUD PROOF
A fraud proof is a technical mechanism that operates
as a bond when employed in dApp ecosystems that
make use of Optimistic Roll-ups (ORs), which are
Ethereum sidechains that seek to decrease the fees
and latency dApps might experience on the Ethereum
platform. A sequencer, which is responsible for
processing ORs, must include a fraud prood along with
their work to incentivize good performance.
Sequencers are financially rewarded for processing
roll-ups according to consensus rules, and financially
punished by forfeiting their fraud proof when they
break them.
FUNCTIONAL PROGRAMMING LANGUAGES
Functional programming languages are programming
languages that employ mathematical functions to
determine the behavior of a program. They stand in
contrast to imperative programming languages, in
which software coding is executed as a set of stepwise
instructions. Some advantages of functional
programming languages include the mathematical
precision and verifiability of the code, as well as the
resulting security and speed.
FUND
A fund is a pool of money that is set aside for a
specific purpose and usually invested. Funds are often
managed by professional financiers. Common funds
include pension funds, insurance funds, foundations,
and endowments.
FUNGIBILITY
Fungibility is the attribute of being mutually
interchangeable. Fungibility occurs when a good,
asset, or units of an asset are indistinguishable from
each other, and so can be interchanged with each
other. For instance, one US dollar is equivalent to any
other US dollar, and is therefore fungible. Fungibility
makes an asset useful as a currency or payment
method.
FUTURES
Futures are derivative contracts for the purchase or
sale of a security or commodity at a future date and at
a preset price. The buyer has the obligation to buy the
underlying asset at the expiration date, while the
seller has the obligation to sell the underlying at the
expiration date. The value of the contract is based on
an agreed upon underlying trait of assets like
commodities, currencies, indexes, or stocks. Futures
contracts are traded on exchanges and they serve a
variety of purposes, from income generation to
hedging to speculation. There are a variety
cryptucrrency applications, including bitcoin futures,
which represent agreements to trade bitcoin at a
future date at a predetermined price.
GAS
The fees associated with transacting and executing
smart contracts on the Ethereum blockchain are
referred to as gas. Decentralized applications (dApps)
on the Ethereum blockchain run using smart contracts
that lay out rules for execution of events. The
execution of events happens through transactions,
which come with a cost to the network. These costs
are figured based on the computational power
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required for each action and how long each action
operates. Gas costs are denoted in gwei, a
denomination of ether (ETH), equal to 0.000000001
ETH. Gas was built into the system to allocate
resources to the network of miners who validate
transactions and create new blocks. Gas also acts as a
spam mitigation tool. By adding a cost to each
transaction, nefarious actors who might try to disrupt
the system by sending a large number of tiny
transactions are deterred from doing so.
GAS & NEO COINS
Not to be confused with the gas fees native to the
Ethereum network, GAS and NEO are the two native
cryptocurrencies of the NEO blockchain protocol. NEO
acts as the primary currency for transactions and gives
holders the right to vote on network proposals. Users
can also earn GAS through staking their NEO. GAS is
also used to pay for network usage: transaction fees,
storage fees, and fees associated with executing smart
contracts. All NEO coins were minted at the
establishment of the protocol, and GAS coins are
minted with every new block.
GENESIS BLOCK
A genesis block refers to the first block of any
blockchain network. It is almost always hardcoded
into the protocol software. It is the only block of a
blockchain network that does not reference a
previous block.
GITHUB
GitHub, a subsidiary of Microsoft, provides online
hosting services for collaborative software
development using Git, a distributed version-tracking
system. With a variety of advanced collaborative
tools, security features, and version control, GitHub
has become the de-facto standard for collaborative,
online software development. GitHub offers free
personal accounts in addition to enterprise accounts.
It is commonly used to host open-source projects,
although it offers private repositories as well.
GLOBAL INDUSTRY CLASSIFICATION STANDARD
(GICS)
The Global Industry Classification Standard (GICS) is a
financial taxonomy system that has been adopted by
most of the global financial system. It is an agreed-
upon “language” for understanding into which
industries and sectors certain companies are
categorized. The GICS structure consists of 11 sectors,
24 industry groups, 69 industries, and 158 sub-
industries. The GICS system classifies public
companies only.
GO
Go is an open-source computer programming
language designed by Google. Go is sometimes
referred to as 'Golang' because of its domain name
(golang.org). Go is a statically typed and compiled
programming language that is similar in syntactic
structure to C, but includes advanced features for
improved productivity when dealing with large
networks and codebases. Go has become a preferred
programming language for decentralized blockchain
networks, and is used with many dApps and other
decentralized tools.
GOLDEN CROSS
A golden cross is a bullish technical trading signal in
which the 50-day moving average crosses above the
200-day moving average, typically triggering a price
rally. It is the opposite of a death cross trading signal,
which is a bearish trading signal. Golden cross
formations can also be detected within shorter time
frames, such as the 5-day and 15-day averages,
although longer periods typically offer stronger
signals.
GOLEM (GNT)
Golem Network is a platform for democratizing access
to censorship-resistant computing power. It allows
users to supply and lease idle hardware in a peer-to-
peer manner. Golem currently operates as a
decentralized alternative to centralized cloud
computing solutions provided by Amazon, Microsoft,
and IBM. The settlement layer of the protocol allows
for the creation of a shared and alternative economy,
where users earn passive income by leasing their
hardware. The network is fueled by the Golem
Network Token (GLM), which was previously
identified by the ticker symbol GNT before a token
swap in November 2020.
GOVERNANCE TOKEN
A governance token provides holders with a degree of
influence over a platform's protocol, products, and
future functionality. Governance tokens are often
issued via decentralized protocols that aim to
encourage community-led growth and self-
sustainability. Holders of governance tokens are
typically able to propose changes to the protocol as
well as use their tokens to vote on those changes.
Governance tokens are used to democratically
manage a protocol in a fair and decentralized manner.
GRANDPA AND BABE CONSENSUS MECHANISMS
GRANDPA (GHOST-based Recursive Ancestor Deriving
Prefix Agreement) and BABE (Blind Assignment for
Blockchain Extension) are the two central components
of the hybrid consensus mechanism that Polkadot
utilizes to secure and maintain its network. BABE is a
mechanism for producing blocks while GRANDPA is
mechanism for finalizing the state of the blockchain.
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GRAPHICAL USER INTERFACE (GUI)
A Graphical User Interface (GUI) is a means of
interacting with a computer program in a visual way.
GUIs are intended to make computer programs easier
to use and employ icons, windows, and menus. GUIs
stand in contrast to text-based user interfaces which
require users to interact with computer programs
through text-based commands.
GREENLIST
The Greenlist is a list of cryptocurrencies provided by
the New York Department of Financial Services
(NYDFS). NYDFS-licensed virtual currency businesses
are permitted to use the coins on the list for approved
purposes.
GWEI
Gwei is the smallest unit of ether, the native
cryptocurrency of the Ethereum blockchain. 1 gwei is
equal to 0.000000001 ETH. Gas fees, which are fees
charged on every Ethereum transaction, are
denominated in Gwei.
HALVING
A halving is when the reward allocated to miners for
mining new blocks is reduced by 50%. Halving events
usually occur at fixed intervals. For example, Bitcoin's
block reward is halved every 210,000 blocks, and
happens about every four years.
HARD FORK
A hard fork is a software update that is not backwards
compatible. In the context of blockchain technology, a
hard fork happens when new rules have been
introduced into the blockchain code that are not
compatible with the rules of the blockchain's previous
code. If network nodes do not update their software,
they are unable to communicate with nodes that have
updated their software. This sometimes results in the
blockchain splitting into two networks — one which
operates with the old rules and one which operates
with the new, updated rules. For example, Bitcoin
Cash emerged after a hard fork of the Bitcoin
blockchain.
HARDWARE WALLET
A hardware wallet is a secure, physical, hardware
device which stores a user's private keys.
HASH
Hash functions are algorithms that take data of any
size and convert it into a fixed-length hexadecimal
number, or hash. Hash functions are one-way
functions and cannot be inverted to reveal the data
input to create the hash. The Bitcoin blockchain
utilizes the SHA-256 hash algorithm in its transaction
validation process.
HASH RATE
The hash rate is the unit of measure for the
computing power of a Proof-of-Work consensus
mechanism. The hash rate is valued in terahashes per
second (TH/s), and increases or decreases according
the the number of miners operating on the network.
HASKELL
Haskell is a programming language suitable for a
variety of applications in financial services and
hardware design. Cardano is programmed in Haskell.
HEDERA’S “GOSSIP”
"Gossip" is the protocol utilized by Hedera Hashgraph
to broadcast information amongst network nodes and
to reach consensus on transaction validation.
HEDGE
A hedge is when an investment in a security or asset is
made with the intention of offsetting potential risks or
losses elsewhere in an investment portfolio.
HIERARCHICAL-DETERMINISTIC (HD) WALLET
A hierarchical-deterministic wallet is a cryptocurrency
wallet that generates new cryptographic key pairs or
addresses from a master key pair each time funds are
received. This technique is intended to enhance the
privacy of the wallet by distributing the total balance
of a user's cryptocurrency holdings across several
addresses. This feature also increases the security of
the wallet by distributing private keys, while all
previously used addresses remain usable and within
the user's control.
HIGH-FREQUENCY TRADING
High-frequency trading is an automated market
trading method that utilizes algorithms to rapidly buy
and sell a large quantity of orders.
HIGH-NET-WORTH INDIVIDUAL (HNWI)
A high-net-worth individual (HNWI) is an individual
that possesses liquid assets above a certain amount,
generally at least $1 million. These assets could
include stocks, bonds, and commodities, among
others.
HIGH-YIELD (JUNK) BONDS
A junk bond is a bond that holds a high risk of default.
Junk bonds are also referred to as 'high-yield,' because
investors receive high interest rates in return for
taking on increased risk.
HODL
"Hodl" is a slang expression that refers to the holding
of cryptocurrency assets, as opposed to liquidation.
The term was derived from a post on Bitcointalk in
which the poster mispelled 'hold,' and subsequently
became a meme.
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HORIZONTAL SCALABILITY
Horizontal scalability is a means of increasing the
transactional capacity of a blockchain network by
adding more nodes to the network or optimizing
systems, rather than altering the protocol via code.
HOSTAGE BYTES
A hostage byte attack is a theoretical vulnerability in
the STORJ network in which malicious storage nodes
extort payment from users by refusing to transfer
pieces of data.
HOT (ONLINE) WALLET
The term hot wallet refers to a cryptocurrency wallet
that is connected to the internet. The wallet's assets
are therefore held online, as opposed to a cold wallet,
which is held in an offline environment.
HYBRID EXPONENTIAL MINTING
Hybrid exponential minting is a method for minting
coins utilized by the Filecoin network. In this model,
30% of rewards are distributed according to an
exponential decay model, in which block rewards are
greatest at the protocol's inception and decrease over
time. 70% of rewards are distributed in proportion
with the growth of the total storage capacity of the
network. This model was developed to ensure the
long-term viability of the Filecoin network because it
rewards miners throughout the entire lifecycle of the
network, in proportion to the utility they provide to
the network.
HYBRID NETWORK
A hybrid blockchain network combines elements of
both private and public blockchains. The hybrid aspect
of the network's architecture most often includes a
main public chain, in addition to private side-chains of
various purposes that link back to the main chain and
public access.
HYPERINFLATION
Hyperinflation describes severe, and often rapid price
increases in an economy resulting from surplus money
supply. Political instability, a weak economy, and loss
of confidence in the financial system can cause
hyperinflation, which can be highly destabilizing to a
national currency and economy.
ICON INCENTIVES SCORING SYSTEM (IISS)
The ICON Incentives Scoring System (IISS) is the
method used by ICON for measuring, incentivizing,
and rewarding contributions to the network. Examples
of contributions include running a node in ICON's
Delegated Proof-of-Stake (DPoS) network
architecture, or developing a decentralized application
(dApp). Rewards are denominated in the ICON
Exchange Token (ICX).
ICX
ICX, or the ICON Exchange Token, is the native asset of
the ICON blockchain. The token is minted each time a
block is created, and serves various purposes. As a
governance token, ICX holders can vote on changes to
the ICON blockchain. The ICX token is used as a
reward for nodes that maintain the network, to pay
for fees and smart contract usage, and as a medium of
exchange in the wider ICON ecosystem.
IMMUTABILITY
Immutability is the characteristic of data becoming
irreversibly codified in the shared data ledger of a
blockchain network after transaction execution. Most
non-blockchain computer networks are mutable,
meaning that the information inside them can be
modified, censored, or controlled by a central party.
Immutability allows a blockchain network to ensure
the overall trust and integrity of data for a dApp,
platform, or cryptocurrency.
IMPERMANENT LOSS
Impermanent loss occurs when the value of tokens
held in an algorithmically balanced liquidity pool lose
value relative to like assets in the open market due to
price volatility. The loss is 'impermanent' because the
original value of the tokens can be restored if the
liquidity pool restores balance.
INDEX
An index fund is an investment product made up of a
collection of investments designed to track an
industry segment of the financial market, or a basket
of investments accumulated for a particular stragery
or risk profile.
INDIVIDUAL RETIREMENT ACCOUNT (IRA)
In the U.S., many financial institutions offer individual
retirement accounts that provide tax advantages for
retirement savings. Anyone can sign up for an IRA and
save money in one. In short: one advantage of a
traditional IRA is that your contributions are tax-
deductible in the year that they are made.
INFLATION
Inflation refers to the gradual rising of prices in an
economy relative to actual value, which can decreases
the purchasing power of a currency if not managed.
Most cryptocurrencies follow a fixed inflationary
policy the decreases token circulation over time.
INITIAL COIN OFFERING (ICO)
Initial Coin Offerings or token sales are a fundraising
mechanism made possible by blockchain and
Ethereum that incorporates the creation and sale of a
token to raise funds for a project—usually a new
blockchain platform, decentralized application (Dapp),
or digital asset product. Instead of providing buyers
with equity or shares, an ICO sells tokens that usually
38
claim future utility in the products they are sold to
fund. Despite this, ICO-launched tokens may still be
considered securities, and are subject to jurisdictional
regulation.
INITIAL EXCHANGE OFFERING (IEO)
An IEO or Initial Exchange Offering is a token
distribution event that is specifically conducted on a
cryptocurrency exchange platform. Similar to Initial
Coin Offerings (ICOs), IEOs are a fundraising method
for many blockchain and crypto oriented companies,
but IEO's entail some aspect of the security,
compliance, and communications managed by the
exchange. IEO participants are able to purchase
tokens directly with exchange wallets, which removes
some of the technical knowledge required to
participate in ICOs.
INITIAL PUBLIC OFFERING (IPO)
An Initial Public Offering (IPO) is a sale of shares of a
private company to the public — particularly
institutional and retail investors. This process, which
takes place on a stock exchange, transforms the
private company into a publicly-traded company by
selling securities that represent an fraction of
ownership. Companies that intend to conduct an IPO
must adhere to rules and regulations as set out by the
US Securities and Exchange Commission (SEC).
INSIDER TRADING
Insider trading is an illegal activity in which a person
who has access to non-public, material information
about a company utilizes that information to make
advantageous trades of the company's stock.
INSTITUTIONAL-GRADE
The term institutional-grade generally refers to
infrastructures or products which have features that
make them suitable for use by large enterprises.
INSTITUTIONAL INVESTOR
Institutional investors are firms that invest in various
asset classes on behalf of other people. Examples of
institutional investors include pension funds, hedge
funds, and commercial banks among others.
INSTITUTIONAL TRADING SOFTWARE
Institutional trading software is software that provides
an online interface or exchange platform for
institutional trading and portfolio management.
INSURANCE
Insurance provides compensation for losses in
exchange for the payment of a fee, referred to as a
premium. Some digital asset exchanges have
insurance for the assets they hold in the event of theft
or other circumstances leading to losses.
INTER-BLOCKCHAIN COMMUNICATION (IBC)
PROTOCOL
The Inter-Blockchain Communication Protocol is a
protocol that facilitates interoperability between
different blockchain networks by enabling cross-chain
interaction and value exchange. It was designed by
technologists from Tendermint, Agoric, and Interchain
Foundation.
Interest Rate
Interest is the amount of money that a lender charges
for borrowing money. Interest rates are expressed as
a percentage of the amount lended and are typically
calculated on an annual basis known as the annual
percentage rate (APR).
INTERNET MEME
A meme is an image, video or piece of text, often
intended for humor, that is rapidly reproduced and
circulated by internet users through a variety of social
media platforms, often with minor changes over time
in engagement with wider meme culture.
INTERNET OF THINGS (IOT)
The Internet of Things (IoT) refers to physical objects
that are connected to the internet to enable features.
IoT devices include appliances, home media systems,
and security systems among a rapidly increasing list of
others. IoT products offer increased functionality,
share data, and interact with each other.
INTEROPERABILITY
In the context of the blockchain industry,
interoperability refers to the ability of different
blockchain protocols to interact and exchange value
with each other.
INTERPLANETARY FILE SYSTEM (IPFS)
The InterPlanetary File System (IPFS) is a network for
storing files and transferring verifiable data peer-to-
peer. Developed by Protocol Labs, the IPFS is
complementary to Filecoin, which is a blockchain
designed to incentivize persistent data storage. Both
protocols, while complementary, can be used
separately.
IN-THE-MONEY/ OUT-OF-THE-MONEY
In the money' refers to an option that has a market
price that is higher than its 'strike' price, which is the
set price at which the option owner can buy or sell the
security or commodity that underlies the option. 'Out
of the money' refers to an option that has a market
price lower than the strike price.
INTRINSIC VALUE
In finance, intrinsic value refers to an estimation of
the value of an asset or company that has been
calculated through financial modeling. The intrinsic
value of an asset is not always the same as its market
value.
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INVERSE SYNTHETIC CRYPTOCURRENCIES
Inverse synthetic cryptocurrencies are synthetic assets
offered on the Synthetix protocol that inversely track
the price of the cryptocurrency they represent, and
are represented with an 'i' prefix, as in the case of
iBTC. If the price of bitcoin increases, the price of iBTC
decreases.
INVISIBLE INTERNET PROJECT (I2P)
The Invisible Internet Project (I2P) is a distributed,
encrypted private network layer that exists on top of
the internet. I2P anonymizes user traffic on the
network and enables communication resistant to
censorship and third-party monitoring. I2P is
integrated with the privacy-centric Monero
cryptocurrency to optimize anonymity on the its
network.
IOTA
IOTA is a distributed ledger system that focuses on
transactions serving the Internet-of-Things (IoT). IOTA
utilizes a Tangle, which is a directed acyclic graph
(DAG) data structure instead of a blockchain for its
architecture. Its DAG structure places transaction
confirmation on IoT nodes tather than the block-
based system of blockchain. IOTA offers zero-fee
transactions and claims to high a high transaction
throughput.
ISSUER
An issuer is a legal entity, such as a corporation or
government that sells securities to investors to fund
its operations.
JAVA PROGRAMMING LANGUAGE
Java is a popular general purpose programming
language often utilized for client-server web
applications.
JAVASCRIPT (JS)
JavaScript (JS) is a popular programming language that
is used to create a variety of web applications.
JavaScript Object Notation (JSON) JavaScript Object
Notation (JSON) is a data interchange format and
open standard file format that utilizes human-
readable text to transmit and store data.
KEEP NETWORK (KEEP)
Keep Network provides a privacy layer for public
blockchains that enables users and apps to privately
transfer and store data in off-chain containers called
'keeps.' KEEP is the network's native token.
Participants can earn fees denominated in KEEP for
participating in the maintenance of keep containers.
KEEP TOKEN
KEEP is the native token of the Keep Network, a
protocol that allows public blockchain users and apps
to privately transfer and store data in off-chain
containers called 'keeps.' Users can stake KEEP tokens
to be randomly selected to earn fees by performing
services on the network such as encryption or data
storage.
Keosd
Keosd is a key manager daemon used within the
EOSIO blockchain system for storing private keys and
signing digital messages.
Key Management Interoperability Protocol (KMIP)
The Key Management Interoperability Protocol (KMIP)
facilitates the exchange of data between
cryptographic key management servers and clients. It
plays a key connective role in the function of crypto
wallets an other decentralized products. KMIP was
established by the Organization for the Advancement
of Structured Information Standards (OASIS), a
nonprofit consortium focused on the development
and adoption of open, global information-sharing
standards.
KEYS
A cryptographic key is a string of bits that is used by
an encryption algorithm to convert encrypted
ciphertext into plaintext and vice versa as part of a
paired key access mechanism. Keys are usually
randomly generated and, unlike a password, are not
intended to be memorized by users.
KNOW YOUR CUSTOMER (KYC)
Know Your Customer (KYC) is the compliance process
instituted by regulators for businesses to verify the
identity and level of risk of their customers. This
process normally requires users to provide official
identity verification using a passport, driver’s license,
or similar documents. KYC regulation requires
financial firms to collect personal data on their
customers and ensure the legitimacy of the person or
client to whom they may provide services.
KYBER NETWORK (KNC)
The Kyber Network is a blockchain protocol that
aggregates token liquidity from across the Ethereum
ecosystem and facilitates the exchange of tokens
without an intermediary.
LAST IRREVERSIBLE BLOCK (LIB)
Within the EOSIO protocol, the block confirmation
process is twofold. First, block producers propose
what's called an irreversible block with a record of
transactions. Then, if two-thirds of block producers
acknowledge the proposed block, it achieves
irreversible status and the transactions are considered
validated. The 'last irreversible block is the most
recent block to have been validated.
LATENCY
In trading, latency refers to the time elapsed between
the placement of an order and the execution of that
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order. High latency presents an undesirable delay
between actions, while low latency incurs minimal lag
that often amounting to just milliseconds. High
latency can signifcantly and negatively affect trading
strategies, particularly for dynamic assets, as market
prices may fluctuate in the time elapsed between
placement and execution.
LAYER-TWO SOLUTION
Layer-two solutions are protocols that integrate into
blockchains like Bitcoin and Ethereum as separate,
secondary layers built to increase transaction
throughput and reduce transaction costs. Examples of
layer-two solutions include Bitcoin's Lightning
Network and Ethereum's Plasma.
LEADER
On the Solana network, a leader is the transaction
validator that adds entries to the blockchain ledger.
To ensure equitability and decentralization, a 'leader
schedule' determines which validator becomes a
leader at a given time.
LEAKWARE OR DOXWARE
Doxware is a type of ransomware that first infects a
computer, then threatens to leak sensitive or
proprietary information held on the machine unless a
ransom is paid.
LEDGER
A ledger is a record-keeping system for tracking
financial transactions. Blockchains are often referred
to as distributed ledgers.
LEG
A leg is one element of a multi-step derivatives trading
strategy in which the trader combines several options
contracts, futures contracts, or a mixture of the two,
in order to profit from arbitrage or a spread, or to
hedge a trading position.
LEVERAGE
In the context of investing, leverage is the use of
borrowed money to fund an investment. If a position,
individual, or organization is 'highly leveraged,' it
means they are utilizing a large percentage of
borrowed money.
LIBRARY
In computer science, a library is a collection of
specialized resources that are utilized by computer
programs for software development. These resources
can include documentation, messaging templates,
configuration data, and pre-written code among other
things.
LIGHT-CLIENT NODE
A light client, or light node, is software that connects
to full nodes in a blockchain network. Unlike full
nodes, light nodes do not keep a full copy of the
blockchain, or communicate directly with the
blockchain. Instead, light clients rely on full nodes as
intermediaries. Light clients can be used to send some
transactions and to verify the balances of accounts,
but are significantly less functional than full nodes.
Lightning Network
The Lightning Network is a layer-two scaling
technology that operates on top of blockchains like
Bitcoin. It creates a private, two-way channel between
users that enables multiple transactions to take place
off the main blockchain. These transactions are
subsequently recorded as one single transaction on
the main blockchain. This process extrapolated over
many transactions reduces network congestion and
increase scalability.
LIMITED PURPOSE TRUST CHARTER
A limited purpose trust charter is a specialized license
issued by a U.S. state government which enables the
receiving company to perform a specific set of
functions, such as acting as a depositor or safekeeper
for specific types of securities. A company which
legally operates in accordance with the policies laid
out in a limited purpose trust charter is called a
"limited purpose trust company."
LIMIT ORDER
Common on exchange trading interfaces, a limit order
is a function to buy or sell an asset at a specific price.
When a trader sets a buy limit order, they typically set
the purchase of the asset to be executed lower than
current market price in anticipation of a downward
move towards a more favorable price. In contrast,
when a trader sets a sell limit order, it is typically set
higher than the current market price, in anticipation
of the asset going up in value. Specified limit orders
can remain unfilled if asset price does not behave in
the way anticipated by the trader. By contrast, market
orders are always filled at the current trading price of
a specified asset without a threshold limit price being
set.
LINK
LINK is an ERC-677 token that is the native token of
Chainlink's decentralized network of oracles. It is used
to reward node operators for providing external data
to smart contracts. Additionally, smart contract
creators can require nodes to deposit LINK as a
penalty fee to ensure that they fulfill requests for
external information.
LIQUIDITY AGGREGATOR
A liquidity aggregator accumulates liquidity from
centralized and decentralized sources into one
location to increase liquidity, reduce price slippage,
and facilitate more efficient trading activity —
particuary on decentralized exchanges (DEXs).
LIQUIDITY POOL
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A liquidity pool is a crowdsourced pool of
cryptocurrencies or tokens locked in a smart contract
that is used to facilitate trades between those assets
on a decentralized exchange.
LIQUIDITY PROVIDER (LP) TOKENS
Liquidity provider tokens (LP tokens) are created and
awared to a user that deposits assets into a liquidity
pool. LP tokens represent the share of the liquidity
pool that the liquidity provider owns. LP tokens are
ERC-20 tokens that can be transferred, exchanged,
and staked.
LIQUIDITY PROVIDERS
A liquidity provider is a user who deposits tokens into
a liquidity pool. In return for supplying liquidity, users
are typically awarded liquidity provider (LP) tokens
that represent the share of the liquidity pool user
owns.
Liquid/Liquidity
In regards to an asset, liquidity refers to the ability to
exchange an asset without substantially shifting its
price in the process, and the ease with which an asset
can be converted to cash. The easier it is to convert
the asset to cash, the more liquid the asset. With
regard to markets, liquidity refers to the amount of
trading activity in a market. The higher the trading
volume in the market, the more liquid the market.
Liquid markets tend to increase the liquidity of assets.
Liquid Markets
A market that is liquid has a large number of buyers
and sellers, and low transaction costs.
Liquid Proof of Stake
Liquid Proof of Stake (LPoS) is a consensus mechanism
modeled after the concept of liquid democracy. Liquid
democracy is a system that allows individuals to both
vote directly on issues, or to elect delegates to vote
on their behalf. Delegates can also transfer the voting
responsibilities given to them to another delegate—a
process which is referred to as transitivity. If the
individual who delegated their vote does not agree
with the way their delegate voted, the individual can
rescind their vote and vote directly. In LPoS systems,
users stake their tokens to earn the right to
participate in the blockchain's consensus process, and
participate either directly or via a delegate.
Litecoin (LTC)
Litecoin (LTC) is a cryptocurrency that was introduced
in 2011 by Charlie Lee. Litecoin was created by forking
Bitcoin's code and retains many characteristics of
Bitcoin, while being optimized for lower cost
transactions. It is considered to be the first altcoin,
and was the second cryptocurrency to be widely
accomodated on digital currency exchanges and
accepted in the wider economy.
Locker Ransomware
Locker Ransomware is a type of ransomware that
locks victims out of their devices until a ransom fee is
paid.
Locky Ransomware
Locky ransomware is a type of ransomware that
emerged in 2016 that spread through phishing emails
and locked victims out of their devices until they paid
a ransom.
London Bullion Market Association (LBMA)
The London Bullion Market Association (LBMA) is an
international trade association that represents the
world's Over-the-Counter (OTC) gold bullion market.
The LBMA has over 150 member firms which trade,
refine, produce, buy, sell, store, and transport
precious metals.
London Good Delivery
Set by the London Bullion Market Association (LBMA),
the London Good Delivery is a specification of the
required attributes of the gold and silver that is used
for settlement in the London Bullion Market. The
specification also defines the ways in which gold and
silver bars should be weighed; packed, and delivered,
while also delineates requirement and standards for
approved refineries.
LOOM (LOOM)
Loom is an Ethereum-based platform that was initially
focused on providing scalability for decentralized
applications. It later pivoted to focus on enterprise
blockchain applications for industries such as
healthcare.
LUMP SUM
A lump sum is an amount of capital that pays an
outstanding fee in one installment.
MACHINE LEARNING (ML)
Machine Learning (ML) is a subset of artificial
intelligence (AI) and is the study of algorithms which
optimize through experience without being
programmed to do so. Machine learning algorithms
find patterns in large data sets in order to make data-
based claims and predictions.
MACHINE LEARNING PREDICTION
A machine learning (ML) prediction is the result of a
machine learning algorithm analyzing a historical data
set. The ML prediction can then subsequently be
applied to new data sets, where it can be used to
forecast outcomes like the future price movement of
a stock.
MACHINE-TO-MACHINE (M2M)
The term machine-to-machine (or M2M) refers to
communication between devices that occurs without
human input. In the blockchain industry, this
frequently relates to automated payments facilitated
through smart contracts. Automation eliminates the
role of gatekepers or intermediaris, which significantly
reduces costs.
MAINNET
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A mainnet is a fully developed and released version of
a blockchain network. This stands in contrast with a
testnet, which is generally used to perform tests and
experiments on a blockchain either before a mainnet
is released. Testnets are used while a blockchain is live
for experimentation and development as to not
distrupt the main chain.
MAKER (MKR)
Maker (MKR) is the governance token of MakerDAO,
an Ethereum-based protocol that issues the Dai
stablecoin and facilitates collateral-backed loans
without an intermediary. MKR is a governance token
that allows holders to vote on changes to the
protocol, like the addition of new collateral assets and
protocol updates.
Maker Protocol
MakerDAO is the Ethereum-based protocol that issues
Dai, a stablecoin that tracks the value of the US dollar.
MakerDAO also facilitates collateral-backed loans
without an intermediary. The platform is governed by
the holders of its native Maker (MKR) tokens.
Malware
Malware refers to any type of 'malicious software,'
software that is specifically designed to cause damage
to computers and computer systems. Examples of
malware include viruses, trojan horses, and
ransomware among others.
Margin Call
A margin call occurs when the value of an investor's
margin account—a type of account that lets investors
purchase securities with borrowed money—falls
below the broker's required mininum amount.
Specifically, a margin call is a broker's demand that an
investor deposit additional money or securities into
the account to restore it to the minimum value or face
liquidation.
Margin Trading
Margin trading refers to leveraging borrowed funds to
trade an asset.
Market Capitalization
In the blockchain industry, market capitalization, or
market cap, refers to the value of the entire supply of
a cryptocurrency or token. Market capitalization is
calculated by taking the market price of one coin or
token and multiplying it by the total number of coins
or tokens in circulation.
Market Maker
In finance, a market maker is a company or individual
that buys and sells large amounts of an asset in order
to ensure that the market for that asset remains
liquid. In the 0x protocol, a market maker is a special
category of trader who makes it possible to have
liquidity, tight spreads between the bid and ask prices
for the assets being traded, and low slippage.
Market Order
The most common type of trade made by retail
investors, a market order is used to purchase or sell
an asset at the current market price. Market orders
are the fastest and most efficient way to purchase an
asset when trading, and are typically filled
instantaneously when strong liquidity and trading
volume is present. Market orders are placed within an
online order book on an exchange trading interface,
usually either on a computer or mobile device.
Market Signal
A market signal, also known as a trading signal, is an
indication to buy or sell assets that is based on some
form of technical or fundamental analysis. Traders can
generate market signals using a variety of criteria,
such as earnings reports, trade volume analysis, or
through myriad technical indicators based on market
metrics.
MARK-TO-MARKET
Mark-to-market, also known as fair value accounting
or marked-to-market, is an accounting practice that
values assets in terms of current market price, as
opposed to a static book value.
Medium of Exchange
A medium of exchange is an asset that is widely
accepted in exchange for goods and services. Fiat
currency is an example of a medium of exchange
today, but historically has included everything from
shells to precious metals.
Memorandum of Understanding (MOU)
A Memorandum of Understanding (MOU) is a
document that outlines an agreement reached
between two or more parties. MOUs are not legally
binding, but often indicate that the parties will likely
sign a binding contract in the future.
Merkle Tree
A Merkel Tree is a data structure composed of data-
converting hashes that is utilized by blockchains for
the secure verification of information. A Merkle tree
summarizes all the transactions in a block by
producing a digital fingerprint (i.e., a single hash) of
the entire set of transactions.
Metadata
Metadata is a form of data that is made up of other
data. For example, the metadata of a file might
describe when the file was created and what type of
file it is.
MetaMask
Metamask is a web browser-based blockchain wallet
that allows users to connect to Ethereum
decentralized applications (dApps) without running an
Ethereum full node. Metamask is also used to
integrate to numerous decentralized exchange (DEX)
platforms like Uniswap. Currently (December 2020) a
mobile-based version of Metamask is undergoing
extensive development and will be fully launched in
2021.
Metaverse
A metaverse is a shared virtual reality world.
Micropayment
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A micropayment is a transaction, typically online, that
involves a small sum of money—sometimes as small
as a fraction of a cent.
Mimblewimble
Mimblewimble is a privacy-focused blockchain design
first proposed in 2019 by the pseudonymous Tom
Elvis Jedusor. Mimblewimble's novel design proposes
a way to maintain transaction data privacy while
executing transaction verification that does not
require network nodes to store the entire history of
the blockchain. Grin and Beam are open source
implementations of Mimblewimble tech.
Miner
Miners are an essential component of every Proof-of-
Work (PoW) blockchain consensus protocol, and are
responsible for validating new transactions and
recording them on the blockchain ledger. Miners
validate these transactions by solving complex math
problems, which results in the minting of new tokens
while reinforcing the network's security and
trustworthiness. In order to incentivize users to
allocate processing power to mine new blocks, miners
are typically rewarded a fraction of a network's native
currency with every successfully mined block.
Minimum Viable Product (MVP)
A Minimum Viable Product (MVP) is an early version
of a product that has enough features such that a
company is able to trial the product and collect data
on how customers or clients may use it.
Mining
Mining is the process of using computing power to
verify and record blockchain transactions. Mining also
results in the creation of new coins, which miners
earn as a reward for their efforts. Mining is utilized in
Proof-of-Work (PoW) blockchains.
Mining Pool
A mining pool is a group of miners who combine their
individual computing power in order to increase their
chances of successfully mining a block of transactions.
When successful, block rewards are split amongst the
members of the mining pool.
Mining Rewards
Mining rewards, also referred to as block rewards, are
native assets of a network that miners receive for
successfully mining blocks of transactions. Mining
rewards can vary over time. Bitcoin's block rewards,
for example, decrease by 50% every 210,000 blocks.
Mining Rig
A mining rig is a system used to mine cryptocurrency
tokens. This rig can either be a device that is
specifically designed and built for mining, or a
personal computer that is only used to mine
cryptocurrency on a part-time basis.
Mobile Wallet
A mobile wallet is a cryptocurrency wallet that is
installed on a smartphone. Mobile wallets are typically
'hot' wallets, meaning they are connected to the
internet.
Monero (XMR)
Monero is a privacy-focused Proof-of-Work blockchain
that was created in 2014. Its privacy features include
anonymizing transaction amounts and the addresses
of transacting parties. Its native asset is XMR.
Monetary Authority of Singapore (MAS)
The Monetary Authority of Singapore (MAS) is the
central bank and main financial regulatory authority of
Singapore. The MAS is responsible for ensuring the
regulatory compliance, stability, and efficiency of the
Singapore’s economic system pertaining to banking,
investment, monetary policy, insurance, securities,
and the financial sector in general — as well as for the
issuance of the Singapore dollar (SGD).
Moore’s Law
Moore's Law is an assertion made by Gordon Moore
in 1965 stating that due to technological advances in
microchips, the power and speed of computers would
double every two years, along with a correlational
decrease in cost.
More Viable Plasma
More Viable Plasma (MoreVP) is a variation of Plasma,
a layer-two Ethereum scaling technology introduced
by Vitalik Buterin and Joseph Poon. MoreVP bundles
transactions together and verifies them off of the
blockchain before returning them in a batch to be
verified by Ethereum. OMG Network utilizes MoreVP.
Moving Average Convergence Divergence (MACD)
The moving average convergence divergence (MACD)
is a trading indicator used in technical analysis that
utilizes moving averages to analyze the momentum of
an asset.
Moving Averages
A moving average is a stock indicator used in technical
analysis to determine the support and resistance
levels of an asset, as well as the trend direction of an
asset's price. Moving averages are calculated based on
past prices, and is thus considered a 'lagging'
indicator.
Mt. Gox
Mt. Gox was a centralized cryptocurrency exchange
that lost more than 700,000 bitcoin in a 2014 hack.
Created by Jed McCaleb in 2010, Mt. Gox was sold to
Mark Karpeles in 2011 who operated it from Japan.
Mt.Gox filed for bankruptcy and liquidation
proceedings after the 2014 hack. Creditors are still
awaiting compensation for their lost funds.
Multifactor Authentication
Multifactor authentication is a security mechanism
that requires users to provide more than one form of
verification when logging into systems. For example,
when logging into an email account, a user may be
required to enter both a password and a verification
code sent to their smartphone.
Multi-Hop Routing
In the context of the Orchid protocol, 'hops' refer to
the way data is routed, specifically the encryption and
masking of web traffic by a virtual private network
(VPN). Multi-hop routing refers to the routing of
traffic through multiple VPNs.
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Multi-Signature (Multi-Sig) Wallet
A multisignature (multisig) wallet is a wallet which
requires multiple keys to sign a transaction before it
can be executed. Non-multisig wallets require only
one signature to authorize transactions.
Mutual Insurance Company
A mutual insurance company is an insurance company
that is entirely owned by its members. The primary
objective of a mutual insurance company is to provide
coverage for its members, who also play infuential
role in company governance.
Mutualized Proof of Stake (MPoS)
Mutualized Proof of Stake (MPoS) is a consensus
mechanism that is used by the Qtum blockchain.
Unlike Proof of Stake, MPoS divides each block reward
between the block producer and the nine previous
block producers. A block's producer receives 10% of
the block reward immediately, and the remaining 90%
is distributed after waiting for 500 blocks. This is done
to disincentivize malicious attacks on the network.
My Story™
My Story™ is a blockchain-based digital assurance
solution created by VeChain and DNV GL. My Story™
enables consumers to scan a QR code on a product to
learn about the product's lifecycle and information
related to quality, social, environmental and ethical
issues.
N
Near-Field Communication (NFC)
Near-Field Communication (NFC) is a protocol that
enables devices to communicate wirelessly when they
are no more than 4cm apart. NFC devices can be used
as keycards and to facilitate contactless payments.
VeChain utlizes NFC to track products in supply chains.
NEM Foundation
The NEM Foundation was established in Singapore in
2016 to promote the growth of the NEM ecosystem.
The foundation markets NEM technology and pursues
projects in support of its development.
NEM N1S1
NEM N1S1 is the official name of the original NEM
blockhain protocol. NEM plans to release Symbol, a
new and separate blockchain protocol intended to
build upon the strengths of the original NEM chain
while incorporating new features. The two
blockchains will not be compatible.
NET
NET is the amount of network bandwith a user is
allowed to utilize on the EOS network. NET is
calculated in bytes of transactions, and users must
stake EOS tokens to use it.
Network Baseline Model
The Network Baseline Model is Filecoin's schedule for
minting tokens, which is tied to growth in the
protocol's storage capacity. While tokens are only
minted via block rewards, 70% of rewards are
distributed in proportion with the growth of the total
storage capacity of the network. The remaining 30%
of rewards are distributed according to an exponential
decay model, in which block rewards are greatest at
the protocol's inception and diminish over time.
Network Congestion
Network congestion occurs when the speed or quality
of a network's service is reduced due to an
overwhelming volume of transactions. Congestion can
occur when a network experiences an unusual spike in
activity that surpasses the volume the network was
designed to handle, or in the event of certain
malicious attacks such as a Distributed Denial-of-
Service (DDoS) attack.
New York Stock Exchange (NYSE)
The New York Stock Exchange (NYSE) is an American
stock exchange. It is the world's largest stock
exchange by market capitalization of listed
companies.
Nifty Gateway
Nifty Gateway is a platform that provides users with
an easy way to buy, exchange, and manage non-
fungible tokens (NFTs). The platform offers a broad
array of digital art and collectible NFTs, and provides a
fiat onramp, therefore enabling users to obtain NFTs
with fiat as well as cryptocurrencies. Gemini acquired
Nifty Gateway in November 2019.
Node
In blockchain tech, a node is a computer that is
connected to a blockchain network that serves a
number of purposes essential to the maintenance of a
distributed system. Some nodes validate transactions,
while others observe activity on the blockchain. Nodal
network structure is also a key aspect of maintaining
security on a blockchain network.
Nodeos Core
Nodeos is the core service daemon that runs in the
background of every EOSIO node on the EOS network.
A nodeos can be utilized to validate transactions,
process smart contracts, produce and confirm blocks,
and to record transactions onto the EOS blockchain
network protocol.
Nominated Proof of Stake (NPoS)
Nominated Proof of Stake (NPoS) is a variation of the
Proof-of-Stake (PoS) consensus mechanism employed
by the Polkadot blockchain network's main Relay
Chain and Polkadot-based parachains (independent
blockchains or specialized shards). Instead of using the
traditional PoS methodology, NPoS is used to select
validators through Polkadot network nominators.
Nominators typically only choose validator nodes they
trust but they can lose DOT, Polkadot's native
cryptocurrency, if they choose malicious validator
nodes through a process called slashing.
Nominators
Nominators are nodes that are used to secure
Polkadot’s main Relay Chain by selecting trustworthy
validator nodes and staking DOT, Polkadot's native
cryptocurrency. In this process nominators
algorithmically choose network validators by bonding
their DOT assets to produce blocks on the Polkadot
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network and in exchange receive a portion of
validator node rewards. However, nominators are also
susceptible to slashing (losing some of their DOT) if
the validator nodes they select behave in a malicious
manner.
Nonce
A nonce (which stands for "number only used once")
is a number that is added to all the data in a block
prior to the hashing of that block in the Proof-of-Work
mining process.
Non-Custodial
Non-custodial and custodial are classifications that are
used to classify the services that a financial institution
provides to their customers to manage securities or
other assets, including crypto. In the blockchain
industry, non-custodial means that the user has full
control over their crypto and is required to manage
their own private keys (specialized algorithmic
passwords needed to generate transactions and
manage assets). This typically means that no external
entity is responsible for the management, insurance,
and transaction of the assets held.
Non-Custodial Wallet
Non-custodial wallets are cryptocurrency wallets that
are controlled only by the person who created the
wallet, meaning, the creator of the wallet has full
control of their private keys (a specialized algorithmic
password used to effect crypto transactions).
Non-Deterministic (ND) Wallet
A Non-Deterministic (ND) wallet is a type of non-
custodial cryptocurrency wallet that is made to
generate, store, and manage numerous private keys
that are independent from each other. Non-
Deterministic wallets often store their private keys in
pairs (because they utilize randomness) and were
developed shortly after the Bitcoin blockchain
network went live for the first time. The main problem
with Non-Deterministic (ND) wallets is that their
backup keys must be created each time a new wallet
is created, This problem was later mitigated by wallets
that made use of BIP 32 technology (a deterministic
key generator).
Non-Fungibility
Non-fungibility means that a specific asset is
distinguishable or unique from another asset that is
similar in nature. A non-fungible token (NFT) is a
specialized type of cryptographic token that operates
within a blockchain platform and is not
interchangeable with any related asset. NFT’s are
typically indivisible and cannot be divided or altered in
any way.
Non-Fungible Token (NFT)
A non-fungible token (NFT) is a specialized type of
cryptographic token that represents a unique digital
asset that cannot be exchanged for another type of
digital asset. This characteristic is in contrast to
cryptocurrencies and blockchain utility tokens (like
Bitcoin and Ethereum) that are fungible in nature.
NFT's are created via smart contract technology and
are classified within the ERC-721 token standard.
Notional Volume
Notional volume is a distinct measurement of trading
volume in a particular time frame and is often
considered in context with market value, which is the
current price of a security that can be purchased or
sold through a brokerage or exchange service. As an
example, let's say a call option representing 100
shares of a specific stock with a strike price of $30
may actually trade on the market for $1.50 per
contract (100 x $1.50 = $150 market value) but its
notional value is $3,000 (100 x $30). This as an
example of the classification of notional volume.
Numeraire (NMR)
Numeraire is a blockchain-based protocol that was
designed to be an algorithmic institutional trading
platform. Numeraire utilizes a crowdsourced
predictive-trading analysis platform to host weekly
trading competitions and is designed to allow users to
make better trading and investment decisions. The
project’s underlying cryptographic asset NMR
contributes to the widescale implementation of the
Numeraire blockchain ecosystem.
O governance also takes into consideration the global
Off-Chain
Off-chain is a classification that refers to any type of
transaction or mechanism (including governance,
tokenized asset creation, consensus design etc.) that
occurs outside of a blockchain network protocol. An
off-chain mechanism is typically executed outside of
the actual blockchain network through other
mechanisms that compliment on-chain
methodologies. For example, voting by a governnce
council or a steering committee to determine the
governance structure of a blockchain ecosystem and
its underlying protocol is conducted off-chain.
Off-Chain Governance
Off-chain governance is a blockchain-based
mechanism that generally takes place externally to
the underlying blockchain network protocol, typically
in a face-to face fashion by several interrelated
parties. This procedure often refers to a means of
establishing rules for the on-chain protocol and
overall blockchain ecosystem, oftentimes through a
voting process by different constituents working to
determine the overall direction of the project. Off-
chain governance also takes into consideration the
underlying global blockchain community and several
on-chain parameters to realize a stronger overall
governance system. Blockchain governance evolves
and changes over time with the goal of improving the
system as time goes on.
OMG
The OMG Network (previously known as OmiseGo) is
a non-custodial, layer-2 scaling solution that is built to
compliment the Ethereum network by drastically
decreasing transaction times and increasing overall
46
network scalability. This is realized by enhancing
Ethereum’s ability to send and receive the Ethereum
network’s underlying asset (ETH) and Ethereum-based
ERC-20 tokenized assets. OMG Network makes use of
a specialized layer-2 scaling technology called More
Viable Plasma (MoreVP) to make this functionality
possible. As well, the OMG Network leverages the
network’s utility asset (OMG) to drive the blockchain
platform and its overall ecosystem.
On-Chain
On-chain is a classification that refers to any type of
transaction or mechanism (including governance,
tokenized asset creation, consensus design etc.) that
occurs within a blockchain network protocol. An on-
chain mechanism is typically executed automatically
through the use of cryptographic and algorithmic
computerized code underlying blockchain platform.
On-Chain Governance
On-chain governance is a blockchain-based
mechanism that takes place inside the computational
architecture of a blockchain network protocol. This
procedure often refers to a means of establishing
rules for the on-chain aspects of the protocol and the
overall blockchain ecosystem, typically through the
use of automatic cryptographic algorithms. On-chain
blockchain community and several off-chain
parameters to realize a stronger overall governance
structure. Both on-chain and off-chain governance
systems work together to improve the blockchain
ecosystem (and its underlying protocol) as it matures
over time.
Ontology Trust Anchors
Ontology Trust Anchors are qualified third-party
trustors which provide authentication services on the
Ontology blockchain by using a three-tiered
mechanism. This structure includes: (1) “verifiers” that
verify and make use of trust from the (2) “trustee”
which is entrusted by the (3) trustor (or trust anchor).
Each of the three processes work together to verify
data cryptographically and algorithmically in a
transparent manner on the Ontology blockchain.
Examples of trust anchors can be government
agencies, universities, banks, third-party
authentication service providers, or biometric
technology companies, and constitute a portion of
Ontology’s multifaceted trust network — much of
which consists of decentralized multi-source
authentication protocols.
Ontorand Consensus Engine
The Ontology blockchain protocol makes use of the
OCE (Ontorand Consensus Engine) consensus
mechanism. OCE is an upgraded version of the
standardized Delegated Byzantine Fault Tolerance
(dBFT) consensus protocol that also makes use of
Verifiable Random Function (VRF) and Proof-of-Stake
technology. OCE is based on Onchain’s Distributed
Networks Architecture (DNA) which was designed by
the creators of NEO. OCE can theoretically achieve
near-infinite scalability and requires a relatively low
hashing rate, with block-creation speeds limited only
by a user’s internet speed.
Open Finance
Open finance refers to the integration of bank and
third-party blockchain-based technological
applications that are designed to transform the
traditional finance sector. Open finance aims to
enable financial institutions, large enterprises, and
central banks to conduct their business practices in a
more transparent, efficient, automated, and data-
driven manner. There are three main parameters that
must be implemented to facilitate the creation of a
resilient and transparent open finance ecosystem.
Firstly, to establish a settlement layer consisting of
different stable coins; second, to onboard enterprises
and construct a data layer to help enable the
technology; and lastly, to allow financial institutions to
create financial products using trusted enterprise
data.
Optimistic Roll-Up (OR)
An Optimistic Rollup (OR) is a type of roll-up (roll-ups
are a specialized blockchain-based settlement process
that makes use of smart contracts off-chain) used to
lower transaction fees on a blockchain network that
processes dApp transactions off-chain before settling
the final state on-chain. A sequencer (also called an
aggregator) utilizes a fraud proof (essentially a bond)
to ensure that the roll-up is processing according to
the correct parameters. For this reason, ORs are
considered “optimistic,” because they expect
sequencers to act in an ethical manner. The fallback
mechanism used in this process is the fraud proof,
which is used to financially disincentivize malicious
actors.
Options Contract
An options contract is a derivatives contract that
facilitates an agreement between two parties to carry
out a potential transaction for an underlying security
at a predetermined price (referred to as the strike
price) on or prior to the expiry date of the contract.
Options contracts are typically categorized into either
a put option or a call option, both of which are bought
to speculate on the direction of a stock or stock
indices, or sold to generate income. Typically, a call
option is purchased as a leveraged bet on the
potential appreciation of a stock or index, while a put
option is purchased to potentially profit from future
price declines.
Oracle
Oracles are third-party information service providers
that send external real-world data to a blockchain
protocol (often to a smart contract or numerous smart
contracts). Oracles give blockchain network protocol’s
significantly more power because they are able to
exponentially secure, verify, and strengthen the
validity of data that a blockchain network receives and
makes use of (because blockchains and smart
contracts are often closed systems). Oracles can be
47
decentralized and rely on numerous data sets, or
centralized and controlled by a single entity.
Currently, one of the main uses of blockchain-based
oracles is to provide price and data feeds needed for
the trustless execution of smart contracts used by
financial mechanisms in the DeFi sector.
Orchid Blockchain Protocol
Orchid is a peer-to-peer marketplace for virtual
private networking (VPN) providers and users that
allows any user of the network to purchase bandwidth
(off-chain and without gas fees and the congestion of
the Ethereum network) from a participating VPN
service provider. The Orchid network utilizes a
payment mechanism called a probabilistic
nanopayment for users to purchase bandwidth by
paying in Orchid’s native utility token (OXT).
Order and Execution Management System (OEMS)
Caspian’s Order and Execution Management System
(OEMS) is a software platform, exchange aggregator,
and suite of tools for advanced trading and portfolio
management designed for institutional investors.
Order Book
An order book is an electronic list of buy and sell
orders for a specific security, asset, or financial
instrument (or in the blockchain industry, a specific
cryptocurrency asset) organized by price level. Order
books are typically accessed through an exchange
service provider's online interface — such as a
computer or mobile device — and help traders and
investors improve market transparency by providing
critical trading and investment data. An order book is
composed of the number of shares or financial assets
(or tokens) being bought and sold at specific prices in
a sequential order (with the green portion of the
interface being the buy list, and the red portion, the
sell list).
Order Slicing
Order slicing is a strategy used by institutional
investors with large amounts of capital to make large
purchases or trades (generally via an order book and
online exchange interface) of a specific asset in
smaller, more spaced out increments. Order slicing is
done to prevent huge price fluctuations in the market
and to maintain privacy. Order slicing is also used to
gain a better overall average entry price, and to
protect investment capital.
Orphaned Blocks
Orphaned blocks (generally referred to as stale blocks)
are blocks that have not been accepted within a
blockchain network due to the lag time when two
blocks are mined simultaneously. Theoretically, a soft
fork is created when two blocks are mined at the
same time, but this is only a practicality because
orphaned blocks typically only create four blocks in a
row outside of the main network they originated
from. Orphaned blocks are valid and verified blocks
that exist in isolation form the initial blockchain and
serve no purpose after they are rejected.
Ouroboros Praos
Ouroboros Praos is a Proof-of-Stake consensus
mechanism designed by the IOHK team building the
Cardano blockchain. Its novel approach provides
security against fully-adaptive corruption in a semi-
synchronous setting. A malicious actor is able to
corrupt any participant from an evolving population of
stakeholders at any time provided that stakeholder
distribution keeps an honest majority of stake — and
this approach helps safeguard against such concerns.
Ouroboros Praos is considered a highly scalable,
innovative, and a secure methodology to construct a
Proof-of-Stake blockchain-based system.
Over-Optimization
Over-optimization is a process that occurs when
traders create a trading algorithm (often using
excessive curve-fitting) on a computerized system that
looks great in theory but when it is actually used in a
real-time market trading scenario does not perform as
desired. This occurs when the algorithmic trading
system is too complex for the computer too handle
and results in an overloaded computational system.
Over the Counter (OTC) Trading
Over-the-Counter (OTC) trading is typically a process
where an agreement to purchase a specific asset is
completed between two parties without the need for
a centralized exchange. OTC desks are usually used to
purchase large quantities of an asset in order to
improve transparency, save time and fees, and to
maintain security of the asset purchased. Usually OTC
trading involves a third-party custody solution. Also,
OTC desks often trade assets or securities that are
unlisted on regular crypto exchanges, because smaller
exchanges do not meet the regulatory requirements
to list the specific asset.
OXT
OXT is Orchid’s native utility crypto asset that helps
facilitate Orchid’s VPN-based blockchain network
infrastructure and community. The Orchid network
utilizes a payment mechanism called a probabilistic
nanopayment for users to purchase bandwidth by
paying in OXT. OXT is also used by VPN providers to
stake to the Orchid network. Orchid is a peer-to-peer
marketplace for virtual private networking (VPN)
providers and users that allows any user of the
network to purchase bandwidth from a participating
VPN service provider.
P payment’s are processed via Stellar’s decentralized
Paper Wallet
A paper wallet is an offline method (a piece of paper)
that includes a user’s private key, public key, and
wallet address that are used to store and transact
cryptocurrencies (when connected online to an
exchange or blockchain node). Paper wallets were
primarily used around the time Bitcoin was first
created but presently they are quite rare and have
been replaced by more efficient hardware and
software wallets.
Parachain
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Parachains are Polkadot-based independent
blockchains that connect to and run off of the
Polkadot network’s main Relay Chain. Parachains can
also be considered shards (with entire blockchains
inside them). Parachains run in parallel to the Relay
Chan and process transactions through parallelization
by using sharding and exhibit extremely fast
transaction times. Parachains are able to host their
own blockchain-based tokenized assets within their
independent network and control their own
governance processes by paying to use a parachain
slot by attaching to the main Relay Chain.
Passive Yield
Passive yield is any type of income that is generated
from an investment; however this term usually refers
to investments that are held on a medium to long-
term basis. Specifically in relation to blockchain
technology and crypto investing, a passive yield is
typically realized when an investor purchases a
cryptocurrency with a specific amount of investment
capital (for example, by buying ETH or BTC with a fiat
currency like the U.S. dollar) and earns interest on
that crypto over time.
Passphrase
A passphrase is a specialized type of password which
is structured as a specificially ordered sequence of
words, which is used to access a particular account,
device or system. Since passphrases are typically
composed of individual coherent words rather than an
abstract string of letters, numbersm and symbols,
they are often easier to remember than random
passwords, although passphrases offer a similar—and
at times even higher—level of security when properly
applied. Within the blockchain industry, passphrases
are commonly used as a security mechanism which
helps users protect their cryptocurrency assets by
mitigating the risk of an account hack and/or
unauthorized third-party access.
Password Manager
A password manager is an online program that stores
and manages a user's passwords. It can also generate
and retrieve complex passwords.
Path Payment
Within the Stellar blockchain’s technical framework, a
path payment refers to a payment that is sent in one
currency and received in another (for example a
payment sent in USD and received in EUR). Path
exchange (DEX), are atomic in nature, and are
processed as a single transaction to mitigate the risk
of the end user receiving a type of asset that they do
no not want. Remember, a path is a specialized type
of trade, or chain of trades, that exists on Stellar’s
SDEX order book (an order book is a list of buy and sell
orders for a particular asset).
Pattern Day Trading
A pattern day trader (PDT) is a regulatory classification
for a trader who executes more than four margin
trades per day during five consecutive business days.
The PDT designation places specific limits (to limit
excessive risk and detrimental habit-based trading) on
trading for a trader and can result in an exchange
banning a trader for up to 90 days in order to remain
compliant with NYSE (New York Stock Exchange)
regulations.
PAX Gold (PAXG)
PAX Gold (PAXG) is an ERC-20 stablecoin created to
help investors maintain the benefits of purchasing
gold without the drawbacks of the traditional gold
investment process. Each PAX Gold asset is pegged on
a 1:1 ratio to one troy ounce (t oz) of a 400-ounce
London Good Delivery gold bar that is stored in Brinks
Security vaults in London. PAX Gold is backed by
proven London Bullion Market Association-accredited
(LBMA) gold bars and fully redeemable for actual,
physical gold.
Paxos Standard (PAX)
PAX Standard (PAX) is an ERC-20 stablecoin that is
pegged at a 1:1 ratio to the US dollar. Created by
Paxos Standard — which also issues the Binance USD
and Paxos Gold stablecoins — every PAX is backed by
proven reserves of US dollars. While available on
many exchanges, PAX allows users to further utilize
Paxos Standard’s own financial services like enterprise
brokerage and settlement for institutions. Parent
company Paxos Trust is a New York Trust Chartered
company that adheres to regulations required for
financial businesses operating in the United States.
Peer to Peer (P2P)
A peer-to-peer (P2P) network structure as it relates to
blockchain technology is generally considered
decentralized and is designed to operate in the best
interest of all parties involved, as opposed to
benefitting mainly a single centralized entity. A peer-
to-peer blockchain network works by connecting
different computers (or nodes) together so they are
able to work in unison. This process creates a
censorship resistant, open, public computing network
that allows important data and other functionalities to
be shared across the network.
Peer-to-Peer (P2P) Lending
Peer-to-peer (P2P) lending is a process of lending
money (or crypto, and other assets) to an individual or
business enterprise (usually without a centralized
intermediary) through a decentralized online service
provider that matches lenders with borrowers. Peer-
to-peer lending service providers typically offer their
services in a cheaper and more transparent way with
less operational overhead, when compared to a
traditional financial institution. This generally results
in lenders and burrowers getting better rates and
better service overall. Recently, P2P lending has
become more commonplace in the blockchain
industry with the exponential rise of the DeFi sector.
Peer-to-Peer (P2P) Marketplace
A peer-to-peer (P2P) blockchain-based marketplace is
a marketplace that is typically more decentralized and
transparent than many of its traditional competitors.
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Peer-to-peer marketplaces are designed to operate in
the best interest of all parties involved, as opposed to
mainly benefitting a single centralized entity. A peer-
to-peer blockchain marketplace works by connecting
buyers and sellers together to create an open, global,
computational marketplace that can used fairly by all
parties involved. Many blockchain platforms have
built P2P marketplaces that run within their
blockchain networks' protocols.
Peer-to-Peer (P2P) Network
A peer-to-peer (P2P) network structure as it relates to
blockchain technology is generally considered
decentralized and is designed to operate in the best
interest of all parties involved, as opposed to mainly
benefitting a single centralized entity. A peer-to-peer
blockchain network works by connecting different
computers (or nodes) together so they are able to
work in unison. This process creates a censorship
resistant, open, public computing network that allows
important data and other functionalities to be shared
across the network.
Peer-to-Peer (P2P) Trading
Peer-to-peer trading takes place directly between two
or more network participants in a decentralized, low-
risk manner; often on a blockchain-based
decentralized exchange (DEX) or crypto wallet. This
process removes the centralized middleman allowing
the users of the platform to pay minimal or zero fees
to use the service. At this time, many crypto wallets
are developing instant exchange within a single wallet
interface that allows a user to switch instantaneously
between different types of cryptocurrencies and fiat
currencies. However, a lack of liquidity (for both
mobile wallets and DEXs), and a small overall user-
base are significant barriers for the widespread
implementation of this technology.
Permissionless Innovation
Permissionless innovation is a classification that
references the decentralized nature of blockchain-
based network protocols and blockchain technology.
Permissionless, as the name suggests, means that the
users and developers of the network do not need
permission from anyone to transact and use network
services. Theoretically, anyone can use a
permissionless network without access being granted
by a centralized authority. Open public blockchains
are generally permissionless in nature, while closed
private blockchain systems are the permissioned.
Phishing
A phishing attack is a common computer-based attack
method that is used to obtain sensitive information
like email addresses, private key addresses, mobile
phone numbers, and credit card details from an
unknowing victim. Phishing attacks are carried out by
malicious third parties posing as a trustworthy entities
like co-workers or institutions of authority to gain
access to accounts. While phishing attacks are a
common form of technological crime, they are
confidence tricks more than they are hacks.
Physical Bitcoins
Physical bitcoins are typically imitation physical metal
coins (that are designed to look like Bitcoin) that have
a private key hidden under a tamper-proof sticker or
hologram. They can be purchased pre-loaded with a
specific cryptocurrency value or without any digital
value at all. The enterprise Casascius Coins released
the first popular physical coin that represented Bitcoin
that was sold widely to the global blockchain
community. Presently, it is possible to purchase other
physical coins that represent and support other
cryptocurrency assets (such as Litecoin, Ethereum,
and Bitcoin Cash). The physical possession of these
assets should also be considered a blockchain
transaction because the recipient is now in possession
of the private key under the tamper-proof sticker on
the coin. Generally, physical coins that represent
different types of cryptocurrency assets are single-
use, and once redeemed, cannot be re-used.
Plaintext
Plaintext is an information format refers to
unformatted text in a computer envirnment that can
be understood or deciphered by an individual or
computer-based software system. In regards to
security, plaintext processed over the internet must
be equipped with added layer of security to remain
confidential. The process of encryption through the
use of an encryption algorithm or cipher converts
plaintext into ciphertext, which is encrypted data that
is unreadable.
Plutus
The Plutus platform is a smart contract development
platform designed by IOHK and the Cardano
blockchain ecosystem. Plutus smart contracts consist
of both on-chain computerized code that runs on the
blockchain, as well as off-chain or client code that run
on a user’s machine. Plutus smart contracts are
written is the programming language Haskell.
Point of Sale (POS)
Point of sale (POS) can refer to the physical or virtual
location of a customer’s purchase of an item, or the
actual physical point-of-sale device (typically a special
handheld or stationary electronic device present in a
storefront). POS systems, location, and configuration
enable marketers to target customers for new
products and service offerings and gain a wealth of
information about customers and prospects.
Polkadot
Polkadot is a decentralized blockchain network
protocol designed to allow independent blockchain
networks to connect and transfer data between one
another through cross-chain interoperable
technology. Polkadot was founded by former
Ethereum co-founder and CTO Dr. Gavin Wood.
Polkadot makes use of the GRANDPA (GHOST-based
Recursive Ancestor Deriving Prefix Agreement) and
BABE (Blind Assignment for Blockchain Extension)
mechanisms to form a hybridized Nominated Proof-
of-Stake (NPoS) consensus methodology. Polkadot
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employs DOT as the network’s native asset, which is
used to sign, send, and receive transactions, employ
governance parameters, and to conduct other
processes within the Polkadot blockchain ecosystem.
Position Management System (PMS)
Caspian’s Position Management System (PMS) is an
algorithmic portfolio and trading position
management system that allows users to manage
their trading positions across multiple exchanges and
wallets, monitor real-time and historical P&L data, and
access other advanced metrics that simplify and
improve the trading and investment process.
Position Trading
Position trading is an investment strategy that
prioritizes long-term investments in assets. Instead of
actively trading daily short-term market fluctuations
like a day trader, position traders hold an asset for
many months and years and value sustained growth.
Amongst cryptocurrency investors, position trading is
referred to as holding, or "HODL" in crypto-colloquial
terms.
Predictive Algorithms
Predictive algorithm analytics is a software-based
methodology that uses data mining, machine learning,
and predictive modeling technology to analyze the
impact of current data on future outcomes. Today,
predictive algorithms are used by large corporations
like Amazon and Facebook to algorithmically
determine the most effective way to increase sales on
products and services. Predictive algorithms are also
increasingly being used to create more personalized
digital experiences and targeted strategies in a
growing number of sectors.
Pre-Mining
Pre-mining refers to the mining of a cryptocurrency
asset (by the project’s creators and core software
developers) before a project is introduced to the
public and its underlying blockchain network protocol
goes live for the first time. Pre-mining allows the
founders of a project to possess a pre-designated pool
of funds, which is often used to ensure the longevity
of the project. However, pre-mining can sometimes
be seen as a controversial practice because the
creators of the project are able to own the assets
before a market price is set.
Pretexting
Pretexting is a social engineering technique used in
cybercrime in which an attacker typically poses as a
trusted figure such as a bank official, head of a
company, or law enforcement officer through
communication channels with the intention of
defrauding a victim. By posing as a trusted figure, the
attackers manipulate victims into sharing sensitive
data or capital, often through digital channels.
Price Discovery
Price discovery is the process of determining the
accurate price of an asset in the marketplace. This
process is often used in the options and futures
markets, or when an asset or class is new. When an
event takes place that may have an affect on the price
of an asset — like a major product release or
executive shake-up at a publicly traded company —
the short term price will fluctuate until the even has
been factored in to the price. The reaciton of the
market represents the period of price discovery. For
investors and traders, this phenomenon typically
benefits individuals with more experience, knowledge,
and access to changing market data.
Price Movement
Price movement, or price action, is the occurrence of
a change in price over time for a specific security,
cryptocurrency or asset in the market. Price action
forms the foundational basis for market trading and
charting interfaces.
Price-to-Earnings Ratio (P/E Ratio)
The price-earnings ratio (also known as the P/E ratio,
P/E, or PER) is the ratio of a company's share price
relative to the company's per-share earnings. The
ratio is used to determine the relative value of a
company’s shares, and whether the share price is
currently overvalued or undervalued. The price-
earnings ratio can also be used to compare a
company’s current value to its historical value, or to
compare different aggregated markets against each
other over a period of time. The P/E ratio is a key tool
for fundamental analysts determining an asset's
intrinsic value.
Prime Rate
The prime rate (prime) is the interest rate central and
often commercial banks charge borrowers with the
strongest credit ratings, typically large corporate
entities. In the United States, the federal funds rate,
the overnight rate banks utilize to lend to each other,
is determined by the Federal Reserve. The federal
funds rate serves as the basis for the prime rate, while
the prime rate serves as the starting point for most
retail bank interest rates, including for mortgages,
personal loans, and small business loans.
Principal
The term principal can have multiple meanings in the
financial industry, but typically refers to the original
sum of money borrowed in a loan agreement. For
example: If a borrower takes out a $500,000
mortgage, the principal is $500,000. The fee for
providing the loan service is often a percentage based
interest calculated atop the remaining principal.
Principal-Agent Dilemma
The principal-agent dilemma is a conflict in priorities
found between a person, entity, or group (principal)
and a party who has been authorized to act on their
behalf (agent). The dilemma is a result of misaligned
incentives when an agent is incentivized to act
towards their own benefit over the benefit of the
principal, or those they are enacted to represent. The
principal-agent dilemma is evident throughout
business, finance, and markets, and often requires
changing a system’s reward structure to balance the
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priorities of both sides — which is the principal
endeavor of incentive alignment.
Private Blockchain
A private blockchain system is a distributed network
that operates with key differences to an open public
blockchain protocol like Ethereum or Bitcoin. Private
blockchains are often governed by a single entity and
used by large organizations — enterprise and
government, for example — that require access
management, ensorship rights, and priveleged privacy
models. While private blockchains are built with speed
and scalablity in mind to serve the needs of the client
organization, they are not decentralized or secured by
a distributed network.
Private Key
Public-key cryptography (asymmetric cryptography) is
a specialized cryptographic system that utilizes pairs
of lengthy alphanumeric keys that only function when
used in tandem. Public keys represent a wallet
address that can be distributed to others. Private keys
are to be known only by their owner and grant access
to funds. The generation of these keys is made
possible by the usage of cryptographic algorithms
based on mathematical problems to produce a one-
way function.
Probabilistic Nanopayments
A probabilistic nanopayment is a specialized payment
mechanism utilized on the Orchid blockchain
platform, a blockchain-based VPN provider. Orchid
users purchase network bandwidth by paying rapid-
paced microtransactions in Orchid’s native utility
token (OXT). Probabilistic nanopayments are used as
representative placeholder transactions until OXT
payments are consolidated and resolved. Probabilistic
nanopayments play a definitive role in Orchid’s
internal transaction management system by lowering
costs and increasing network speed and transparency.
Profit and Loss (P&L)
Profit and Loss (P&L) is a macro-level measurement of
how much capital has been gained or lost through
trading for an individual or institution. P&L is an
important datapoint for institutional investment firms.
Unrealized P&L represents the amount of profit or
loss that a trader has taken since opening a particular
position, and is a useful metric for trading derivatives.
Proof of Authority (PoA)
Proof of Authority (PoA) is a consensus mechanism
utilized by many blockchain networks. PoA was
originally created by Gavin Wood, co-founder of
Ethereum and former CTO of Ethereum. PoA is a
consensus mechanism that leverages the value of
identity and reputation instead of cryptographic
assets or computational power. PoA relies on a limited
number of nodes to verify transactions, and is often
criticized for being too centralized. This trade-offis
offset by remarkable scalability and transaction
speeds.
Proof of Goods and Services Delivered
In Crypto.com blockchain network architecture, Proof
of Goods and Services Delivered is a status that is
cryptographically verified to prove that a payment
was sent and recieved correctly between via its Visa
card and mobile wallet products into merchant
accounts. This mechanism is used by payment
merchants and customers to confirm the legitimacy of
the payment process and ensure transparency.
Proof of History (PoH)
Proof of History (PoH) is a consensus methodology on
the Solana blockchain that incorporates the
measurement of time into a blockchain ledger with
the intent of scaling and streamlining transactional
throughput. While most blockchains operate without
a timestamp, PoH functions like a decentralized clock
that enables nodes on the Solana network to process
transactions without devoting processing power to
solving for discrepancies in minuscule differentiations
in time and order.
Proof of Importance (PoI)
Proof of Importance is an innovative consensus
algorithm developed by the NEM blockchain protocol
and is a variation of Proof of Stake. The system allows
a wide pool of users to participate in the addition of
new blocks in exchange for receiving tokenized
rewards. The rewards are determined in proportion to
a score that quantifies the user's contribution to the
network. Additionally, PoI encourages healthy activity
of the ecosystem by preventing users from hoarding
the XEM asset.
Proof of Replication (PoRep)
Proof of Replication is one of the consensus
mechanisms used by the Filecoin network. Specifically,
it is a process through which a storage miner proves
to the blockchain protocol that it has created a
distinct copy of a specific piece of data on the
network’s behalf. This process is verified by the
network through zk-SNARK cryptographic proof
technology.
Proof of Service
The DASH blockchain features a masternode system
referred to as Proof of Service (PoSe) on account of
the critical services that masternodes provide to the
DASH network. Proof of Service is the mechanism on
the DASH blockchain network used to determine if a
stake-bearing masternode is providing the correct
services in good faith to users who have contributed
tokens to it.
Proof of Spacetime (PoSpacetime)
Proof of Spacetime (PoSpacetime) is a consensus
mechanism utilized by the Filecoin network. It allows
the blockchain to prove its capacity, and in doing so, it
can cryptographically verify that the entire file is being
stored in an unaltered fashion for an agreed-upon
time frame. Proof of Spacetime is made up of two
distinct subsets: 1.) Window Proof of Spacetime
(WindowPoSpacetime) and 2.) Winning Proof of
Spacetime (WinningPoSpacetime).
Proof of Stake
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Proof of Stake (PoS) is emerging as one of the most
widely used blockchain consensus mechanisms in
existence today. PoS networks incentivize participants
to stake native tokens in a a network of validator
nodes. Upon the close of a transaction block, validator
nodes are eligible to be randomly chosen to validate
block data, thus generating the subsequent block, and
earning native tokens as reward. A robust nodal
network offers increased network security, resiliency,
and computational power. Proof-of-Stake systems
also generally enabe validator nodes to contribute
democratically in decentralized platform governance
through voting on key updates and decisions. While
still a recent innovation, PoS networks are already
proving faster and more scalable than Proof-of-Work
blockchains, in addition to being more energy
efficient.
Proof of Storage (PoStorage)
Proof of Storage (PoStorage) is a consensus algorithm
used by the Filecoin network to prove that network
participants are indeed providing the specified
amount of storage that they claim to be. This storage
space is verified by the network through zk-SNARK
cryptographic proof technology.
Proof of Work (PoW)
Proof of Work (PoW) is a blockchain consensus
mechanism first popularized by the Bitcoin blockchain
network. Proof-of-Work systems rely on a process of
mining to maintain the network. Miners provide
computer hardware that competes to solve the
complex cryptographic puzzles required to confirm
data transacted on the network, and are rewarded for
doing so with the network's underlying cryptographic
token for doing so. Proof-of-Work blockchain systems
are decentralized and secure as compared to other
network consensus methodologies, but typically
struggle to achieve the network scalability needed for
widespread global enterprise adoption. Proof of Work
is also criticized for its high energy intensivity.
Prospectus
A prospectus, as it relates to finance, is a formal
disclosure document that describes an investment
offering to potential buyers. It typically provides
investors with details about a specific stock, mutual
fund, bond, or another type of investment describing
the company’s business model, financial statements, a
list of material properties, and other important
information. A prospectus is generally distributed by
underwriters and brokerages to potential buyers who
may purchase a security through an Initial Public
Offering (IPO).
Protobuf
Protocol Buffers, or Protobuf, is a Google-based
methodology developed for serializing structured
data. The system allows interface description
language to describe the structure of different data
types. This ensures that different distributed database
networks — such as blockchain systems — are able to
incorporate the use of more software programming
languages to be more adaptable as their capabilities
expand.
Provenance
Provenance is the historical record of ownership of
any tangible or intangible asset. Open public
blockchain systems employ an optimal structure for
tracking the provenance of assets because of their
permissionless, immutable, and censorship resistant
features.
Public Address
A public address is a shortened version of a user’s
public cryptographic key. Public addresses are used to
receive transactions through a blockchain network
protocol and are commonly used in place of a public
key.
Public and Private Keys
Public-key cryptography (asymmetric cryptography) is
a specialized cryptographic system that utilizes pairs
of long alphanumeric keys that work together in a
pair: public keys, which can be distributed to others,
and private keys, which are known only by their
owner. Public keys are used to store cryptocurrencies
on the blockchain. They are also used to send
cryptocurrencies in conjunction with the use of the
public key's corresponding private key. The generation
of these keys is made possible by the usage of
cryptographic algorithms based on mathematical
problems to produce a one-way function.
Public-Key Cryptography
Public-key cryptography (asymmetric cryptography) is
a specialized cryptographic system that utilizes pairs
of long alphanumeric keys that work together in a
pair: public keys, which can be distributed to others,
and private keys, which are known only by their
owner. Public keys are used to store cryptocurrencies
on the blockchain. They are also used to send
cryptocurrencies in conjunction with the use of the
public key's corresponding private key. The generation
of these keys is made possible by the usage of
cryptographic algorithms based on mathematical
problems to produce a one-way function.
Public-Key Infrastructure
Public-key infrastructure (PKI) is a set of policies,
procedures, and hardware-software combinations
needed to authenticate users and devices online. In
practice, this involves one or more trusted parties
digitally signing a digital document or decentralized
ledger in order to certify that a particular
cryptographic key belongs to a particular user or
device. PKIs play a pivotal role in creating, managing,
distributing, using, and storing digital certificates, and
managing public-key encryption.
Public Representative Nodes (P-Reps)
Public Representative Nodes (P-Reps) are the most
powerful nodes that exist within the ICON Network. P-
Reps are responsible for network validation and the
creation of blocks and other important processes.
There are 100 P-Reps that are responsible for the
governance of the ICON Network (with 22 main P-
53
Reps and 78 secondary P-Reps). P-Rep standings are
always changing and are determined by the voting
power of staked ICX by global ICON Network
community members (known as ICONists).
Pump and Dump (P&D)
A pump and dump is a scheme that occurs when a
trader or investment firm buys a large amount of an
asset — sometimes illegally — and later promotes, or
“pumps” up the underlying company with misleading
information to draw unsuspecting investors to buy in,
thus further increasing its value. Shortly afterwards,
the trader or investment firm “dumps” by selling the
asset at a much higher price, which results in losses to
investors who bought in at a later time. In crypto
markets, this often occurs when a whale buys a large
quantity of a specific crypto asset with a large sum of
money to drastically increase the price before selling
after a substantial profit.
Put Option
A put option contract (the opposite of a call option) is
a specialized contract that is sometimes used in
derivatives trading. It gives an investor the right, but
not the obligation, to sell an underlying security (or
cryptocurrency, or other type of asset) at a specified
price within a defined time period. When the option
contract expires, the investor can choose to sell the
underlying security or let the option contract’s value
depreciate to zero. Put options can sometimes be
used in combination with call options to form unique
trading strategies.
Q
Qtum
Qtum is public Proof-of-Stake blockchain protocol
based on Bitcoin’s code but modified to allow smart
contracts to run on top of its UTXO (Unspent
Transaction Output) model. With Qtum Neutron, the
blockchain is able to connect to several Virtual
Machines (VMs) simultaneously. This allows Qtum to
make use of the Ethereum VM and its own state-of-
the-art x86 VM while leveraging the capabilities of its
1,000-node blockchain network.
Qualitative Analysis
Qualitative analysis uses subjective judgment to
analyze an enterprise’s value or potential long-term
growth based on non-quantifiable information such as
management expertise, research and development,
industry cycles, and other complex data. Qualitative
analysis is the opposite of quantitative analysis, which
focuses primarily on numerical data reporting and
balance sheets. Both metrics are important to
evaluate in order to gain a better perspective on a
potential investment opportunity.
Quick Response Code (QR Code)
A quick response code (QR code) is a type of matrix
barcode that uses a machine-readable optical label
(typically scanned with a mobile phone) containing
sensitive information about the item it is attached to.
QR codes often contain data for a tracker, locator, or
identifier that points to a mobile application or
website. QR codes use four standardized encoding
methods (byte/binary, alphanumeric, numeric, kanji)
to store data.
Quorum (Governance)
A quorum is defined as the minimum number of
members required to conduct business within a
specific group. As it pertains to blockchain technology,
quorum biasing denotes that if many voters
participate, the vote is more legitimate than if, in turn,
very few participate. This mechanism can be used to
determine the fairness of specific proposed
blockchain-based governance parameters, such as the
minimum amount of participating tokens required for
a vote to be valid. Typically, if a vote fails to reach the
quorum, then it is automatically cancelled.
R company that owns, operates, or finances income-
Radio Frequency Identification (RFID)
Radio-Frequency Identification (RFID) uses
electromagnetic fields to identify and track tags which
are attached to objects. A RFID tag is made up of a
very small radio transponder as well as a radio
transmitter and receiver. RFID tags can be triggered
with an electromagnetic pulse from a nearby RFID
device reader to transmit digital data often underlying
an inventory number back to the reader. This
specialized number can be utilized to monitor
products that have RFID tags attached to them, so the
items can be authenticated, tracked, and located at
any time (in this case through the VeChainThor
blockchain platform).
Random-Access Memory (RAM)
Random-access memory (RAM) is a type of computer
memory that can be read or changed in any order to
store specific working data and machine code. RAM
can be read or written in nearly the same amount of
time regardless of the physical location of the data
within the memory.
Random Beacon (Keep Network)
A Random Beacon is a specialized blockchain-based
random number generator used by the Keep Network
blockchain protocol to help employ its
containerization private data model. The Random
Beacon uses threshold signatures with digital
signature relays to randomly select groups of KEEP
token holders to be network transaction signers.
Signers are responsible for creating new bitcoin key
pairs that are used to create tBTC tokens.
Randomness is an integral component in creating
secure and hack-resistant technical blockchain
architecture.
Ransomware
Ransomware is a type of malware or malicious
software that blocks access to a user’s computer
system or threatens to leak sensitive or personal data.
The goal of most ransomware attacks is to extort a
ransom payment in exchange for restoring access to
sensitive encrypted data. Ransomware has become a
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powerful tool for bad actors targeting users that could
potentially lose their all-important data. Ransomware
attacks can pose a heightened threat to
cryptocurrency users because demands are often
sought in bitcoin or other digital currencies to avoid
unwanted detection.
Ransomware-as-a-Service (RaaS)
Ransomware-as-a-service (RaaS) is typically a
software-based program developed by malicious
online cybersecurity experts that is sold to less
knowledgeable cybercriminals in order to attack
unsuspecting users with the goal of stealing sensitive
data. Hackers often advertise their “service” on online
marketplaces within the dark web and ask to be paid
in cryptocurrency for their products and services.
Real Estate Investment Trust (REIT)
A real estate investment trust (REIT) is defined as a
generating real estate. REITs are generally modeled
after mutual funds and pool the capital of numerous
investors together, so a purchaser is not required to
individually own property to potentially receive
financial rewards.
Reciprocally Analogous Virtual Machine (VM)
A reciprocally analogous Virtual Machine (VM) is a
type of VM that is designed to communicate in a
beneficial manner with another VM or
blockchain/computer system. A VM is a cloud-based
imitation of a computer system that is based on
different types of computer architecture to provide
the functionality of a physical computer system. VM’s
may be made to emulate types of specialized
hardware, software, or a combination of the two.
Additionally, some VM’s are built to mimic different
computer architectures and software applications
and/or operating systems written for another type of
computer or architecture.
Recovery Phrase
A recovery phrase, also referred to as a “seed phrase”
or “recovery seed phrase," is a 12, 18, or 24-word
code that is used as a backup access mechanism when
a user loses acess to a cryptocurrency wallet or
associated private key. The seed phrase matches
information stored inside the a corresponding wallet
that can unlock the private key needed to regain
access.
Recovery Shares
Recovery shares are a security mechanism that allow a
user to designate how many shares are created, and
what percentage are required to regenerate a wallet
and its pubic and private keys. For example, a user
could potentially designate a 5-of-7 share threshold to
determine the number of recovery shares needed to
open their wallet. Compared to a solitary recovery
phrase, the recovery shares mechanism makes theft
more difficult and simplifies the wallet regeneration
process.
Recurring Buy
A recurring buy is a practice whereby an investor sets
aside a specific sum of capital to buy a target asset at
recurring intervals. This process occurs when an
investor leverages a stockbroker or exchange to set a
specific time to purchase an asset or multiple assets
on a recurring basis.
Regulation T (Reg T)
Regulation T, sometimes referred to as Reg T, is a set
of rules that was first implemented by the Federal
Reserve Board in 1974 to reduce risk in securities
transactions. Regulation T enables securities dealers
to extend credit to their clients, while its main
functionality is to control the margin requirements
and stocks bought on margin by investors. According
to Reg T, traders are able to receive up to 50% of a
trade’s value via margin from their broker. This
mechanism was put into place to control leverage
trading risk and limit the total buying power of
investors.
Regulatory Compliance
Regulatory compliance is the process of making sure
specific enterprises meet certain guidelines
introduced by government bodies — such as the
Securities and Exchange Commission (SEC) in the US.
These guidelines seek to protect investors, ensure
consumer confidence, facilitate the transparency,
efficiency, and fairness of markets, and reduce
financial crime and system risk. Financial services
organizations are further subject to regulations
governing customer communications, advertising,
management of client assets, customer understanding
and suitability, conflicts of interest, customer dealings,
capital regulations, and more.
Rehypothecation
Rehypothecation is a process that occurs when banks,
brokers, exchanges, and other financial service
providers use client assets for their own purposes to
benefit both sides. For example, several blockchain
enterprises use a portion of their clients'
cryptocurrency holdings as collateral to be lent to
institutional investors. In exchange, users receive
incentivized rewards for holding their assets on the
platform. Companies in the blockchain industry that
make use of this process include Binance, Huobi,
Crypto.com, Celsius Network, and BlockFi.
Relative Strength Index (RSI)
The relative strength index (RSI), in technical analysis,
is a momentum indicator that’s used to measure the
impact of recent price changes to calculate
overbought or oversold conditions of a specific stock,
cryptocurrency or any type of investment asset. The
RSI is displayed as an oscillator, or line graph that
moves up and down, and is measured between the 0
and 100. In the investment industry it is commonly
accepted that an RSI rating over 70 is overbought or
overvalued, while an RSI rating under 30 is oversold or
undervalued. The RSI investment metric like all
technical indicators should only be used as one data
point to better analyze current market conditions.
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Relay Chain
The Relay Chain is the main protocol and most
powerful component of the Polkadot network. It is
responsible for maintaining network consensus with
the help of the hybrid GRANDPA and BABE Nominated
Proof-of-Stake (NPoS) consensus mechanism. The
Relay Chain utilizes validators, parachains, collators,
fishermen, and nominators to ensure the network
works correctly at all times and is used as a main
control center to interact with external blockchains
through bridges and internal Polkadot-based
blockchain protocols (parachains). The Relay Chain
also utilizes the DOT asset to allow various nodes in
the ecosystem to work correctly and for other uses.
Relayer (0x)
Relayers are 0x decentralized exchange (DEX) users
who host off-chain order books, list buy and sell
orders, and charge transaction fees. Relayers do not
act as a trusted intermediary on the 0x platform, nor
do they execute trades, however, their main purpose
is to host order books externally to the 0x platform.
Relayers help traders find counter-parties (other
participants that transact within the network) and
cryptographically move orders between them.
Remittance
A remittance is a payment from one place to another,
and in most cases involves an individual transferring
capital to an overseas contact. Typically, these
payments are made via an online service provider,
cryptocurrency wallet, or other tech-enabled financial
conduit, and completing a cross-border money transer
using a blockchain-based transfer mechanism is
oftentimes quicker and more cost-effective than
sending a remittance through the traditional banking
system. With the advent of blockchain technology and
mobile cryptocurrency wallets, individuals can now
transfer substantial amounts of capital essentially
anywhere in the world within seconds while incurring
minimal fees.
Remittance Network
A remittance network is a fintech service provider that
allows enables remittance payments to be sent both
domestically and abroad. Examples of large-scale
remittance service providers include PayPal, Western
Union, and Revolut. As a third-party processor and
validator of remittance payments, remittance
networks act as a financial intermediary between
customers and their contacts and often charge
substantial service fees. Blockchain-enabled payment
networks have been designed in part to help alleviate
current cost and efficiency issues inherent in
traditional remittance networks and avoid the need
for third-party validators.
Remote Procedure Call (RPC)
A Remote Procedure Call (RPC) is when a computer
utilizes a computer program that causes a procedure
to execute via a distinct address space on another
shared network or computer. This is done through
coding and by using a local procedure call where the
software engineer leverages a location transparency
so they don’t have to provide details on the remote
interaction.
Ren (REN)
The Ren Network is a decentralized protocol of virtual
devices called Ren dark nodes that provide network
interoperability in order to enable cross-chain lending,
exchanges, and other services between different DeFi
protocols. To make this a reality, Ren makes use of a
multi-party computation algorithm as a consensus
protocol while using the Ren Virtual Machine (RenVM)
to directly enhance liquidity on the Ethereum
Network. This functionality enables the platform to
lock assets on-chain and mint them individually. The
Ren Network utilizes its own native token (REN),
which primarily functions as a payment token to place
orders within the network.
Repair Miners
Repair miners are a proposed (as of June 6th, 2020)
type of mining node within the Filecoin network that
is presently in development. Repair miners, once
enabled, will be able to facilitate self healing of the
Filecoin protocol. At this time, the network is fully
functional without the full implementation of repair
miners and other types of miners that will be added in
the future.
Replace by Fee
Replace by Fee (RBF) is a Bitcoin protocol tool
developed by famous blockchain developer Peter
Todd that allows one version of an unconfirmed
transaction to be replaced with another transaction
that pays a higher transaction fee. Via RBF,
unconfirmed transaction are stored in the mempool,
which is where valid transactions wait to be confirmed
by the Bitcoin network. From there, these stored
transactions can then be replaced with another
transaction if the sender of that transaction offers to
pay a higher transaction fee. As a resut, while RBF can
help reduce network congestion and help prioritize
transactions in accordance with senders' willingness
to pay, the mechanism is somewhat controversial
because it alters the immutability of the involved
transactions.
Reporting
Reporting as it relates to institutional investment is a
process by which analysis tools are used to create
reports and compile other data to monitor different
aspects of a portfolio’s profitability. Reporting
mechanisms can be used for long-term and short-term
(trading) analysis. Specialized reporting tools allow
institutional investment firms to analyze profit and
loss (P&L) data, execution data, position size, entry
type, exposure, and much more.
Retail Investor
A retail investor is a non-professional investor that
buys and sells securities, mutual funds,
cryptocurrencies, or other investment assets through
a traditional or online brokerage firm, exchange, or
other type of investment account. Retail investors
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typically buy securities or other assets for their own
personal use and generally trade (or hold long-term)
in much smaller increments compared to institutional
investors.
Retrieval Miners
Retrieval miners, along with storage miners, are the
two key components that make up Filecoin’s
decentralized market structure. The Filecoin network
benefits three main groups of users: (1) Retrieval
Miners who receive tokens by serving data, (2)
Storage Miners, who receive tokens by providing
storage, and (3) clients who pay to store and retrieve
data. The retrieval market is built off-chain, and is
powered by retrieval miners who help transmit data
back and forth.
Return on Assets (ROA)
Return on Assets (ROA) is an indicator that is used to
determine how profitable a company is relative to its
total assets. This metric allows companies and other
organizations to determine how efficiently their assets
are being leveraged to generate earnings. ROA is
displayed as a percentage and is calculated by dividing
the enterprise’s net income by its total asset amount.
The higher the ROA, the higher the relevant
organization's asset efficiency. ROA is often used to
compare similar companies or to benchmark a
company's current operations against its past
performance. The ROA indicator also takes into
account a company’s debt level unlike other common
metrics such as Return on Equity (ROE).
RingCT (Confidential Transactions)
Ring Confidential Transactions (RingCTs) are a
mechanism used within the Monero blockchain
platform which allows the amount in a transaction to
be hidden, similar to now the system’s ring signature
mechanism obfuscates the details of sending and
receiving addresses. RingCTs drastically improve the
unlinkability and untraceability of transactions within
the Monero network by allowing for ring outputs of
various transaction sizes, without compromising the
anonymity of the transaction. This function was added
to Monero in January of 2017 and made mandatory
on the network in September 2017.
Ring Signature
A ring signature is a mechanism that is used to conceal
the details of a digital signature in order to hide the
specific details of the relevant network transaction.
This unique digital signature format can be used by
any member of a group of users that is in possession
of the correct cryptographic keys. Therefore, it is
nearly impossible to determine which group
member’s keys were used to produce the signature,
which essentially allows the sender of a transaction to
remain anonymous and untraceable. The name 'ring
signature' is denoted by the ring-like structure of the
signature algorithm, and Monero was the first
blockchain network protocol to implement ring
signatures in 2015.
Ripple Gateway
Ripple Gateways are businesses that allow their
customers to deposit their funds in exchange for
Ripple IOUs, thereby providing an entry point into the
Ripple network. Ripple Gateways allow their
customers to transfer both traditional and
cryptocurrency funds across the network, and are also
used to transfer customer-owned Ripple IOUs to
another address or withdrawal their funds by
redeeming their Ripple IOUs. Each Ripple Gateway is
designed with specific features which ensure the
security of the underlying organization's network and
the capital their institutional clients deploy within the
network.
Risk Management System (RMS)
Caspian’s Risk Management System (RMS) is used to
monitor trading and investment decisions to help
ensure greater profitability (by taking into
considerations specific risk-based parameters). RMS
can also be used to generate detailed risk metrics that
allow traders to see the overall market more clearly.
This functionality allows users to make better trading
and investment decisions.
Roll-Up
Roll-ups are an off-chain aggregation of transactions
inside an Ethereum smart contract. Roll-ups are used
to combine and process smart contract transactions
off-chain before settling the final state on-chain. This
is done to lower transaction fees given that the rising
popularity of decentralized finance (DeFi) offerings on
Ethereum has caused gas fees to increase
substantially. Roll-ups are considered a throughput
solution, not a scaling solution, as they usually require
additional hardware to settle transactions on-chain.
Rootkit
A Rootkit is a specific type of Trojan malware designed
to gain unauthorized root or administrative access to
a target device or network. Many rootkits are
specifically designed to subvert security software and
contain a variety of tools that enable hackers to steal
personal information, damage, or completely hijack
an infected device. As a result, rootkits are notoriously
difficult to detect and remove, and in some cases the
only way to remove a rootkit from a device is to
reinstall the device's entire operating system.
Roth IRA
A Roth IRA is a U.S. individual retirement account that
offers tax-free growth on funds vested in the account
and tax-free withdrawals from the account after the
account holder meets certain criteria. More
specifically, Roth IRA account holders that are at least
59.5 years old or older and have had their account
open for at least five years are eligible to withdrawal
the funds within their account any time they want
without paying federal taxes.
Ruby
Ruby is a high-level, interpreted, general-purpose
computer programming language designed by
Yukihiro "Matz" Matsumoto. Ruby supports a diverse
range of other programming languages and can be
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utilized for many different situations in software
development.
Rust
Rust is a multi-paradigm programming language
designed to prioritize safety and performance. Rust is
syntactically similar to C++ and has gained increased
use across multiple enterprise industry applications.
Microsoft is experimenting with Rust and has used the
language to develop a range of security-oriented
software components. Graydon Hoare at Mozilla
Research initially created the language back in 2010
and Brendan Eich, the creator of JavaScript and
founder of Brave Browser/Basic Attention Token, was
one of the early contributors to Rust's development.
Ryuk Ransomware
Ryuk ransomware attacks are a type of ransomware
attack in which a malicious actor aims to render a
target device/network's essential files inaccessible to
its legitimate users so that the attacker can levy a
ransom against the target. Once the essential files are
corrupted, encrypted, or otherwise compromised, the
victim is typically unable to regain access to these files
on their own and are pressured to pay the demanded
ransom amount, which is oftentimes hundreds of
thousands of dollars per attack. Ryuk attacks are
relatively common and these attacks regularly account
for tens of millions of dollars' worth of damages each
year.
S
Safety Module (Aave)
Within the Aave economic framework, the Safety
Module is a specialized security feature designed to
mitigate the potential effects of an unexpected drop-
off in liquidity, which might otherwise substantially
reduce the AAVE token’s overall value. The Safety
Module is built using the Balancer liquidity pool and
allows for AAVE and ETH tokens to be staked at a 4:1
ratio in order to earn rewards and vote on protocol
changes. If necessary, up to 30% of the AAVE tokens
staked in the Safety Module can be sold in order to
provide liquidity to Aave.
Sandboxes
Within a cybersecurity context, a sandbox is a security
mechanism that is designed to mitigate the potential
impact of system failures and/or software
vulnerabilities by allowing programs to run
independently of and separately from the
device/network's primary operating system.
Sandboxes are often used to test out new
implementations and code bases or audit untested
programs to ensure that they behave as planned prior
to deployment. Sandboxes are also commonly
deployed while testing the performance and features
of a Virtual Machine (VM).
Satellite (Storj)
Satellites are an essential part of Storj’s decentralized
data storage network framework which audits Storj
storage nodes to ensure that they are storing their
assigned data and acting in an honest manner.
Satellites receive payments for securing the network
and periodically distribute payments to storage nodes
for providing data storage. Additionally, Satellites also
store the metadata of the network's segmented files,
which enables client to receive their files upon
request.
Satoshi Nakamoto
Satoshi Nakamoto is the pseudonymous individual or
group responsible for creating the Bitcoin protocol.
Satoshi Nakamoto famously published the Bitcoin
whitepaper in October 2008 and mined the first
'genesis' block on the Bitcoin network in January 2009.
In April 2011, Satoshi Nakamoto posted on an online
forum saying that he had “moved on to other things”
and disappeared completely from the blockchain
community. Since then, the true identity of Nakamoto
has remained unknown, although there are a variety
of unproven theories which claim to have unraveled
the mystery of this individual/group.
Satoshis
Named after the pseudonymous individual or group
that created Bitcoin, Satoshis, or “sats,” are the
smallest divisible unit of the Bitcoin cryptocurrency.
Like all cryptocurrencies, Bitcoin are fully divisible and
there are 100 million satoshis in one Bitcoin token
(BTC). Many crypto enthusiasts track the price
fluctuations of their respective cryptocurrencies in
terms of sats rather than fiat currencies, which
reflects their skepticism/rejection of the traditional
financial system.
Scalability
Within the context of blockchain technology,
scalability is the capacity of a blockchain network to
increase the transactional finality speed and
throughput needed to improve processing times for
transactions that are being sent and received via
network protocol. The higher a network's scalability,
the more efficiently it can send transactions and
process different types of data. Scalability is one of
the three main characteristics of a mature blockchain
network, with the other two being decentralization
and security.
Scalp Trader
A scalp trader, or scalper, is a type of investor that
typically enters and exits financial positions very
quickly—usually within the span of minutes or
second— with the goal of generating consistent
profits from incremental movements in an asset’s
price. To acomplish this, scalpers often use high-
leveraged trading positions in a derivatives trading
environment. Scalpers are often employed by large
institutional investment firms, equipped with a suite
of tools to help automate many of their trading
decisions, and allocated a significant amount of
investment capital in order to make their trades
worthwhile.
Scareware
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Scareware is a type of malware that utilizes social
engineering to invoke fear, anxiety, and/or shock in a
target in order to persuade to purchase unwanted
software. Scareware commonly takes the form of
rogue security software, ransomware, or some other
type of software that misleads a user into thinking
that their device has been infected with a virus. If a
user is sufficiently convinced by the scarware's urgent
and dire warnings, they may be compelled to
purchase additional software to eliminate the alleged
"threat". Oftentimes this program a user downloads
to fix the purposed issue is actually a malignant virus
or a useless, resource-draining subscription-based
service.
SCORE (Smart Contract on Reliable Environment)
SCORE (Smart Contract on Reliable Environment) is
ICON’s framework for composing, amending, and
initializing smart contracts on the ICON network. In
ICON 1.0, smart contracts were written in Python. In
the upcoming release of ICON 2.0, SCORE will be
adapted to utilize JavaScript. This should lead to
increased performance and better integration with
ICON’s Virtual Machine. This should also improve
integration and development capabilities for software
developers.
Screen-Locking Ransomware
Screen-locking ransomware is a type of software that
blocks a target user's access to their device's
operating system. This type of ransomware typically
works by locking the user’s device and displaying a
message prompting the user to pay a specific ransom
unlock their device, or run the risk of forever losing
the contents of their device.
Scrypt
Scrypt is the hash function that converts an input of
letters and numbers into an encrypted output that is
used by the cryptocurrency Litecoin. It differs from
the SHA-256 hash function that is used by Bitcoin, but
it also functions within a similar Proof-of-Work (PoW)
consensus mechanism. The Scrypt hash function was
originally designed to limit mining to only CPUs and
GPUs, although scrypt-capable ASICs have since been
developed.
Secure Sockets Layer (SSL) & Transport Layer Security
(TLS) Certificates
A Secure Sockets Layer (SSL) Certificate is a
technological standard used to enable a secure
connection between a Web server and client on the
internet. SSL certificates are installed on a Web server
and scramble transmitted data through encryption
algorithms in order to prevent malicious actors from
being able to access data as it moves from one system
to another. Transport Layer Security (TLS) Certificates
represent a recent, updated version of SSL with
further enhanced security.
Securities and Exchange Commission (SEC)
The U.S. Securities and Exchange Commission (SEC) is
a large independent body of the U.S. federal
government that is responsible for proposing
securities rules, enforcing federal securities laws, and
regulating the U.S. investment industry. The SEC is
responsible for protecting investors, maintaining fair
and smooth functioning of U.S. securities markets,
and facilitating capital formation.
Security Token
Security tokens are a tokenized stake in the ownership
of any asset that has value, such as a business or a
piece of real estate, which is recorded in a blockchain
ledger. Within the context of corporate ownership,
security tokens are analagous to corporate stocks, or
fractions/multiples of a stock, and therefore represent
an equity stake in a company, along with whatever
future returns a partial ownership of that business
entails, such as dividend payouts. As a result, security
tokens offer a more flexible yet secure way of
transferring, exchanging, and storing value.
Security Token Offering (STO)
Security Token Offerings (STOs) are a method of
distributing security tokens and exist somewhere
between Initial Coin Offerings (ICOs) and Initial Public
Offerings (IPOs). To better understand this, it's
important to note that security tokens are equity
tokens that represent an equity stake in a company or
asset, in addition to whatever future returns are
associated with partial ownership of that entity, such
as dividend payouts. STOs are generally considered
superior to ICOs due to the fact that STOs offer instant
settlement times, clearer regulatory guidelines, higher
liquidity, and a lower barrier to entry in many
instances, among other benefits. Since enterprises
that create registered securities must adhere to
specific compliance and regulatory requirements,
STOs avoid a lot of the market ambiguity which
ultimately turned many investors off to ICOs, while
continuing to offer a straightforward, investor-friendly
method of issuing, trading, and storing tokenized
equity shares.
Seed Phrase
A seed phrase, also referred to as a “recovery phrase'
is a 12, 18, or 24-word code that is used as a backup
access mechanism when a user loses acess to a
cryptocurrency wallet or associated private key. The
seed phrase matches information stored inside the a
corresponding wallet that can unlock the private key
needed to regain access.
Segregated Witness
Segregated Witness (SegWit) is the name of a soft fork
that was carried out on the Bitcoin network which
changed the transaction format of the protocol.
Segwit separates signature data from transaction data
within the blockchain to increase the total amount of
data within a specific block. By rearranging the data
contained in each block more efficiently, more space
is freed up which allows for the inclusion of additional
data. SegWit is capable of increasing Bitcoin's block
size limit from 1MB to 2MB and was designed to
mitigate the blockchain size limitation issues that
periodically slow down transaction speeds on the
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Bitcoin network. This is accomplished by "segregating"
the transaction into two segments by removing the
unlocking signature's "witness" data from the original
portion and appending it as a separate structure at
the end of the block.
Self-Regulatory Organization (SRO)
A self-regulatory organization (SRO) is an entity that
has the power to independently create and enforce
accepted professional regulations and standards
without the need for external oversight or
intervention.
Self-Sovereign Identity (SSI)
Self-sovereign Identity (SSI) is a general concept that
describes a user's ability to own their own identifying
data without the need for third-party assignment or
validation. While there are multiple technical
approaches to actualizing SSI from a practical
standpoint, none have yet to emerge as a broadly
recognized global standard.
Sell-Off
A sell-off is a sudden, high-volume sale of a security or
other asset which typically reduces the price of the
relevant asset, at least in the short term. While there
are a variety of reasons for why a sell-off may occur, in
most instances sell-offs take place as a result of
widespread market panic, either due to negative news
or a black swan event, or coordinated market
manipulation initiated by institutional investors or
"whales".
Separate Account
A separate account is an investment portfolio owned
by an investor that is managed by an investment
firm—typically a registered investment advisor (RIA).
Separate accounts provide their owners with real-time
visibility into all their holdings and transactions as
they occur, as opposed to retroactively, as is the case
with mutual funds. While most separate accounts are
opened through a financial advisor or investment
brokerage, they can also be managed through an
insurance company or bank. Separate accounts are
also commonly referred to as separately managed
accounts (SMAs) or individually managed accounts.
Sequencer
As part of the optimistic roll-up layer two scaling
solution proposed for the Ethereum network,
sequencers — or aggregators — process transactions
off-chain before sending them on-chain to be
finalized. While sequencers are financially rewarded
for their role in optimistic roll-up models, they must
put up a bond — known as a fraud proof — as
collateral to disincentivize malicious action. Executed
at scale, this methodology could save both capital and
offers a boon to Ethereum throughput capacity.
Serenity
Serenity is the multi-phased Ethereum upgrade
currently underway that is transitioning the Ethereum
blockchain from a Proof-of-Work consensus
mechanism to Proof of Stake, while segmenting the
network into specialized shard chains that are
optimized for scale. Both updgrades are
groundbreaking technological endeavors that will
increase speed, efficiency, and network scalability on
Ethereum. Because of the complexity required in
launching Ethereum 2.0, Serenity is designed to
launch in a total of four phases over the next five to
10 years. Phase 0 was successfully deployed in
December 2020 with the launch of a beacon chain.
Settlement
Settlement is the process of determining when a
transaction is completely confirmed, or settled, by all
interested parties. Until settlement provides
confirmation of a completed exchange, the
transaction remains pending and unresolved. The
speed of settlement finality has major economic
repercussions for businesses. Longer settlement times
may lead to costly and time-consuming delays, and
add up throughout a marketplace to significantly slow
the process of conducting business throughout many
industries. Shorter settlement times speed up
business operations, save money, and remove
uncertainty.
Settlement Agent Node
On the Crypto.com blockchain, Settlement Agents are
network nodes that take the role of enabling
settlement between the platform's native CRO token
and other stable cryptocurrencies like stablecoins.
Settlement agents are relied on by buyers and sellers
to exchange tokens and accurately settle a
transaction. Settlement Nodes are eligible to earn a
profit from charging a .5% fee for payouts made in
fiat.
Settlement Finality
Settlement finality is the process whereby a
transaction is absolute and confirmed by a blockchain
network protocol. Before settlement finality is
achieved, the transaction remains pending and may
not be considered completed. Rapid and broad
settlement finality is necessary to achieve high
throughpot scalability on a blockchain, the
achievement of which remains pivotal to the
widespread applicability of decentralized tech for
global enterprise use.
SHA-256
SHA-256 is a member of the SHA-2 cryptographic hash
function family that was designed by the National
Security Agency (NSA) and later made famous for
being a foundational aspect of the Bitcoin blockchain
network. SHA-256 is a Secure Hash Algorithm (SHA)
that to secures data by utilizing a cryptographic
mathematical operation to generate a unique 256-bit,
64-character random sequence of letters and
numbers (called a hash) out of an input. These
functions are generally designed to serve as a one-
way function that is virtually impossible to reverse
once a piece of underlying data has been amended
into its hash value.
Shard Chain
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Shard chains are created by partitioning a blockchain
into smaller, more manageable pieces. This process
decreases the workoad on validator nodes, which are
only required to store and manage one shard instead
of the entire blockchain system. Alongside other
optimizations, shard chains are expected to
drasticallly increase netwoek throughput and speed as
opposed to monolithic consensus mechanisms. The
Ethereum 2.0 blockchain will be separated into 64
shards that will operate as smaller blockchains tied to
a main Beacon Chain. Ethereum 1.0 is intended to
make up just one of those shards.
Sharding
Sharding is a mechanism that is used to partition a
blockchain network orother type of computer
network or database. Its purpose it to distribute the
network's computational and storage workload across
a broader set of devices, or nodes, in order to increase
the throughput and transaction speed of the entire
system. Each node only maintains information related
to its specific shard or partition, and since each node
is only responsible for processing a fraction of the
overall network's transactional load, the network's
overall processing capabilities and resilience can be
vastly improved. As a result, the increased transaction
speeds made possible through sharding have allowed
many blockchain-based networks to be exponentially
faster, more secure, and better suited for widespread
enterprise use.
Shards
Sharding is a mechanism that is used to partition a
blockchain network, or any other type of computer
network or database. Its purpose it to spread out the
computational and storage workload across a larger
set of computers to increase the throughput and
transaction speed of the entire system. Sharding
works by increasing the overall capability of the
network so that each node isn't responsible for
processing the entire network's transactional load.
Instead, each node only maintains information related
to its specific shard or partition. Increased transaction
speeds through sharding allow blockchain-based
networks to be exponentially faster and better suited
for widespread enterprise use.
Sharing Economy
The sharing economy is a socioeconomic system built
around the concept of mutually sharing resources
within a network to benefit all its members. This
process is typically enabled through peer-to-peer
(P2P) networks which allow for the purchase and/or
exchange of goods and services in a way that differs
substantially from traditional company-to-customer
business models. In recent years, the sharing economy
model has given rise to a variety of innovative
business models, ranging from ride-sharing to
decentralized content platforms. Open public
blockchain networks help realize the potential of the
sharing economy by virtue of their decentralized,
transparent, and censorship-resistant nature.
Shielded Transaction
Shielded transactions are a unique transaction type
that conceals specific data about a transaction, such
as the amount being transferred or the involved
account addresses, in a way which is still verifiable on
the blockchain. While different blockchain projects
deploy different methods to enable the use of
shielded transactions, many of these methods involve
zk-SNARK cryptography to obfuscate transaction data
prior to the transaction being recorded in a
blockchain.
Shielding Transactions
Shielding transactions take place on the Zcash
protocol when data is sent from a public sender to a
private receiver. Zcash employs the usage of zk-SNARK
cryptographic proof technology to keep sheild the
data and keep it private, immutable, and secure,
despite the differing privacy requirements of the
transactors.
Sidechain
A sidechain is an external secondary blockchain
protocol that is connected to a primary blockchain
network (mainchain). Sidechains are typically
designed to allow for the transfer of data and value
between themselves and the mainchain, and
oftentimes use a different consensus mechanism than
the mainchain. As a result, sidechains can allow for a
higher degree of flexibility and scalability, given that
systems with a significant sidechain interoperability
component are often designed to cater to a broader
range of enterprise and individual users.
Signature-Based Security Programs
Signature-based security programs are a type of
security software that identifies malware using well-
known, pre-recorded digital signatures or identifiers.
These programs identify malware by cross-referencing
a supicious program's digital signatures with the
digital signatures of existing malware software which
have been stored in a database specifically designed
to archive and help identify a wide array of
documented malwares.
Signature (Cryptographic)
A cryptographic signature is a mathematical
mechanism that is used to verify the authenticity of a
digital message or digital document within a digital
network. Cryptographic signatures are commonly
used for financial transactions, digital contract
management, software distribution, and a broad array
of other use cases that prioritize the accurate
detection and prevention of forgery and data-
tampering. In regards to blockchain technology,
cryptographic signatures are typically used to prove
that the correct private key was used to initiate and
send a transaction through a complex authentication
process that involves the use of both a private and
public key.
SIM Swap Attack
A SIM swap attack is an attack that involves taking
control of a victim’s SIM card, which stores private
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user data and a broad range of user access
credentials. Attackers executing a SIM swap attack will
oftentimes deploy a variety of social engineering
techniques, such as calling a cellphone provider and
impersonating the victim, with the goal of obtaining
sensitive personal information about the victim. If
successful, the attacker will typically use the
information they acquired to request a new SIM card,
which will allow them to gain control over the victim’s
phone number and whatever potentially sensitive
data is linked to that number.
Slippage
Within a financial context, slippage refers to the
difference between the expected price of a trade
relative to the actual price at which the trade is
executed. Slippage generally occurs when an investor
buys or sells an asset on a platform with poor liquidity
and low trading volume. If there is a large gap
between the bid-ask price on an exchange's order
book, the asset purchaser may end up paying more for
an asset or receive less of the asset than expected
once the trade has been executed.
Slot
The Cardano blockchain utilizes a protocol called the
Ouroboros Praos protocol. This unique consensus
mechanism functions by breaking down time into
epochs that last approximately 5 days, which are then
broken down into 432,000 slots. Nodes are selected at
random to be slot leader, which in turn are selected to
produce blocks.
Smart Contract
Smart contracts are computer programs that run
within a blockchain protocol that automatically
execute based on preset conditions. They execute a
predefined set of terms automatically in a trackable
and irreversible manner without the need for a third
party. Smart contracts are written in various types of
computer programming languages, or even in a
combination of languages. Smart contracts are
designed to solve real-world problems utilizing
computerized systems, and are currently being
developed for nearly any industry imaginable.
Smart Home
A smart home is a tech-enabled home setup in which
various functions such as heating, lighting, and
appliance configurations are automated or remotely
managed via network-connected device such as a
mobile phone or tablet. Smart home setups usually
involve the use of both hardware and software
solutions to improve occupants' convenience and
efficiency, and are one of the most widely recognized
applications of Internet of Things (IoT) technology. For
instance, an occupant's sleep tracker wearable may be
synced to a room's temperature control system, which
will then automatically adjust the room's temperature
in accordance with the occupant's sleep patterns and
personal preferences.
Smart Order Router (SOR)
Smart order routing (SOR) is an automated online
trading method which detects and executes the best
available trading opportunity throughout a given
range of financial markets and trading venues. In
essence, when implementing SOR an investor feeds a
pre-established set of conditions to a set of bots or
algorithms which then scan multiple markets using
their given criteria in order to find the optimal
environment to execute a given order. Investors
typically program the algorithms used to run SOR to
differentiate various trading venues in accordance
with common parameters such as latency levels, fee
structures, and available liquidity, as well as more
complex parameters specific to that investor's unique
trading strategy. As a result, running SOR requires
robust API integrations across different platforms in
order to effectively utilize this data-intensive,
multiplatform trading strategy.
Smart Pools (Balancer)
On the Balancer platform, Smart Pools are liquidity
pools with adjustable parameters that can be
managed via a smart contract. These pools can be
made of two-to-eight different token constants, and
can be customized with configurable weights in order
to represent the desired ratio of each token within a
given pool. In addition to customizing token mix and
weight, Smart Pool managers can also change swap
fees, select/restrict liquidity providers, set max
deposit value limits, and start/stop trading tied to
their pool. These variable parameters allow for a
hitherto unprecedented level of flexibility for liquidity
providers on Balancer.
Smart Token
Smart tokens are cryptocurrencies that can be
programmed with a near-infinite range of parameters.
The purpose of a smart token depends on the specific
parameters it was programmed with, with some smart
tokens used to help reduce liquidity risk, improve
security measures, or shape consumer behavior. For
instance, a smart token can be programmed to
dynamically adjust its value in accordance with a
Constant Reserve Rate (CRR) pegged to a different
base currency, programmed to work only with certain
vendors or when purchasing certain items, or
designed to expire after a set amount of time. The
Bancor Network's Bancor token, released in June
2017, is widely recognized as the world's first smart
token.
Smishing
Smishing is a variant of a phishing attack which
involves the use of misleading SMS or text messages
to misdirect a target into sharing sensitive information
or access. The text messages involved in a smishing
attack often contain malicious links or a fradulent
customer support or authoritative phone intended for
the target to click on or call. If a target responds to
this call to action (CTA), it will typically go on to trigger
some form of compromising activity, resulting in the
divulging of sensitive information such as one's Social
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Security Number or Credit Card details, or losing
access to one's devices.
Social Engineering
Social engineering is a broad term that encapsulates a
wide array of techniques that exploit psychological
factors – such as fear, trust, panic, lack of information,
and confusion – to compromise a target. Rather than
directly hacking a system or identifying technical
weakness in a target's devices or digital accounts,
social engineering focuses on the manipulation of
individuals to perform acts which may not be in their
best interest, such as divulging sensitive data or
inadvertently transferring funds to a malicious actor.
Social engineering tactics can also be used to gain
access to networks and devices, in which case a
malicious actor can wrest control away from the
legitimate owner to install malware in the system.
Soft Fork
A soft fork is a software update of a blockchain
network that is backward compatible, meaning that a
piece of software which has undergone a soft fork
remains interoperable with its older legacy system.
This means that nodes can continue to communicate
with nodes that have not upgraded. By contrast, if a
blockchain undergoes a hard fork, only new blocks
generated afterwards are recognized as valid. As a
result, soft forks generally entail less drastic protocol
changes than hard forks.
Software Development Kit (SDK)
A software development kit (SDK) is a specialized suite
of software development tools created in order to
enable software engineers create digital applications
and perform other useful functions. Most SDKs
include common software development tools such as
compilers, debuggers, and software frameworks,
which make it easier for developers to design and
build new software. There are a wide array of
available SDKs catering to different platforms and use
cases within the blockchain development scene and
beyond.
Software Wallet
A software wallet is a digital wallet which stores a
user's public and/or private keys, thereby securing the
user's digital assets. Since software wallets are
essentially computer programs, they are typically
locally stored in a user's desktop or mobile phone and
are remotely connected to the internet. Software
wallets are oftentimes more convenient than
hardware wallets, but are also generally more
susceptible to hacks. Common types of software
wallets include desktop wallets and mobile wallets.
When using a software wallet it is important for users
to keep devices and software up to date in order to
minimize the risk of a cybersecurity breach.
Solana (SOL)
Solana is a smart contract-enabled blockchain that
aims to natively solve many of the scaling and
throughput issues faced by other layer-1 blockchain
networks. SOL is the native token of the Solana
network, and is burned to pay for fees on the Solana
network. Solana's users can also stake SOL in order to
become a blockchain node, and the platform intends
to enable SOL to be used in Solana platform
governance in the future.
Solidity
Solidity is the software development programming
language designed specifically for Ethereum’s
blockchain framework. Solidity is an object-oriented
programming language designed for building smart
contracts that work in unison with the Ethereum
Virtual Machine (EVM) and the Ethereum network.
Solvency
Solvency is the ability of an organization to meet its
financial obligations from a regulatory and compliance
standpoint. For GUSD, this means that the amount of
USD maintained in a holding account is equivalent to
or greater than the tokens in circulation. This solvency
measure affirms that the Gemini Dollar tokens
maintain their value for both the short term and the
long term.
Spear Phishing
Spear Phishing is a variant of phishing which targets a
specific individual, organization or business. As is the
case with most phishing attacks, spear phishing
typically entails the use of misleading emails or other
forms of electronic communications. Attackers may
tailor these fraudulent communications with the
target's position within an organization in mind, or
include other contextual information to more
effectively mislead the victim. As a result, spear
phishing requires more background research on a
target than most other forms of phishing attacks.
Speculative Investment
A speculative investment entails a considerable
degree of risk of financial loss, both in terms of
principal and potential unrealized gains. However,
speculative investments are usually those with a high
potential upside, making them attractive
opportunitties for investors with a high tolerance for
risk. Many blockchain skeptics consider
cryptocurrencies a speculative investment, while
more traditional speculative investments include
investment in early-stage startups, trading options,
and certain commodities.
Spot Market
The spot market is a public financial market in which
the trade of financial instruments or commodities are
immediately settled and delivered. While the delivery
of physical goods purchased may be slightly delayed
due to real-world logistical considerations or business
protocols. However, spot market purchases are
settled at the price fixed at the point of purchase
rather than the price at the time of distribution. This
contrasts with futures markets, in which delivery is
due at a later date, and prices may fluctuate in
accordance to market movements which occur after
an exchange has been made.
Stablecoin
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A stablecoin is a digital currency created with the
intent of holding a stable value. The value of most
existing stablecoins is tied directly to a predetermined
fiat currency or tangible commodity, like Gemini dollar
(GUSD), which is pegged 1:1 to the US dollar.
However, stablecoins can also achieve price-stability
through collateralization against other
cryptocurrencies or algorithmic token supply
management. Since stablecoins do not fluctuate
significantly in price, they are designed to be used
rather than an as an investment.
Stake (eos.system)
On the EOS system, when software developers deploy
and interact with smart contracts through introduced
actions, they are backed up via other types of
resources: RAM, CPU and NET. Developers are able to
stake NET and CPU, and purchase RAM with EOS
coins.
Staking
Staking is the process through which a blockchain
network user 'stakes' or locks their cryptocurrency
assets on a network as part of the consensus
mechanism, thus ensuring the security and
functionality of the chain. Staked assets are usually
held in a validator node or crypto wallet, and in order
to encourage staking most projects reward the
holders of staked tokens with annualized financial
returns, which are typically paid out on a regular basis.
Staking is a core feature of Proof-of-Stake (PoS)
blockchain protocols, and each blockchain project
which incorporates a staking feature has its own
policies for staking requirements and withdrawal
restrictions.
Staking Pool
On a Proof-of-Stake network, staking pools allow
multiple cryptocurrency stakeholders to combine
tokens in a collective pool in order to secure the
benefits held by a larger, collectivized network stake.
By combining computational resources, the individual
stakeholders who choose to participate in a staking
pool aggregate their staking power to more effectively
verify and validate new blocks, which consequently
increases their chances of earning a portion of the
resulting block rewards.
Stalling Delay
A stalling delay is a coded, time-based technique that
certain types of malware use to bypass a network's
cybersecurity defenses. After infecting a target
system, malware with a stalling delay mechanism
typically executes a series of useless, innocuous CPU
cycles in order to delay the execution of its actual
malicious code until the target network is no longer
on alert. If the malware successfully bypasses the
security's defenses, it can then go on to execute its
malicious code with full effect.
Standard Deviation
Standard deviation is a measure of how far each
observed value in a data set is from the mean value.
This measurement indicates how spread out the data
is within a data set, and how far specific data is from
the general norm. Within the context of investing,
standard deviation can be used to compute a current
rate of return on an investment relative to its
historical mean in order to determine the
investment's historical volatility. In general, volatile
investments a characterized by a high standard
deviation, while more stable investments usually have
low standard deviations.
State Machine Replication (SMR)
State Machine Replication (SMR) is a general
approach in distributed computing for building fault-
tolerant systems. This is achieved through the
replication of servers (states or state machines) and
organization of client exchanges with server replicas.
SMR accomplishes this by deploying copies of a web
service across a set of servers rather than just one.
This approach can potentially increase a system's
performance and capacity since the replicas provide
more resources to the service, while achieving
operational fault tolerance through the elimination of
a single point of failure.
Status Network Token (SNT)
The Status Network Token is the native ERC-20 utility
token of Status Network, an open-source messaging
platform. SNT plays a key role in Status' decentralized
platform governance, as any Status community
stakeholder can use SNT to vote on network
proposals. With each vote the SNT committed is
cloned into a separate decision token that is counted.
As a result, while the amount of SNT tokens a user
holds at that time of the vote represents that user's
voting power for that decision, it does not cost any
SNT to participate.
Stellar (XLM)
Stellar is an open-source, decentralized payment
protocol that enables seamless, cross-border
transactions between all forms of currency. The
project's native token, Stellar Lumens (XLM), is used
to pay the network's transaction fees, prevent
network spam, and provide liquidity via the Stellar
Distributed Exchange (SDEX).
Stock Keeping Unit (SKU)
Stock Keeping Units (SKUs) are used in inventory
management to classify a distinct type of item for
sale. Different SKU classifications include color, size,
packing material, manufacturer, description, and
warranty terms. SKUs are used by brands,
manufacturers, warehouse staff, and retailers to
identify items as the move through a supply chain,
and to provide data points for enterprise
management systems.
Storage Miners
The Filecoin protocol relies on storage miners to
furnish its marketplace of decentralized cloud storage.
Storage miners are essentially nodes that solve
cryptographic proofs in order to verify storage across
time. These nodes must use Filecoin tokens (FIL) as
collateral to ensure that they uphold their contractual
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obligations, and in return earn additional FIL by
storing data for clients on the network. Due to the
design constraints imposed by Filecoin's Proof-of-
Replication (PoRep) and Proof-of-Spacetime
(PoSpacetime) mechanisms, storage mining requires
fairly powerful hardware to meet the network's
storage and algorithmic proof requirements.
Storage Node (STORJ)
The Storj network utilizes storage nodes to provide
bandwidth to the network and store clients' data in a
secure, decentralized format. Anyone individual or
entity with a stable internet connection and excess
hard drive space and bandwidth can set up a storage
node. Each month, node operators are compensated
via STORJ tokens valued in USD based on current
market rates.
Store of Value
A store of value is an asset that is expected to
maintain its value/purchasing power over time and
can be reliably retrieved and exchanged at a later
date. Assets that have historically been considered
reliable stores of value include fiat, real estate, and
rare metals such as gold and silver. With blockchain
technology growing increasingly mainstream, an
increasing number of people now also consider
certain cryptocurrency tokens, particularly Bitcoin
(BTC), as effective stores of value.
Storj
Storj is a blockchain-enabled data storage network
that allows users to access remote, decentralized data
storage and retrieval services, or offer storage services
by using excess hard drive space and bandwidth.
While users' files are not stored on the blockchain,
Storj uses hashing, Proof of Work (PoW), key pair
cryptography, and other blockchain features to offer
data storage services and rates which are similar to,
and in some cases superior to, what is offered by
larger centralized cloud storage services.
STRIDE
STRIDE is a threat modeling methodology used by
Crypto.com and other enterprises in order to identify
and deter potential cybersecurity threats. The word
'STRIDE' is an acronym that stands for "Spoofing,
Tampering, Repudiation, Information Disclosure,
Denial of Service, and Elevation of Privilege." Each of
these concepts is a common cybersecurity threat
category, and security experts typically use STRIDE as
a conceptual framework in order to methodically
explore various ways in which a system must be
protected to avoid being compromised.
Strike Price
A strike price is the price at which an investor can
exercise the right to buy or sell an underlying security
in an options contract. The value of the strike price is
set by financial exchanges, and may be a function of
the underlying security's spot price, which is the
market price of the security on the day the option is
taken out. For example, suppose an investor
purchases a $2 monthly call option to purchase
Bitcoin at $1,000. As a result, the strike price of this
contract is $1,000, meaning the investor can choose
to exercise their option to purchase the
cryptocurrency at this price before the month is up
and the contract expires.
Substrate
Substrate is a blockchain integration platform and
application development framework that was
designed by Parity Technologies, the creator of
blockchain interoperability pioneer Polkadot. The
purpose of Substrate is to help simplify the process of
building dApps or independent blockchains that run
on the Polkadot network. Substrate accomplishes this
by offering a fully adaptable blockchain design
framework that features software development in
numerous languages, forkless upgradability, light-
client architecture, and multifaceted development
tools. As a result, Substrate is one of the most
powerful components of the Polkadot ecosystem.
However, blockchains on the Polkadot network do not
need to be built with Substrate.
Swing Trader
Swing trading is a market trading strategy that
attempts to capture short- to medium-term gains
based off of fluctuations in the value of stocks,
commodities, and/or currencies over a few days or
weeks. In order to be effective, swing traders must
actively monitor their positions and time trades
meticulously. Their risk/reward ratio sits on the
spectrum between that of day traders and trend
traders. In most cases, swing traders typically rely on
charted technical indicators to identify viable trading
opportunities, although technical analysis is regarded
by many as an imperfect science.
Switcheo
Switcheo is a decentralized cryptocurrency exchange
on the NEO blockchain with a product focus on
transparency and convenience that allows for the
cross-chain swapping and trading of EOS, Ethereum,
and NEO coins. The project’s native token, Switcheo
Token (SWTH), is a NEP-5 standard digital currency
that can be used on the Switcheo network for trading
discounts, as well as for access to several exclusive
offerings and services. SWTH was upgraded in
October 2020 under a revised monetary policy smart
contract.
Symmetric Encryption
Symmetric encryption is a form of encryption which
uses the same key to both encrypt and decrypt
electronic information. Both entities communicating
via symmetric encryption must have identical copies
of this key, which should be kept secret and not
shared with anyone in order to preserve the security
of their interactions. By contrast, asymmetric
encryption utilizes two keys—a public key to encrypt
information, and a private key to decrypt information.
Synthetic Asset
A synthetic asset is a financial instrument that derives
its value from another asset, thereby achieving the
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same financial effect as the ownership of that asset.
Because the value of a synthetic asset is a function of
another asset, synthetic assets are considered
derivatives, and synthetic assets have been created to
mimic a broad range of securities, commodities, and
assets in global financial markets, the cryptocurrency
sector, and beyond. Synthetic assets typically allow
traders to take a position in an asset without actually
needing to expend the capital to directly buy or sell
that asset, which has led to the global proliferation of
derivative markets for trading synthetic assets.
Synthetix (SNX)
Synthetix is a token trading platform built on
Ethereum that allows users to exchange tokenized
representations and derivatives of cryptocurrencies,
stocks, currencies, precious metals, and other assets
in the form of ERC-20 tokens. This is accomplished
through Synthetix' dual-token model, whereby users
stake the platform's main token, Synthetix Network
Tokens (SNX), as collateral in order to create new
synthetic assets. These 'Synths' are designed to track a
metric, usually price, of a real-world asset, thereby
allowing users to invest in the asset without actually
holding it, much like derivatives. Synthetix preceded
Universal Market Access (UMA), which is also built on
Ethereum and was launched to achieve a similar
purpose.
T
T-Addresses
On the Zcash blockchain, t-addresses are public
addresses that offer similar transparency levels as a
standard Bitcoin (BTC) address. By contrast, z-
addresses are fully private addressess that utilize zero-
knowledge proof systems to shield address
transactions and balances. Zcash's dual-address setup
was designed in order to empower users to decide
whether to opt for anonymized or publicy viewable
transactions, while transactions can be sent freely
across the different address types.
Tailgating (or Piggybacking)
Tailgating attacks, also known as 'piggybacking', is a
form of rudimentary data breach that typically entails
an unauthorized individual following an authorized
individual into a secured building or area. In most
instances, the perpetrator of a tailgating attack is
attempting to access sensitive information or carry
out some other malicious act once on the premises.
While this attack is low-tech and seemingly
straightforward, it is nonetheless a widespread
security breach with potentially catastrophic
consequences.
Tardigrade (STORJ)
Storj approaches its decentralized data storage
ecosystem by bifurcating its product into the supply
and demand sides of the market. Tardigrade is a
division powered by Storj Labs which focuses on the
demand side of the business. In order to make it as
easy as possible for anyone to buy decentralized
storage on Storj, Tardigrade was formed to handle all
issues relating to the platform's customers,
developers, and partnerships. Storj itself, on the other
hand, is tasked with managing the platform's storage
node operators, tokenomics, and community.
tBTC
tBTC is a decentralized and trustless system for
wrapping Bitcoin on the Ethereum network developed
by the Cross-Chain Group. Each tBTC token is an ERC-
20 token redeemable for bitcoin (BTC) at a 1:1 ratio,
with a total supply that is also pegged to the total
supply of BTC. tBTC allows users to deposit and mint
Bitcoin tokens on the Ethereum network without a
middleman, thereby enabling users to incorporate
Bitcoin into the decentralized finance ecosystem.
TBTC Deposit Token (TDT)
The TBTC Deposit Token (TDT) is a non-fungible token
used in the tBTC mechanism as the medium of
exchange between tBTC and BTC tokens as the
wrapping takes place. New TDT is minted whenever a
user requests a deposit to convert BTC to tBTC, and
burned whenever tBTC is exchanged for tBTC.
Technical Indicators
A technical indicator is a specific mathematical
heuristic or pattern-based signal based on the historic
price, volume, and/or open interest of a security or
contract. Technical indicators are commonly used by
traders to predict future price movements, and
constitute a fundamental component of technical
analysis.
Technical Resistance Level
Within the context of technical analysis, a resistance
level is a specific price point at which a stock or other
security has exhibited difficulty maintaining or
surpassing in the past. As a result, once the price of a
security reaches or nears an established resistance
level once again, price movement can often stall or
reverse. Different traders use different forms of
technical analysis and different time frames to
determine specific resistance levels. In many cases,
commonly recognized technical indicators that
suggest that a stock has neared its resistance level can
trigger a self-fulfilling prophecy whereby traders
attempt to front-run the market by selling the security
in anticipation of a trend reversal.
Tendermint Core BFT Consensus
Tendermint Core BFT Consensus is a language-
agnostic consensus method designed by the
Tendermint team to be a more scalable, secure, and
decentralized version of the PBFT, SMR and DLS
algorithms. As a result, Tendermint Core supports
state machines written in any programming language,
enables fast finality rates, and can tolerate up to a
third of its constituent nodes failing abritrarily before
the network's performance is significantly affected.
This consensus engine was used to construct
numerous noteworthy blockchains, including the
Crypto.com blockchain platform and the protocol for
Binance DEX.
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Testnet
A testnet is a sandbox or testing environment for a
blockchain network typically made available for
development purposes prior to a mainnet launch.
Testnets are commonly used to ensure that the
blockchain system is adequately secure and functional
in accordance with its intended design. Once the
testnet has been audited and pressure-tested,
developers often fix bugs or add new features to the
project's mainnet prior to launch. Testnets are
generally not meant to be directly converted into
mainnets, so they are usually unable to broadcast or
verify network transactions in the same way that a
mainnet system is able.
Tezos (XTZ)
Tezos is a Proof-of-Stake blockchain platform that
provides a decentralized, global computer on which
developers can build decentralized applications
(DApps). XTZ is the native token of the Tezos network,
used for paying transaction fees on the network,
staking, and earning rewards.
The DAO
The DAO was a decentralized autonomous
organization that was launched in 2016 on the
Ethereum blockchain. The DAO was designed to be an
investor-directed cryptocurrency venture capital fund,
but after raising $150 million worth of ETH through an
initial token sale, the project was hacked, resulting in
the loss of millions of dollars' worth of ether. The
incident hack is notable in the crypto space as it led to
a schism within the Ethereum community that
resulted in a hard fork of Ethereum into Ethereum
(ETH) and Ethereum Classic (ETC).
The Gold Standard
Money linked to the value of physical commodities
like gold and silver utilizes the gold standard. The gold
standard formed the basis of the international
currency market until the 20th century. But in 1971,
the system came to an end when the U.S. halted the
direct conversion of US dollars into gold.
Third-Party Storage
Third-party storage refers to a physical or digital
storage solution provided and managed by an outside
entity such as a bank, centralized cryptocurrency
exchange, or Amazon Web Services.
Timestamp
A timestamp is a digital record or log used to identify
the moment in time that a transaction occurred.
Timestamps recorded onto a blockchain's ledger are
immutable and unique to the specific transaction the
timestamp is recording.
Time-Weighted Average Price (TWAP)
Time-weighted average price (TWAP) is a trading
algorithm that is based on the weighted average price
of a financial asset over a specified time frame. High-
volume traders often use a financial asset's TWAP to
spread a large order across numerous smaller orders
valued at the TWAP price. This is done in order to
avoid abrupty increasing the value of the financial
asset due to a sudden, single high-volume order.
Timing-Based Evasion
Timing-based evasion is a tactic some variants of
malware use to avoid detection within a target
system. Malware coded with a timing-based evasion
tactic will only execute its malicious code at certain
moments, like when detection levels are deemed low
or in response to pre-defined actions taken by the
system user, like exiting a program or pressing a
certain key.
Token
Within the context of blockchain technology, a token
generally refers to a unit of value for a programmable
asset that is managed by a smart contract and an
underlying distributed ledger. Tokens are the primary
means of transfering and storing value on a blockchain
network—most often Ethereum. Tokens can also be
designed to be either fungible or non-fungible,
depending on a network's specific needs. And while
many tokens are primarily used for simple
transactions, an increasing number of blockchain
projects are designing tokens encoded with a variety
of wide-ranging use cases, primarily in regards to on-
chain governance and network maintenance.
Tokenization
Tokenization is the act of converting the value of a
tangible or intangible asset into a token. The token
itself is a piece of code made up of a distinctive asset
reference, unique properties, and/or specific legal
rights in accordance with the smart contract through
which the token was generated. Once tokenized, an
asset can be freely transferred, exchanged, or stored
away in accordance with whatever digital platform(s)
or marketplace(s) the asset's token was designed to
be compatible with. Through tokenization, nearly any
asset can be seamlessly integrated into the rapidly
expanding ecosystem of blockchain networks and
digital finance writ large.
Tokenization Standard
Tokenization standard refers to the specific technical
architecture of a network's blockchain protocol, which
in turn determines the nature of the tokens that are
compatible with that network. In the years since
blockchain technology was first introduced, several
token standards have gained prominence, with ERC-
20 tokens on theEthereum network leading the pack
in terms of ubiquity and adoption. Tokenization
standards can also be spun off to create new
standards which exist within the same token standard
family. For instance, security tokens (ERC-1400) and
NFTs (ERC-721) are two distinct tokenization
standards based on Ethereum.
Tokenized Representation
Tokenized representation takes place when a digital
asset is locked up with a custodian, who then mints a
one-to-one representation of that token on another
chain. Within the context of the Ren Virtual Machine,
the custodian involved in this process is a
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decentralized "Darknode" instead of a centralized
authority. By locking an asset up in a Darknode until a
user wishes to redeem it, Ren users are able to
complete this asset converstion process in a trustless
yet secure fashion.
Tokenomics
Tokenomics, a portmanteau of “token” and
“economics,” refers to the underlying attributes of a
cryptocurrency token that incentivize users to adopt
the token’s project ecosystem. Among cryptocurrency
investors, the term is commonly referred to in terms
of how the token is utilized within the project
ecosystem, or how the token will follow a monetary
policy as the project develops. Therefore, the term
tokenomics encapsulates a variety of processes and
concepts, some of which are hard-coded into a
blockchain's protocol, and others which are more
speculative in nature.
ToolChain
A ToolChain is a set of software programming tools
designed to simplify complex software development
tasks, or to help create specific types of software
programs and applications. This general term should
not be confused with Vechain's ToolChain, which is a
Blockchain-as-a-Service (BaaS) offering tailored for
enterprise use.
Total Value Locked
Total Value Locked (TVL) refers to the aggregate value
of all the assets locked in the smart contracts of a
particular decentralized blockchain protocol.
Traceability
Traceability refers to the degree to which a third party
is able to track the details of a transaction, such as the
transaction amount or the identities of the involved
parties. Blockchain-based project approach traceabilty
in different ways. For example, non-fungible tokens
following the ERC-721 standard are created to
maximize traceability, while projects like Monero have
designed systems that obfuscate user accounts and
transactions from external viewers in an attempt to
remain completely untraceable.
Trading Bots
Trading bots are applications that execute trades
automatically within pre-configured parameters and
environments. Trading bots are widely used by
quantitative traders, market speculators, and other
financial market participants. The specific parameters
each trading bot is set to can be configured in
accordance with its operator's personal trading
strategy and proclivities.
Trading Volume
Within the context of capital markets, trading volume
refers to the amount of a security traded over a given
time frame. Trading volume is typically reported as
the number of shares that changed hands during a
given trading session or other period of time. The
trading volume for every openly tradeable asset is
constantly changing, and the direction and magnitude
of these shifts are important variables which most
investors factor into their analysis.
Transaction Cost Analysis (TCA)
Transaction Cost Analysis (TCA) is a system used by
institutional investors to study price trends in order to
determine favorable trading windows. This metric is
calculated in accordance with a specified time period
and with respect to various benchmarks.
Transaction Fee
Transaction fees are the fees charged to execute a
transaction on a blockchain, and are typically charged
to the sender. Transaction fees are required to pay for
the computational power a network must exert to
broadcast and send a transaction. Transaction fees,
which can be paid out through various mechanisms to
entities that furnish a blockchain network’s
transactional capacity, are a key aspect of incentive
models for most networks, including Bitcoin and the
current iteration of Ethereum (1.0), upon which the
fee is called “gas.” Transaction fees are charged every
time a person participating in the network sends a
cryptocurrency or specific type of data from one
recipient to another. Transaction fees vary with each
blockchain and often fluctuate according to the total
transaction volume currently taking place on a
network.
Transaction ID
A transaction ID, or transaction hash, is an immutable
record of a digital transaction that’s been recorded
onto a blockchain ledger. Users are able to look up
any past transactions using its corresponding
transaction ID, typically with the help of a blockchain
explorer. In some instances, a cryptocurrency
recipient may request the transaction ID from the
alleged sender in order to verify that the transaction's
origination point.
Transaction Settlement Time
A transaction's settlement time refers to the elapsed
time between when a transaction is initiated and
when assets are deposited in the recipient's account
after all relevant financial institutions and/or
algorithmic protocols confirm the transaction as valid.
The length of settlement times vary widely depending
on the structure of the different networks and
organizations that process the transaction.
Transactions Per Second
Transactions per second (TPS) refers to the number of
data transactions that a computer network can exact
within a second. The TPS measurement used for
sending data on a blockchain network is often an
indicator of the protocol’s overall network speed and
scalability, and measures how quickly a specific
platform can send data like cryptocurrency
transactions and the execution of smart contract
functions. Highly scalable networks with high
transaction speeds are a requirement for the
widespread adoption of blockchain technology.
Transmission Control Protocol/Internet Protocol
(TCP/IP)
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The Transmission Control Protocol/Internet Protocol
(TCP/IP) is an organized suite of communication
protocols that is used to connect network devices
over the internet and transmit data through these
connections. The Internet as we know it was largely
designed and built upon TCP/IP, although this set of
protocols can also be similarly used as a
communications protocol within a private computer
network.
Trapdoor Function
Within the field of cryprography, a trapdoor function,
also known as a "one-way function", is an algorithmic
puzzle that is simple to compute in one direction, but
extremely difficult to solve when taking the inverse
approach. This unique feature makes trapdoor
functions an invaluable design component that is
embedded into a broad range of encrypted messages
and cryptographic transactions.
TRC-20 Token
TRC-20 is a smart contract standard for creating
tokens using the TRON Virtual Machine. TRC-20
tokens are fully compatible with Ethereum’s ERC-20
standard.
Treasury Bills (T-Bills)
Treasury bills (T-bills) are a short-term financial
instrument issued by the U.S. government. These
fixed-income securities generally have a maturity
period lasting four weeks up to a year. Due to their
short duration, T-bills do not compensate investors via
regular interest payments. Instead, T-bills are sold at a
discount to their face value at the point of purchase,
and investors recieve the full face value amount once
the T-bill reaches maturity.
Treasury Bonds (T-Bonds)
Treasury bonds (T-bonds) are securities that the U.S.
government typically issues as a debt instrument to
fund various government operations and
commitments. These securities typically have
maturities of more than 20-30 years, and pay a fixed
return every six months. Generally speaking, the
longer the maturity period of a T-bond, the higher its
annual yield. Once a T-bond has been sold by the
government in a initial auction, it can be freely traded
in the secondary markets.
Tribute to Talk
Tribute to Talk is a feature that blockchain-enabled
messaging platform Status created in order to prevent
malicious activity and spam from cluttering its
network. Status users can set a Tribute-to-Talk
requirement, which is the minimum amount of Status
Network Token (SNT) a non-whitelisted user needs to
stake in order to send them a message. If the message
recipient responds to the sender's message, the
sender's staked SNT is sent to the recipient. If the
sender's message is ignored or rejected, the sender's
staked SNT is returned to them and they will be
unable to attempt to contact the recipient for a period
of time.
Trojan
Within the context of cybersecurity, a Trojan describes
any type of malware which disguises its true intent in
order to gain unauthorized access to a target device or
network. In most cases, trojans are designed to look
like an innocuous program or are discretely attached
to another piece of software a target is likely to install.
Once a trojan has infiltrated its target it is free to
execute its malicious code, which in most cases will
damage, steal from, or otherwise disrupt the target
device or network.
Trojan Bankers
A Banker Trojan is a specific type of Trojan malware
that is designed to gain unauthorized access to
confidential information or assets stored in online
banking systems.
Trojan Downloader
A Trojan Downloader is a specific type of Trojan
malware that lays dormant inside an infected device
until an Internet connection becomes available. From
there, the trojan downloader will connect to a remote
server or website and download additional unwanted
programs onto the infected device.
Trojan-Ransom Malware
Ransomware Trojans are a specific type of Trojan
malware designed to extort a victim after
compromising the victim's device. In most cases,
ransomware trojans will demand a payment in
exchange for undoing the damage the Trojan has
inflicted to the victim's device. However, some forms
of ransomware trojans may demand other forms of
payment, like sensitive information or performing
specific acts.
TRON
Tron is a blockchain project dedicated to building the
infrastructure for a decentralized Internet. While the
project initially started as a decentralized
entertainment platform with distributed storage
technology, the project's ambitions have grown to
closely resemble those of Ethereum. The Tron
network's native token, TRONix (TRX), is used as a
payment method across Tron's evolving service
ecosystem.
TRONix (TRX)
TRONix (TRX) is the native token of the Tron
blockchain protocol. While the token was initially used
only to pay content creators for digital content on the
Tron platform, TRX has evolved into a more broadly
accepted payment method across Tron's evolving
service ecosystem.
TRON Virtual Machine (TVM)
The TRON Virtual Machine (TVM) is a Turing complete
virtual machine that provides a feature-rich and user-
friendly environment for developers to build and test
decentralized applications (dApps) and other web
services within the Tron ecosystem. TVM is Tron's
equivalent of the Ethereum Virtual Machine (EVM),
and all software projects created through TVM are
fully compatible with EVM.
TRONZ
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TRONZ is a smart contract privacy protocol that was
introduced with TRON 4.0 in July 2020. TRONZ is built
upon the zk-SNARK methodology, the core privacy
technology of Zcash (ZEC). TRONZA gives users more
flexible transaction privacy settings, which can be
adjusted in accordance to the user's situational needs.
Troy Ounce
The troy ounce is the global standard for measuring
the weight and implied purity of precious metals. One
troy ounce is equal to approximately 31.1 grams, in
contrast to the standard ounce which is 28.35 grams,
and this unit of measure is commonly abbreviated as
either “t oz” or “oz t”.
Trust Company
A Trust Company is a legal entity that acts as a
fiduciary, agent, or trustee on behalf of an individual
or organization. These companies are typically
charged with holding assets that it does not own on
behalf of a client, and responsibly managing those
assets until they are required by law to be transferred
to a specified beneficiary party. Since trust companies
are fiduciaries, they have a legally binding
responsibility to act on behalf of their clients' financial
interests.
Trusted Execution Environment (TEE)
A Trusted Execution Environment (TEE) is an isolated
environment within a device's main processor that
allows for the secure and private execution of code
without the risk of interference from the rest of the
device or system. Only properly authorized code can
be executed within a TEE, which utilize use both
hardware and software to protect data and code from
the external environment. Furthermore, the different
trusted applications within a TEE are protected from
each other via software and cryptographic solutions,
and these trusted applications have full access to the
device's main processor and memory. TEEs are
generally used to improve the overall security of a
device or network and ensure that certain core
processes can operate with full reliability and integrity
without the risk of being compromised.
Trustless
When a system is trustless within a peer-to-peer (P2P)
blockchain network, it means that all participants in
the network do not need to know or rely upon
verification from one another or a third party. This
means that the system is run autonomously by the
underlying technical architecture and consensus
mechanism of the blockchain protocol itself.
Transacting on a shared, trustless network is not
beholden to a central organization to ensure trust,
and is a key value proposition of blockchain
technology. A number of innovations underlay the
trustless nature of blockchain networks, including
immutability, decentralization, transparency,
censorship resistance, and neutrality.
Turnkey Solution
A turnkey is a product or service that can be sold to
any applicable buyer as a complete, ready-for-use
product without the need for user customization.
Turnkey solutions therefore differ from a built-to-
order products, which are designed in accordance to a
customer’s unique specifications.
Two-Factor Authentication (2FA)
Two-factor authentication (2FA) is an extra layer of
security for user accounts. In its most common form,
2FA requires a user to further verify identity after
entering the account password. This additional
verification is typically achieved by inputting a
randomized code generated through a secondary
device or program. As a result, 2FA mitigates a variety
of cybersecurity risks stemming from both device
hacks and human error.
U September 1, 2020. This first round distribution
UMA Improvement Proposal (UMIP)
UMA Improvement Proposal (UMIP) refers to the
document used to propose changes to the UMA
ecosystem. UMA token holders can use UMIPs to
propose and approve new financial contract
templates, new price identifiers, and other
governance changes to UMA's data verification
mechanism.
UMA Token
The UMA token is the native governance token of the
UMA network. UMA users are able to use UMA tokens
to vote on how to resolve price disputes that occur on
the network as part of its data verification
mechanism, and make changes to the mechanism via
the UMA Improvement Proposal (UMIP) governance
process.
Unbanked
The 'unbanked' refers to individuals without access to
the traditional banking system and modern-day
financial services. Most individuals who are
considered 'unbanked' lack a stable internet
connection and/or reside in an underserved
community or developing country. As a result, these
individuals are effectively excluded from participating
in the global economy. It is a primary goal of sectors
like finTech, DeFi, and blockchain to support the
unbanked by achieving equitable financial inclusion
globally.
Uniswap (UNI)
Uniswap is a decentralized exchange (DEX) that uses
liquidity pools (LPs) to make markets without the
need for order books or central facilitators. Uniswap is
underpinned by smart contracts that facilitate token
swaps and provide the incentive structure for liquidity
providers to participate in the system. As one of the
first automated market makers (AMMs) to go live on
the Ethereum network, Uniswap has made significant
strides in proving that AMMs can be an effective tool
for trading digital assets in a decentralized and
permissionless way.
Unit of Account
A unit of account is a standard unit of measurement
of the value of a good or service. By attributing a
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specific measurement unit to a good or service, the
monetary value of that offering can be clearly
understood in abstract terms without the need to
resort to bartering. The need for units of account to
optimize market transactions is one of the three
fundamental functions of money, the other two being
usability as a store of value and a medium of
exchange.
UNI Token
UNI token (UNI) is the native governance token of the
Uniswap Protocol, a decentralized cryprocurrency
exchange (DEX). The token was initally released on
September 2020, when Uniswap airdropped 400
tokens into each unique cryptocurrency address that
had ever interacted with Uniswap Protocol prior to
reached ~50,000 Ethereum addresses, immediately
making UNI one of the most widely distributed tokens
within the cryptocurrency space. In total, 60% of UNI's
genesis supply is intended to go to the community,
while the remaining 40% have been allocated to
Uniswap team members, investors, and advisors.
Universal Market Access (UMA)
Universal Market Access (UMA) is a specialized
protocol built on Ethereum that allows users to create
custom synthetic cryptocurrency tokens. Synthetic
tokens are collateralized by another asset, while
reflecting that asset's price in real time. Essentially any
type of asset, both physical and digital, can be
tokenized via UMA and integrated into the rapidly
evolving ecosystem of blockchain-enabled
decentralized finance (DeFi).
Unspent Transaction Output (UTXO)
A Unspent Transaction Output (UTXO) is the amount
of cryptocurrency that remains after a transaction is
executed. Each UTXO represents a chain of ownership,
which is represented as a chain of digital signatures in
which a transaction originator signs a message
transferring ownership of their UTXO to the recipient's
public key. As a result, UTXOs are responsible for
beginning and ending each cryptocurrency
transaction.
U.S. Financial Crimes Enforcement Network
The Financial Crimes Enforcement Network is a
division of the U.S. Department of the Treasury that is
tasked with gathering and assessing information
about financial transactions. The goal of the U.S.
Financial Crimes Enforcement Network is to prevent
and solve financial crimes.
Utility Token
A utility token is a tokenized digital asset designed to
grant its holder access to the products or services of a
blockchain protocol. As a result, utility tokens are
intended to be used within the blockchain's network,
rather than serve as an investment. However, given
that most utility tokens fluctuate in value in
accordance with its network's perceived popularity
and adoption, many traders and crypto enthusiasts
nonetheless purchase certain utility tokens as
speculative investments.
V VRFs have a wide range of use cases across various
Validator
Within the context of blockchain technology, a
validator is an entity responsible for verifying and
approving transactions submitted by users and/or
blockchain clients. Each blockchain protocol has its
own parameters for what constitutes an acceptable
validator and how these validators operate. Most
decentralized blockchain networks rely on some form
of validator node to process on-chain transactions in a
permissionless and distributed manner.
Value Investing
Value investing is an investment strategy that involves
identifying stocks and other securities that appear to
be trading for less than their intrinsic value. Value
investors typically conduct thorough due diligence on
the securities they are interested in tracking and
adhere to longer investment holding periods. As a
result, these investors tend to ignore price
movements that do not appear to correspond with a
company's long-term fundamentals, such as sudden
reactions to wider industry news or short-term market
events
VeChain Improvement Proposals (VIPs)
VeChain Improvement Proposals (VIPs) are the design
documents VeChain ecosystem participants and
community members use to propose changes to
VeChain's protocol and development trajectory. There
are four main types of VIPs: application, interface,
information, and core. Once a VIP is proposed, the
VIP's author is responsible for building consensus
within the community and documenting dissenting
opinions.
VeChain Token (VET)
VeChain Token (VET) is the native governance and
utility token that underpins the VeChainThor
blockchain network and overall VeChain ecosystem.
VET holders can contribute to the security and
consensus of the network by holding VET within
different nodes within the VeChainThor blockchain
(AM’s, XN’s, EN’s).
Verifiable Random Function (VRF)
A Verifiable Random Function is a cryptographic
primitive that was conceived of in 1999 and has many
useful applications including deterministic
precommitments and having output that is resistant
to preimage attacks. In implementation a VRF consists
of three related algorithms that do the following:
Key Generation: A mathematical function that when
given a random input produces a verification key /
secret key pair
Evaluation: This function takes a message and the
generated secret key to produce a pseudorandom
output, and an associated proof
Verification: This function uses the verification key
and other values to guarantee that the output of the
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Evaluation function could only have been produced by
someone who had the associated secret key - all
without that secret key ever having to be revealed
cryptographic schemes, protocols, and systems.
Vertical Scalability
Vertical scalability refers to a network or device's
ability to increase its existing hardware or software
capacities by adding supplementary resources. The
most common forms of vertical scalability entail
adding more RAM or processing power to a device.
However, vertical scalability can be accomplished in a
variety of ways, depending on the configuration of the
network/device and the nature of the intended
upgrade.
Vesting
Within the context of blockchain technology, vesting
is the process of releasing tokens that have been set
aside for a specified period of time. These tokens are
typically designated for a blockchain project's team,
partners, and other contributors who are actively
helping develop the project. Funds that have been set
aside for this purpose are usually locked a certain
period of time by smart contracts, which effectively
seal off access to the tokens until pre-set conditions
are met.
VeThor (VTHO)
VeThor (VTHO) coins are used to power the Vechain
network. New VTHO coins are continuously generated
for VET coin holders each time a new block is created.
A new block is typically added to Vechain's ledger
once every 10 seconds, and each VET generates
0.00000005 VTHO per new block, which translates to
approximately 0.000432 VTHO generated per VET per
day. VET holders can increase the VTHO generation
rate of their VET coins by placing their coins in
different nodes, which are tiered in accordance with
their staking requirements. VeChain’s economic
model is designed to prevent transaction fees from
fluctuating in relation to the price of VET, thus
ensuring transaction fee consistency and
predictability.
Virtual Commodities Association (VCA)
Founded in 2018, the Virtual Commodities Association
(VCA) is a non-profit organization working towards the
goal of establishing an industry-sponsored, self-
regulatory organization for the U.S. virtual currency
industry. The organization began as a committee to
explore ways of ensuring consumer protection and
market integrity in virtual commodity marketplaces,
and has since evolved into a more formalized
organization spread across six committees and
overseen by a Board of Directors.
Virtual Machine (VM)
A Virtual Machine (VM) is a cloud-based emulation of
a computer system that provides the functionality of a
physical computer system. VMs may be made to
emulate types of specialized hardware, software, or a
combination of the two, and provide the framework
for data transactions and transactional execution on
blockchain networks. The most well-known VM in the
blockchain industry is the Ethereum Virtual Machine
(EVM).
Vishing
Vishing is a variant of phishing attack that relies on
fraudulent phone calls or voice messages to mislead a
target into divulging personal information, like
account passwords or credit card details. In most
instances, a malicious actor using vishing will pretend
to be from a reputable company or a trusted
authority, and their message will often either involve
the offer of a "free prize" or a fictional crisis that the
target must tend to immediately.
Vitalik Buterin
Vitalik Buterin is a Russian-Canadian programmer and
writer most famously known for co-founding
Ethereum. In 2013, Buterin published a whitepaper
proposing Ethereum as a world computer capable of
hosting a wide range of decentralized applications
(dApps). In contrat to Bitcoin (BTC) — which is more
geared towards payments and serving as store of
value — Ethereum was intended to serve as a “Swiss-
army knife protocol,” with more flexible and wide-
ranging applications. Buterin went on to collaborate
with several other co-founders to develop Ethereum,
which was launched in 2015. To date, Buterin is
regarded by many crypto enthusiasts as the de facto
figurehead of Ethereum.
Volatility
Within a marketplace context, volatility refers to the
degree of variation an asset's trading prices undergo
relative to its mean price over a certain period of
time. The more volatile the price of an asset is, the
greater the frequency and number of its price
changes. This volatility is usually measured using
standard deviations of logarithmic returns. Many
investors track an asset's volatility in order to identity
and capitalize on trading opportunities based on
perceived price trends. However, excessive and
unpredictable price volatility often deters investors
who have a lower risk tolerance.
Volume Weighted Average Price (VWAP)
In technical analysis, volume weighted average price
(VWAP) is a benchmark that calculates the average
price at which a security has traded throughout the
day, based on both volume and price. By
automatically averaging the intraday closing prices of
a security ove time, VWAP is able to serve as a guide
for identifying various support and resistance levels.
This makes VWAP an important intraday indicator for
traders who rely on technical indicators to more
effectively time when to enter and exit their positions.
W Wood, the former CTO and co-founder of Ethereum,
WabiSabi
WabiSabi is an anonymous credential scheme that will
be introduced in the Wasabi Wallet 2.0 upgrade of
CoinJoin. WabiSabi is designed help facilitate faster,
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more cost-efficient collaborative transactions,
establish a more automated, frictionless payment
framework within CoinJoins, and potentially enable
Wasabi Wallet to more seamlessly integrate with
other technologies.
Wallet
A cryptocurrency wallet is a device or service that
stores users' public and private keys, allowing them to
interact with various blockchains and to send and
receive crypto assets. Wallets can be digital (software)
or physical (hardware), hot (connected to the
internet) or cold (disconnected from the internet),
custodial (a trusted third party has control of a user’s
private keys) or non-custodial (only the user controls
their private keys).
WannaCry Ransomware
WannaCry (also referred to as WCry, WanaCrypt0r,
and Wana Decrypt0r 2.0.) was a ransomware worm
deployed in 2017 that targeted vulnerabilities in the
Windows operating system, encrypted files on
infected devices' hard drives, and demanded a ransom
payment in Bitcoin (BTC) in order to decrypt the files.
The malware rapidly spread through multiple
computer networks and impacted users in over 150
countries, resulting in billions of dollars worth of
damages and ransom payments.
Watchdog Organization
A watchdog organization is an entity, often non-profit,
that monitors the activities of a government or
industry with the goal of ensuring that the
government or industry does not behave illegally or
unethically. Watchdogs alert the public when they
have uncovered such behavior.
Watcher
Within the OMG Network, a watcher is a computer
that monitors the network for unusual and malicious
activity and ensures that data submitted to the
Ethereum blockchain for finalization is correct. OMG
Network’s network of watchers is decentralized and
any OMG Network user can operate a watcher.
Web 3.0
The term Web 3.0 refers to a vision of the third
generation of computing, which anticipates that
technologies like blockchain will decentralize the
internet and disintermediate web 2.0 companies like
Facebook, enable the online exchange of value, and
allow users to own their data.
Web3 Foundation
The Web3 Foundation is a Switzerland-based
foundation dedicated to the advancement of Web3
technologies. Web3 is envisioned as the next era in
computing which will be focused on the
decentralization of the web, the online exchange of
value, and users owning their data. Founded by Gavin
Web3 publishes research on cryptography and other
blockchain-related fields and provides grants for
web3-focused startups and blockchain projects. The
Polkadot blockchain is one such project.
Web Application
A web application is is an application software or
program that runs on a web server rather than a
device's operating system. Web applications are
accessible through a web browser with an internet
connection and play a central role in defining online
user experiences.
Web Application Firewall (WAF)
A web application firewall (WAF) is a specific type of
application firewall that filters, monitors, and blocks
HTTP traffic to and from a specified web service. A
WAF sits between external users and web applications
and plays a crucial role in securing business-critical
web applications and web servers from application-
layer attacks. WAFs different from network firewalls,
which provide a barrier between external and internal
network traffic and are therefore designed to protect
a secured local-area network (LAN) from unauthorized
access.
WebAssembly (WASM)
WebAssembly (WASM) is a format for computer
programs which allows for high-performance
applications in web browsers.
Web of Trust
Within the Status Network, the Web of Trust is an
decentralized reputation system in which users
deposit tokens against usernames to indicate that
they trust the user.
Web Socket
WebSocket is a computer communications protocol
which enables two-way, interactive communication
between a web browser or other client and a server.
Web Wallet
A web wallet is a cryptocurrency wallet that is
accessed via a web browser. Many web wallets are
custodial services run by cryptocurrency exchanges.
Web wallets are considered 'hot wallets' because they
are connected to the internet.
Whale
In the context of the blockchain industry, a whale is an
investor who possesses a large enough quantity of a
cryptocurrency to influence its price.
Whitelabel Product
A whitelabel product is a product or service which is
produced by one entity but rebranded by another
entity to make it appear as if they had made it.
Whitepaper
A whitepaper is a document produced by blockchain
projects which outlines the purpose of the technology
they propose to create or have created, and describes
how the technology will be implemented, typically in
technical terms. Whitepapers are often released when
projects are in their early stages and are seeking
funding, though they may be updated as the projects
progress.
Window Proof of Spacetime (WindowPoSpacetime)
Within the Filecoin network, Window Proof of
Spacetime (WindowPoSpacetime) is a specialized type
of cryptographic proof which plays a central role in
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verifying data on the Filecoin network under the
Proof-of-Spacetime (PoSpacetime) consensus
algorithm. Via WindowPoSpacetime, commitments
made by storage miners are audited in 24-hour period
increments, which results in a zk-SNARK-compressed
proof being published to the Filecoin blockchain.
Withdrawal Allowlists
Withdrawal allowlists are an optional layer of security
in cryptocurrency exchange accounts which allow
users to establish a list of approved cryptocurrency
addresses and to restrict withdrawals to those
addresses only.
Worldwide Asset eXchange (WAX)
The Worldwide Asset eXchange (WAX) is a blockchain-
based marketplace for physical and virtual items,
including non-fungible tokens (NFTs) and video games.
World Wide Web Consortium (W3C)
The World Wide Web Consortium (W3C) is an
international standards organization for the World
Wide Web. W3C has over 400 members which
collectively develop web standards in tandem with the
public and W3C's full-time staff. Additionally, W3C
builds software, educational tools, and other services
to facilitate an open forum for discussion about the
internet.
Wrapped Bitcoin (wBTC)
Wrapped Bitcoin (wBTC) is an ERC-20 token which
represents Bitcoin (BTC) at a 1:1 ratio. wBTC was
jointly created by Bitgo, Kyber Network, and Ren, and
was intended to bring more liquidity to the Ethereum
ecosystem, particularly to decentralized finance (DeFi)
applications.
Wrapped Nexus Mutual (wNXM)
Wrapped Nexus Mutual (wNXM) is a one-to-one ERC-
20 representation of the Nexus Mutual token (NXM),
which is the native token of the Nexus Mutual
platform, a decentralized alternative to insurance.
While NXM can only be held by members of Nexus
Mutual, wNXM can be owned by anyone with an
Ethereum address.
X
x86 (QTUM)
x86 is Qtum’s virtual machine which was developed in
Intel's x86 machine language. x86 allows developers
to write smart contracts in a variety of languages
including C, C++, Rust, and Python. Qtum previously
utilized the Ethereum Virtual Machine (EVM) and the
Solidity programming language.
XBT
XBT is an alternative ticker symbol for BTC used by
some exchanges. Its format is derived from a currency
code standard created by the International
Organization for Standardization (ISO) which
stipulates that supranational currency codes should
begin with 'X'.
XEM
XEM is the native token of the NEM blockchain and is
used for payments on the network. Additionally, users
most hold XEM to participate in NEM's consensus
process. NEM utilizes a Proof-of-Importance (POI)
algorithm for consensus, which determines who may
produce a block through a calculation of a user's
relative importance to the network. Users' relative
importance score is based on the number XEM tokens
they hold, in addition to the number of transactions
that have been made to and from the user's NEM
wallet. Users with high importance scores are more
likely to produce blocks.
XRP
XRP is the native coin of the Ripple Ledger Network. It
is designed to be a medium of exchange and value
transfer, and is intended to be used as a low cost
bridge between fiat currencies for a broad range of
global transactions.
XYM
XYM is the native cryptocurrency of the Symbol
blockchain and is due to be launched in January 2021.
XYM will be used to pay for transactions on the
network. In order to obtain XYM, qualifying XEM
holders—holders of the native token of the NEM
blockchain, which was created by the same team and
preceeded Symbol—can claim an equivalent number
of XYM once the new token has been released.
Y (two z-addresses), from transparent address (t-
Yearn.Finance
Yearn.Finance is a decentralized community focused
on creating a suite of automated, decentralized
finance (DeFi) products on Ethereum. Referring to
themselves as a ‘collective of contributors,’ the Yearn
community is an experiment in decentralization,
crowd-sourced investing, and product development.
Yearn Improvement Proposal (YIP)
Yearn Improvement Proposals (YIPs) are proposals to
change the Yearn protocol. Proposals are submitted
by Yearn.Finance community members and voted on
by YFI token holders.
YFI Token
YFI is the governance token of the Yearn.Finance
protocol.YFI holders can submit, discuss, and vote on
proposals to change the protocol via the Yearn
Improvement Proposal (YIP) process. The total supply
of YFI is 30,000, though more tokens can be minted if
approved through the governance process.
Yield Farming
Yield farming is the practice of staking or locking up
cryptocurrencies in order to generate rewards. Many
decentralized finance (DeFi) projects rely on yield
farming to incentivize users to contribute to the
network's liquidity and stability, since these projects
do not rely on a centralized market facilitator.
yTokens
yTokens are cryptocurrency derivatives tokens which
are awarded to Yearn.Finance liquidity providers (LPs)
when they deposit assets into the protocol. Examples
of yTokens include yCRV, a derivative of Curve (CRV)
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and yaLINK, a derivative of Aave's aLINK, which is itself
a derivative of the LINK token.
yVaults
yVaults are a feature of the Yearn.Finance protocol
which automate the process of yield farming. Users
deposit tokens into a yVault, then Yearn borrows
stablecoins against the user's asset. The stablecoins
are then used for yield farming in various protocols,
with the vault shifting strategies as opportunities
change. As gains are realized on the stablecoins, Yearn
converts the gains back into the user's original asset
and the user's rewards are paid in that asset. Each
yVault has a different annual percentage yield (APY).
Z-Addresses
z-addresses are 'shielded,' or privacy enhanced Zcash
addresses. Transactions between z-addresses do not
reveal the parties' addresses, the transaction amount,
or the contents of the transaction's memo field on the
blockchain. z-addresses utilize zero-knowledge proofs
to achieve these features. z-addresses are
interoperable with transparent z-cash addresses,
which reveal the transacting parties' addresses,
transaction amount, and the contents of the
transaction's memo field. Users can therefore send
transactions from private address to private address
address) to private address (z-address), or from
private address (z-address) to transparent address (t-
address).
Zcash (ZEC)
Zcash is a privacy-focused cryptocurrency project
which aims to provide efficient, private transactions
for its users via its shielded addresses feature. The
Zcash protocol utilizes its native token, ZEC, to
facilitate these transactions.
Zero-Knowledge Proof
Zero-Knowledge Proofs are a cryptographic method
that provides users with a higher degree of privacy
when engaging in digital transactions. In essence,
zero-knowledge proofs enable one party to prove to
another party that they know a specific value, without
conveying any other information apart from the fact
that they know that value. In short, these proofs allow
for information to be accurately verified without
sharing any details about the underlying information
and the identities of the transaction participants.
Zero Knowledge Proof Roll-Up (ZKR)
Roll-ups bundle and process smart contract
transactions off of the main chain on sidechains
before sending them back to the main chain for
finalization. A Zero-Knowledge proof Rollup (ZKR) is a
type of roll-up which bundles transactions,
compresses them, and then attaches a zero-
knowledge proof to attest to the state of the
sidechain before sending the transactions back to the
main chain. While ZKRs are trustless, they require
specialized hardware.
zk-SNARK
Zero-Knowledge Succinct Non-Interactive Argument of
Knowledge (zk-SNARK) is a type of cryptographic proof
used to ensure privacy on blockchain-based
distributed ledger systems. It works by proving that
one party is in possession of specific data without
actually revealing the data to the network by using a
secret key before the transaction is broadcasted. zk-
SNARKS became prominent with Zcash, Monero, and
other privacy-based blockchain protocols.

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