A list of commonly used terms and explanations
- Blockchain - Blockchain is a shared, immutable ledger that facilitates the process of recording transactions and tracking assets in a business network. An asset can be tangible (a house, car, cash, land) or intangible (intellectual property, patents, copyrights, branding). Virtually anything of value can be tracked and traded on a blockchain network, reducing risk and cutting costs for all involved.
- Bridging - Also known as blockchain bridge is a protocol connecting two blockchains to enable interactions between them. If you own one cryptocurrency but want to participate in DeFi activity on another cryptocurrency's network, a blockchain bridge allows you to do that without selling the cryptocurrency you originally own.
- Crypto Burning - Cryptocurrency burning is the process in which users can remove tokens (also called coins) from circulation, which reduces the number of coins in use. The tokens are sent to a wallet address that cannot be used for transactions other than receiving the coins. The wallet is outside the network, and the tokens can no longer be used.
- Crypto Currency - A cryptocurrency is a digital, encrypted, and decentralised medium of exchange. Unlike Fiat currencies there is no central authority that manages and maintains the value of a cryptocurrency. Instead, these tasks are broadly distributed among a cryptocurrency’s users via the internet. You can use crypto to buy regular goods and services.
- Crypto Staking - Staking cryptocurrencies is a process that involves committing your crypto assets to support a blockchain network and confirm transactions. It's available with cryptocurrencies that use the proof of stake model to process payments. Staking can be a great way to use your crypto to generate passive income, especially because some cryptocurrencies offer high-interest rates for staking.
- Crypto Token - A crypto token is a virtual currency token or a denomination of a cryptocurrency. It represents a tradable asset or utility that resides on its own blockchain and allows the holder to use it for investment or economic purposes.
- Cryptowallet - Crypto wallets keep your private keys – the passwords that give you access to your cryptocurrencies – safe and accessible, allowing you to send and receive cryptocurrencies. They come in many forms, from hardware wallets like Ledger (which looks like a USB stick) to mobile apps like Coinbase Wallet which makes using crypto as easy as shopping with a credit card online.
- DAO - A decentralized autonomous organization (DAO), sometimes called a decentralized autonomous corporation (DAC), is an organization constructed by rules encoded as a computer program that is often transparent, controlled by the organization's members, and not influenced by a central government. In general terms, DAOs are member-owned communities without centralized leadership. A DAO's financial transaction records and program rules are maintained on a blockchain. The precise legal status of this type of business organization is unclear.
- DEFI - Decentralized finance (DeFi) is an emerging financial technology based on secure distributed ledgers similar to those used by cryptocurrencies. The system removes the control banks and institutions have on money, financial products, and financial services.
- ERC-1155 - Is a token standard that enables the efficient transfer of fungible and non-fungible tokens in a single transaction. ERC stands for "Ethereum request for comment," and the ERC20 standard was implemented in 2015.
- ERC20 - This token standard is used for creating and issuing smart contracts on the Ethereum blockchain. Smart contracts can then be used to create smart property or tokenized assets that people can invest in. ERC stands for "Ethereum request for comment," and the ERC20 standard was implemented in 2015.
- Fiat - Fiat money is a government-issued currency that is not backed by a physical commodity, such as gold or silver, but rather by the government that issued it. The value of fiat money is derived from the relationship between supply and demand and the stability of the issuing government, rather than the worth of a commodity backing it. Most modern paper currencies are fiat currencies, including the U.S. dollar, the euro, and other major global currencies.
- GameFi - GameFi refers to play-to-earn blockchain games that offer economic incentives to players. Typically, players can earn cryptocurrency and NFT rewards by completing tasks, battling other players, and progressing through the different game levels. Unlike traditional video games, most blockchain games let players transfer the gaming items out of the game’s virtual world. This allows players to trade their items on NFT marketplaces and their crypto earnings on crypto exchanges.
- NFT - An NFT is a digital asset that represents real-world objects like art, music, in-game items, and videos. They are bought and sold online, frequently with cryptocurrency, and they are generally encoded with the same underlying software as many cryptos.