📚 Glossary

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API

API stands for Application Programming Interface. It is a set of routines, protocols, and tools for building software applications. APIs specify how software components should interact, such as what data to use and what actions should be taken. It is thanks to the API's that you will be able to connect your wallets on the exchanges to UpBots

ADDRESS

A place where cryptocurrency can be sent to and from, in the form of a string of letters and numbers.

Algorithm

A process or set of rules to be followed in problem-solving or calculation operations, usually by a computer. For UpBots, these are rules used to define an entry point and an exit point for strategies.

All-Time-High (ATH)

The highest point (in price, in market capitalization) that a cryptocurrency has been in history. *see All-Time-Low (ATL).

All-Time-Low (ATL)

The lowest point (in price, in market capitalization) that a cryptocurrency has been in history. *see All-Time-High (ATH).

Altcoin

As Bitcoin is the first cryptocurrency that captured the world’s imagination, all other coins were subsequently termed “altcoins,” as in “alternative coins.”

Arbitrage

Arbitrage is the practice of quickly buying and selling the same asset in different markets to take advantage of price differences between the markets.

Ask Price

In any financial market, buyers and sellers place their orders to determine the highest price they are willing to buy and the lowest price they are willing to sell. The buyers place “bids" and sellers place "asks," or offers to sell. If a "bid" is higher than an "ask," a trade occurs, as the buyer is willing to pay more than what the seller wants. At any given point in time, the lowest ask order that is unmatched becomes the "Ask Price" of the market.

Automated Market Maker (AMM)

An automated market maker (AMM) is a system that provides liquidity to the exchange it operates in through automated trading.

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Bag

A significant quantity of a specific cryptocurrency is considered a “bag.” How many depends on the definition of the person using the expression. *see Bagholder.

Bagholder

A person who holds large quantities, or bags, of a cryptocurrency. Often used to describe such a person when the price of that cryptocurrency is declining.

Bear

A person who is pessimistic about market prices and expects them to decline. This person is also known to be "bearish" about the market or price. *see Bull.

Bear Trap

A technique played by a group of traders, aimed at manipulating the price of a cryptocurrency. The bear trap is set by selling a large amount of the same cryptocurrency at the same time, fooling the market into thinking there is an upcoming price decline. In response, other traders sell their assets, further driving the price down. Those who set the trap then release it, buying back their assets at a lower price. The price then rebounds, allowing them to make a profit.

Block

A container or collection of transactions occurring every time period on a blockchain.

Blockchain

A blockchain is a continuously growing, append-only, list of records called blocks, which are linked and secured using cryptography.

Bollinger Band

A tool developed by Bollinger to help in the recognition of systemic pattern recognition in prices; it is a band that is plotted two standard deviations away from the simple moving average, or exponential moving average in some cases.

Bots

Automated trading software bots that execute trade orders extremely quickly, based on a preset algorithm of buy-and-sell rules.

An algo is defined by the specifics settings imposed by the strategy and the bot will execute the orders sent by the algo.

Bull

A person that is optimistic and confident that market prices will increase, this person is also known to be "bullish" about the market or price.

Bull Trap

A bull trap occurs when a steadily declining asset appears to reverse and go upward, but soon resumes its downward trend.

Burned (burning of cryptos)

Cryptocurrency tokens or coins are burned when they are permanently removed from the circulating supply on purpose — as opposed to assets that are lost on accident, like by being unintentionally sent to an address with no owner or via the loss of access to the wallet where they are stored.

Token burning is usually performed by the development team behind a particular cryptocurrency asset. It can be done in several ways, most commonly by sending the coins to a so-called “eater address”: its current balance is publicly visible on the blockchain, but access to its contents is unavailable to anyone.

The practice of burning may involve the project’s developers buying tokens back from the market or burning parts of the supply already available to them.

Burning can be done with different goals in mind, but most often it is used for deflationary purposes: the decrease in the circulating supply tends to drive an asset’s price upward, incentivizing traders and investors to get involved.

Buy Wall

A buy wall is a disproportionately large buy limit order placed on a cryptocurrency exchange.

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Candlesticks

A candlestick chart is a graphing technique used to show changes in price over time. Each candle provides 4 points of information opening price, closing price, high, and low. Also known as “candles” for short.

Centralized

A centralized organizational structure is one in which a single node or a small number of them are in control of an entire network.

Centralized Exchange (CEX)

Centralized exchanges (CEXs) are a type of cryptocurrency exchange that is operated by a company that owns it in a centralized manner.

Circulating Supply

The best approximation of the number of coins that are circulating in the market and in the general public’s hands.

Close

Refers to the closing price; similar to the same term used in stock trading.

Coin

A coin can refer to a cryptocurrency that can operate independently or to a single unit of such cryptocurrency.

Cold Storage

Offline storage of cryptocurrencies, typically involving hardware non-custodial wallets, USBs, offline computers, or paper wallets.

Cold Wallet

A cryptocurrency wallet that is in cold storage, i.e. not connected to the internet.

Consensus

Consensus is achieved when all participants of the network agree on the order and content of the blocks in the blockchain.

Cryptocurrency

Cryptocurrencies are digital currencies that use cryptographic technologies to secure their operatio

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DYOR

Age old adage “Do Your Own Research.” Don’t just take people at their word.

Day Trading

Day trading is the practice of frequently buying and selling assets in order to make a profit on intraday changes in their price.

DeFi

DeFi (decentralized finance) is the creation of an ecosystem of financial tools built on blockchain. Also known as open finance, DeFi apps take traditional financial services and rebuild them as open and permissionless.

Decentralized

Decentralized organizations are those that do not rely on a single center of authority to enforce the rules and maintain operation. Instead, they are composed of numerous decision-makers with the same or comparable degrees of authority over the rest of the system and rely on varied consensus mechanisms to reach a common plan of action.

A decentralized organization is one of the two major types of organizational structure, the other one being centralized organizations.

An example of such a system would be a business that relies on franchising to expand, in which willing individuals are allowed to purchase a franchise, open their own branch of the company and make independent managerial decisions in regards to hiring, workflow organization and so on.

Another prominent example of decentralized systems are cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH), which are supported by networks of independent computer-nodes that achieve consensus via algorithms such as proof-of-work (PoW) to infallibly and uniformly process and record all transactions.

By the virtue of not relying on a central point of authority, decentralized organizations become more robust than their centralized counterparts; unlike in the latter, where a malfunction of the governing entity disables the entire organization, decentralized systems continue working even when one or several parts of them cease operation. They are also more democratic and less prone to censorship.

Decentralized organizations have disadvantages too, which mainly stem from a lack of unified vision and a clear separation of responsibilities. This tends to result in reduced efficiency compared to a single-minded centralized organization.

Decentralized Applications (DApps)

A type of application that runs on a decentralized network, avoiding a single point of failure. DApps are any computer applications whose operation is maintained by a distributed network of computer-nodes, as opposed to a single server.

Decentralized Autonomous Organizations (DAO)

An organization that is run through rules encoded in smart contracts and managed by the community.

Decentralized Exchange (DEX)

A peer-to-peer exchange that allows users to buy and sell cryptocurrency and other assets without a central intermediary involved.

Deflation

Reduction of the general level of prices in an economy. May also refer to deflationary monetary policy, such as Bitcoin, where there is a fixed supply of coins.

Depth Chart

A graph that plots the requests to buy (bids) and the requests to sell (asks) on a chart, based on limit orders. The chart shows the point at which the market is most likely to accept a transaction.

Derivative

A contract deriving its value from the performance of an underlying asset, index or interest rate.

Derivatives Market

A public market for derivatives, instruments such as futures contracts or options, which are derived from other forms of cryptocurrency assets.

Digital Currency

Digital currency, also known as digital money or electronic money or electronic currency, is a type of currency available only in digital form, allowing for instantaneous transactions and borderless transfer-of-ownership.

Dump

To sell off all the coins leading to a decrease of the value of this coin on the market.

Dumping

The action of collective market sell-offs, creating downward price movement.

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ERC-20

A token standard for Ethereum, used for smart contracts implementing tokens. It is a common list of rules defining interactions between tokens, including transfer between addresses and data access.

ERC-721

A token standard for non-fungible Ethereum tokens. An Ethereum Improvement Proposal introduced in 2017, it enables smart contracts to operate as tradeable tokens similar to ERC-20 tokens.

Emission

Emission, also known as Emission Curve, Emission Rate and Emission Schedule, is the speed at which new coins are created and released.

Escrow

An escrow is a contractual arrangement in which a third party receives and disburses money or documents for the primary transacting parties, with the disbursement dependent on conditions agreed to by the transacting parties. This is possible to be automated using smart contracts on the blockchain.

Ether

The form of payment used in the operation of the distribution application platform, Ethereum, in order to incentivize machines into executing the requested operations.

Exchange

Cryptocurrency exchanges (sometimes called digital currency exchanges) are businesses that allow customers to trade cryptocurrencies for fiat money or other cryptocurrencies.

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FOMO

An acronym that stands for “Fear of Missing Out” and in the context of investing, refers to the feeling of apprehension for missing out on a potentially profitable investment opportunity and regretting it later.

FUD

An acronym that stands for “Fear, Uncertainty and Doubt.” It is a strategy to influence perception of certain cryptocurrencies or the cryptocurrency market in general by spreading negative, misleading or false information. *see FUDster.

Fiat

Fiat currency is “legal tender” backed by a central government, such as the Federal Reserve, and with its own banking system, such as fractional reserve banking. It can take the form of physical cash, or it can be represented electronically, such as with bank credit.

Fork (Blockchain)

Forks, or chain splits, create an alternate version of the blockchain, leaving two blockchains to run simultaneously. An example is Ethereum and Ethereum Classic, which was forked after the DAO hack.

Fundamental Analysis (FA)

A method in which you research the underlying value of an asset by looking at the technology, team, growth prospects and other indicators. Some people perform fundamental analysis as part of an investment strategy called “value investing.”

Futures

A futures contract is a standardized legal agreement to buy or sell a particular commodity or asset at a predetermined price at a specified time in the future. They are different from forward contracts, which can be customized for each trade and can be conducted over-the-counter, instead of being traded on an exchange.

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Gains

Gains refer to an increase in value or profit.

Gas

A term used on the Ethereum platform that refers to a unit of measuring the computational effort of conducting transactions or smart contracts, or launch DApps in the Ethereum network. It is the “fuel” of the Ethereum network. *see Gas Limit and Gas Price.

Gas Limit

A term used on the Ethereum platform that refers to the maximum amount of gas the user is willing to spend on a transaction.

Gas Price

A term used on the Ethereum platform that refers to the price you are willing to pay for a transaction. Setting a higher gas price will incentivize miners to prioritize that transaction over others.

Governance Token

Governance tokens are tokens that developers create to allow token holders to help shape the future of a protocol. Governance token holders can influence decisions concerning the project such as proposing or deciding on new feature proposals and even changing the governance system itself.

In many cases, the changes proposed, vetted and then voted on through on-chain governance accessed by using governance tokens are applied automatically due to smart contracts. In other cases, the team maintaining the project is tasked with applying the changes or hiring someone who will.

Proponents of systems that use governance tokens believe that they allow for user control, which holds true to the original cryptocurrency ideals of decentralization and democratization. In most cases, organizations who let users control the development of their systems are called decentralized autonomous organizations (DAOs).

One well-known example of a governance token is Maker (MKR). This token allows its holders to vote on decisions pertaining to the decentralized finance (DeFi) protocol that the decentralized stablecoin DAI runs on.

For example, MKR holders can vote to change the complex economic rules that govern the decentralized lending that allows DAI to keep its price stable. At the time that the text you are reading was being written, MKR holders were voting on whether the protocol’s debt ceiling should be raised.

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HODL

A type of passive investment strategy where you hold an investment for a long period of time, regardless of any changes in the price or markets. The term first became famous due to a typo made in a Bitcoin forum, and the term is now commonly expanded to stand for “Hold On for Dear Life.”

Hard Cap

The maximum amount that an ICO will raise. If a hard cap is reached, no more funds will be collected. *see Soft Cap.

Hierarchical Deterministic Wallet (HD Wallet)

A wallet that uses Hierarchical Deterministic (HD) protocol to support the generation of crypto-wallets from a single master seed using 12 mnemonic phrases. *see Deterministic Wallet.

Hosted Wallet

A wallet managed by a third-party service.

Hot Wallet

A cryptocurrency wallet that is connected to the internet for hot storage of cryptoassets, as opposed to an offline, cold wallet with cold storage. *See Cold Wallet.

Hot Storage

The online storage of private keys allowing for quicker access to cryptocurrencies. *see Cold Storage.

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Impermanent Loss

Impermanent loss is when a liquidity provider has a temporary loss of funds because of volatility in a trading pair.

Infinite Approval

Infinite approval is a smart contract programming practice, often considered to be problematic. This programming feature sees a given smart contract require authorization to access an unlimited number of tokens from the user’s wallet instead of only the number that is actually needed.

An infamous example of a smart contract that was programmed this way is one employed by decentralized exchange Bancor. When a user first used the system, he had to give the smart contract an authorization to withdraw an unlimited number of tokens from his wallet.

Bancor’s smart contracts also contained a vulnerability that could have allowed a hacker to steal all the units of the token that the user authorized the contract to manage by leveraging this vulnerability. Fortunately, Bancor’s programmers noticed before malicious actors could steal the tokens and later modified their systems to only ask for approval for the needed number of tokens. The developers preemptively “stole” user funds to return them later to avoid a hack.

After the controversy surrounding Bancor, it surfaced that infinite approval is a very popular practice among decentralized application programmers. Research conducted by a researcher at crypto wallet ZenGo revealed that popular decentralized applications Compound, Uniswap, bZX, Aave, Kyber and dYdX all feature infinite or extremely large approvals.

For instance, a liquidity provider may provide a liquidity pool with $5,000 worth of Ether and $5,000 of USD-pegged decentralized stablecoin DAI to allow trading back and forth between the two. This way, every time a trade on the ETH/DAI is executed, the liquidity provider would receive compensation for having funded the pool in question.

Inflation

A general increase in prices and fall in the purchasing value of money.

Initial Coin Offering (ICO)

A type of crowdfunding, or crowdsale, using cryptocurrencies as a means of raising capital for early-stage companies.

Initial Exchange Offering (IEO)

An initial exchange offering (IEO) refers to a fundraising event where a cryptocurrency exchange raises money on its own platform, as opposed to an ICO, where a team conducts the fundraising. *See Initial Coin Offering.

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KYC

Acronym for “Know Your Customer,” this process refers to a project’s or financial institution’s obligations to verify the identity of a customer in line with global anti-money laundering laws.

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Leverage

A loan offered by a broker on an exchange during margin trading to increase the availability of funds in trades. It will let trade more than the capital you have and multiply your profit or your loss.

Limit Order / Limit Buy / Limit Sell

Orders placed by traders to buy or sell a cryptocurrency when a certain price is reached. This is in contrast with market orders at which a cryptocurrency is sold at the current best available price.

Liquidity

How easily a cryptocurrency can be bought and sold without impacting the overall market price.

Liquidity Pool

Liquidity pools are pools of tokens locked in smart contracts that provide liquidity in decentralized exchanges in an attempt to attenuate the problems caused by the illiquidity typical of such systems. Liquidity pools are also the name given to the intersection of orders which create price levels that — once reached — see the asset decide whether to continue to move in uptrend or downtrend.

The decentralized exchanges that leverage liquidity pools are the same that make use of automated market maker-based systems. On such trading platforms, the traditional order book is replaced by pre-funded on-chain liquidity pools for both the assets of the trading pair.

The advantage of using liquidity pools is that it does not require a buyer and a seller to decide to exchange two assets for a given price, and instead leverages a pre-funded liquidity pool. This allows for trades to happen with limited slippage even for the most illiquid trading pairs, as long as there is a big enough liquidity pool.

The funds held in the liquidity pools are provided by other users who also earn passive income on their deposit through trading fees based on the percentage of the liquidity pool that they provide.

One of the first decentralized exchanges to introduce such a system was Ethereum-based trading system Bancor, but was widely adopted in the space after Uniswap popularized them.

Liquidity Provider

A liquidity provider is a user who funds a liquidity pool with crypto assets she owns to facilitate trading on the platform and earn passive income on her deposit.

Liquidity pools are leveraged by the decentralized exchanges that use automated market maker-based systems to allow trading of illiquid trading pairs with limited slippage. Instead of using traditional order book-based trading systems, such exchanges use funds that are held for every asset in every trading pair to allow trades to be executed.

While trading illiquid trading pairs on order book-based exchanges could lead to suffering from great slippage and the inability to execute trades, the advantage of liquidity providers is that trades can always be executed as long as the liquidity pools are big enough. For this reason, liquidity providers are seen as trade facilitators and paid with the transaction fees paid for the trades that they enabled.

How much liquidity providers are paid is based on the percentage of the liquidity pool that they provide. When funding the pool, they are usually required to fund two different assets to enable traders to switch between one to the other by trading them in pairs.

For instance, a liquidity provider may provide a liquidity pool with $5,000 worth of Ether and $5,000 of USD-pegged decentralized stablecoin DAI to allow trading back and forth between the two. This way, every time a trade on the ETH/DAI is executed, the liquidity provider in question would receive compensation for having funded the pool in question.

Long

A situation where you buy a cryptocurrency with the expectation of selling it at a higher price for profit later.

M-O

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Mainnet

An independent blockchain running its own network with its own technology and protocol. It is a live blockchain where its own cryptocurrencies or tokens are in use, as compared to a testnet or projects running on top of other popular networks such as Ethereum.

Margin Call

When an investor’s account value falls below the margin maintenance amount. The broker will then demand that the investor deposit additional money or securities to meet the minimum required maintenance amount to continue trading.

Margin Trading

A practice where a trader uses borrowed funds from a broker to trade a cryptocurrency, which forms the collateral for the loan from the broker. It can be relatively risky for inexperienced traders who may receive a margin call if the market moves in the opposite direction of their trades. Margin Bear Position The position you are taking if you are going “short” on margin. Margin Bull Position The position you are taking if you are going “long” on margin.

Market

An area or arena, online or offline, in which commercial dealings are conducted. Usually referred to as the “crypto market,” which refers to the cumulative cryptocurrencies and projects operating within the industry.

Market Capitalization / Market Cap / MCAP

Total capitalization of a cryptocurrency’s price. It is one of the ways to rank the relative size of a cryptocurrency. *see Circulating Supply.

Market Order / Market Buy / Market Sell

A purchase or sale of a cryptocurrency on an exchange at the current best available price. Market orders are filled as buyers and sellers are willing to trade. This is in contrast with limit orders at which a cryptocurrency is sold only at a specified price.

Max Supply

The best approximation of the maximum amount of coins that will ever exist in the lifetime of the cryptocurrency. *see Circulating Supply and Total Supply.

Microtransaction

A business model where very small payments can be made in exchange for common digital goods and services, such as pages of an ebook or items in a game.

Mining

A process where blocks are added to a blockchain, verifying transactions. It is also the process through which new bitcoin or some altcoins are created.

Moving Average Convergence Divergence (MACD)

A technical analysis method, it is a trend-following momentum indicator that shows the relationship between two price moving averages. The calculation is done by subtracting the 26-day exponential moving average (EMA) from the 12-day EMA.

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Non-custodial

Usually referring to the storage of keys, in relation to wallets or exchanges, a non-custodial setup is one in which private keys are held by the user directly. *see Custodial.

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Offline Storage

The act of storing cryptocurrencies in devices or systems not connected to the internet. *see Online Storage.

Online Storage

The act of storing cryptocurrencies in devices or systems connected to the internet. Online storage offers more convenience but also increased risk of theft. *see Offline Storage.

Open/Close

The price at which a cryptocurrency opens at a time period, for example at the start of the day; the price at which a cryptocurrency closes at a time period, for example at the end of the day. In general, these terms were more useful in traditional financial markets as there are fixed hours of the day in which trading occurs.

Option

A contract giving the buyer the right, but not the obligation, to buy or sell an underlying asset or instrument at a specified strike price. There are American and European options, the former of which may be exercised at any time before expiration, and the latter exercised only at the expiration date.

Options Market

A public market for options, giving the buyer an option to buy or sell a cryptocurrency at a specific strike price, on or before a specific date.

Oracles

An agent that finds and verifies information, bridging the real world and the blockchain by providing data to smart contracts for execution of said contracts under specified conditions.

Over The Counter (OTC)

Over-the-counter is defined as a transaction made outside of an exchange, often peer-to-peer through private trades. In jurisdictions where exchanges are disallowed or where amounts traded will move the markets, traders will go through the OTC route.

Overbought

When a cryptocurrency has been purchased by more and more investors over time, with its price increasing for an extended period of time. When this happens without any justifiable reason, the cryptocurrency is considered overbought, and a period of selling is expected.

Oversold

When a cryptocurrency has been sold by more and more investors over time, with its price decreasing for an extended period of time. When this happens without any justifiable reason, the cryptocurrency is considered oversold, and a period of buying is expected.

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Pair

Trade between one cryptocurrency and another, for example, the trading pair BTC/ETH.

Peer to Peer (P2P)

The decentralized interactions between parties in a distributed network, partitioning tasks or workloads between peers.

Platform

It refer to a cryptocurrency exchange on which you may trade cryptocurrencies, like UpBots.

Portfolio

A collection of cryptocurrencies or crypto assets held by an investment company, hedge fund, financial institution or individual.

Pre-sale

A sale that takes place before an ICO is made available to the general public for funding.

Price Impact

Price impact is an expression used to describe the correlation between an incoming order and the change in the price of the asset involved caused by the trade.

Buy trades push the price of a given asset higher by exhausting the cheapest sell orders in the order book, while the opposite happens for selling trades. The extent to which the price moves as a result of trades largely depends on the liquidity of the trading pair affected. More liquid trading pairs will see a smaller price impact than those with lower trading volumes.

Traders — especially those trading on markets with limited liquidity or those who make big trades — have to keep in mind the impact of their trade on the asset price. Their second buy trade will on average be more expensive than the first one because of their impact on the market.

Monitoring and controlling price impact is one of the hottest areas of interest in research conducted by trading firms. Much effort is currently being dedicated to understanding how dependent the trade impact is on the trade size and how long it takes for its effect on asset price to manifest fully.

Private Key / Secret Key

A piece of code generated in asymmetric-key encryption process, paired with a public key, to be used in decrypting information hashed with the public key. This is requested in order to add your exchanges to UpBots.

Proof-of-Stake (PoS)

A blockchain consensus mechanism involving choosing the creator of the next block via various combinations of random selection and wealth or age of staked coins or tokens. *see Proof-of-Work (PoW).

Proof-of-Work (PoW)

A blockchain consensus mechanism involving solving of computationally intensive puzzles to validate transactions and create new blocks. *see Proof-of-Stake (PoS).

Public Address

A public address is the cryptographic hash of a public key, allowing the user to use it as an address to request for payment.

Public Blockchain

A blockchain that can be accessed by anyone.

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ROI

Short for “Return on Investment,” the ratio between the net profit and cost of investing.

Relative Strength Index (RSI)

A form of technical analysis that serves as a momentum oscillator, measuring the speed and change of price movements, developed by J. Welles Wilder. It oscillates between zero and 100, where a cryptocurrency is considered overbought when the indicator is above 70 and oversold when below 30.

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Second-Layer Solutions

A set of solutions built on top of a public blockchain to extend its scalability and efficiency, especially for micro-transactions or actions. Examples include Plasma, TrueBit, Lightning Network and more.

Securities and Exchange Commission (SEC)

An independent agency of the United States federal government, responsible for enforcing federal securities laws, proposing securities rules, and regulating the securities industry, the nation's stock and options exchanges, and other related activities and organizations.

Short

A trading technique in which a trader borrows an asset in order to sell it, with the expectation that the price will continue to decline. In the event that the price does decline, the short seller will then buy the asset at this lower price in order to return it to the lender of the asset, making the difference in profit.

Side Chain

A blockchain ledger that runs in parallel to a primary blockchain, where there is a two-way link between the primary chain and sidechain. This allows the sidechain to operate independently of the primary blockchain, using their own protocols or ledger mechanisms.

Smart Contract

A smart contract is a computer protocol intended to facilitate, verify, or enforce a contract on the blockchain without third parties.

Smart Contract Audit

A smart contract audit is a service offered by cybersecurity firms specializing in blockchain technology and decentralized applications. During such checks, experts look for vulnerabilities and bugs in the code that comprises a smart contract to ensure that there are no vulnerabilities.

Such checks are complex, as smart contracts often interact with each other and any integrations with third-party systems can also result in making the system vulnerable. Because of this, the checks are often expanded to other smart contracts involved in any interactions, and even those that the ones it interacts with are interacting with. Such checks usually include both running tests and manual code analysis.

Smart contracts often manage huge quantities of funds and a single bug or vulnerability can result in great losses. More precisely, the users and stakeholders of the decentralized application in question could lose all the assets that are part of the ecosystem.

Soft Cap

The minimum amount that an initial coin offering (ICO) wants to raise. Sometimes, if the ICO is unable to raise the soft cap amount, it may be called off entirely. *see Hard Cap.

Spot

A contract or transaction buying or selling a cryptocurrency for immediate settlement, or payment and delivery, of the cryptocurrency on the market.

Spot Market

A public market in which cryptocurrencies are traded for immediate settlement. It contrasts with a futures market, in which settlement is due at a later date.

Stablecoin

A cryptocurrency with extremely low volatility, sometimes used as a means of portfolio diversification. Examples include gold-backed cryptocurrency or fiat-pegged cryptocurrency.

Staking

Participation in a proof-of-stake (PoS) system to put your tokens in to serve as a validator to the blockchain and receive rewards.

Storage (Decentralized)

Decentralized storage refers to the concept of storing files online by splitting them into encrypted fragments and delegating these fragments to multiple nodes on a distributed network, e.g. a blockchain.

Symbol

The ticker of a cryptocurrency; for example, bitcoin’s symbol is BTC.

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Technical Analysis / Trend Analysis (TA)

An evaluation method involving statistical analyses of market activity, such as price and volume. Charts and other tools are used to identify patterns to underpin and drive investment decisions.

Testnet

An alternative blockchain used by developers for testing.

Ticker

An abbreviation used to uniquely identify cryptocurrencies. *see Symbol.

Token

A digital unit designed with utility in mind, providing access and use of a larger crypto economic system. It does not have a store of value on its own, but is made so that software can be developed around it.

Token Swap

1. There are many exchange services on the market that allow users to buy and sell cryptocurrencies for traditional currencies or for other cryptos. However, due to the limited liquidity and number of trading pairs on each exchange, users that want to trade directly between two crypto tokens are sometimes unable to do so.

This is especially true for the less popular tokens, because they are often only available on a small number of exchanges. Instead of a direct trade, users are forced to include the intermediate step of converting into and out of fiat money or one of the most popular cryptocurrencies, such as BTC or ETH.

However, some exchange services target this issue specifically by aggregating multiple other exchanges and sourcing liquidity from them. The end result is that users are able to swap between two cryptocurrencies directly without the inconvenience and double fees associated with conducting a trade in two steps. Some of the services that allow token swaps are Metamask, ShapeShift and AirSwap.

2. In addition to serving their direct purpose — as decentralized digital money — some cryptocurrencies like ETH, NEO and QTUM allow users to launch other crypto tokens on top of their blockchains.

These second-layer tokens can “piggyback” off the underlying platforms and enjoy some of their security and popularity without having to spend time and resources on growing their own ecosystem from the ground up.

However, in some cases, the platform a token is built upon may become inadequate for its current needs. For example, developers might build their token on Ethereum’s blockchain to leverage its large user base during the initial coin offering, but then decide that they need different underlying parameters for the actual product launch.

In such cases, a token swap is possible, wherein the developers migrate their token from one blockchain base to another, while maintaining all address balances.

Tokenize

The process by which real-world assets are turned into something of digital value called a token, often subsequently able to offer ownership of parts of this asset to different owners.

Total Supply

The total amount of coins in existence right now, minus any coins that have been verifiably burned. *see Circulating Supply and Max Supply.

Trade Volume

The amount of the cryptocurrency that has been traded in the last 24 hours.

Transaction (TX)

The act of exchanging cryptocurrencies on a blockchain.

Transaction Fee

A payment for using the blockchain to transact.

Trustless

A property of the blockchain, where no participant needs to trust any other participant for transactions to be enforced as intended.

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V-Z

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Volatility

A statistical measure of dispersion of returns, measured by using the standard deviation or variance between returns from that same security or market index.

Volume

The amount of cryptocurrency that has been traded during a certain period of time, such as the last 24 hours or more. Volume can show the direction and movement of the cryptocurrency as well as a prediction of future price and its demand.

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Wallet

A cryptocurrency wallet is a secure digital wallet used to store, send, and receive digital currency, and are divided into two categories hosted wallets and cold wallets.

Wash Trade

A form of market manipulation in which investors create artificial activity in the marketplace by simultaneously selling and buying the same cryptocurrencies.

Whitepaper

A document prepared by an ICO project team to interest investors with its vision, cryptocurrency use and cryptoeconomic design, technical information, and a roadmap for how it plans to grow and succeed.

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YTD

Stands for Year to Date.

Yield Farming

Yield farming is a way to make more crypto with your crypto. It involves you lending your funds to others through the magic of computer programs called smart contracts. In return for your service, you earn fees in the form of crypto. Simple enough, huh? Well, not so fast.

Yield farmers will use very complicated strategies. They move their cryptos around all the time between different lending marketplaces to maximize their returns. They’ll also be very secretive about the best yield farming strategies. Why? The more people know about a strategy, the less effective it may become. Yield farming is the wild west of Decentralized Finance (DeFi), where farmers compete to get a chance to farm the best crops.