ABI is an acronym for Application Binary Interface, and it is an interface between two binary program modules at the level of machine code, not source code.
Is an event where free NFTs are distributed to an audience. It can be a QR code displayed on a screen so it can be captured on a smartphone, or it can be printed on cards for later access. There are token and cryptocurrency airdrops as well, which are unsolicited distributions of new projects to wallets which fulfil certain, usually retroactive, criteria.
AMM is acronym for Automated Market Maker.
API is an acronym for Application Programming Interface which is an interface between computers or programs that allows information to pass between them.
Arbitrum is an Ethereum layer 2 scaling solution that reduces fees and network congestion by computing transactions outside of the Ethereum Mainnet. Arbitrum's rollups use multi-round fraud proofs to verify contracts were executed correctly.
An archival node is a full node in the blockchain that keeps a complete history of transactions and address state changes since the genesis block.
Is an image used to visually represent an individual. When secured with an NFT, an avatar is a unique asset that can be sold or traded. Avatars are used in gaming, social media and virtual reality platforms.
The base fee is an algorithmically determined fee that users on the Ethereum blockchain must pay to complete a transaction. The base fee is designed to help smooth transaction fees and prevent sudden spikes by targeting 50% full blocks. Depending on how full the new block is, the Base Fee is automatically increased (the block is more than 50% full) or decreased (the block is less than 50% full).
The Block Gas Estimator Feed estimates gas prices for the next block based upon the in-flight transactions that are currently in the mempool (pre-chain transactions).
A blockchain is a distributed database that is shared among the nodes of a computer network. Blockchains store a continuously growing historical ledger of information (e.g. accounts and transactions) into blocks which are all cryptographically linked.
A bridge is an application that connects two (or more) blockchains. Bridges allows users to send digital assets from one network to another. This is also commonly referred to as "cross-chain" swapping.
Bulletproofs are short, non-interactive zero-knowledge proofs that require no trusted setup. Bulletproofs can be used to convince a verifier that an encrypted plaintext is well-formed.
Is a device that provides the same functions as online wallets but stores private key information offline. While more difficult to use, they are more secure than online wallets.
When numerous nodes—usually most nodes on the network—all have the same blocks in their locally validated blockchain, they have achieved consensus.
Are social tokens issued by an individual creator or brand influencer. Also, creator coins can be used to obtain early access and/or discounts to the creator’s future work. For example, a book author may reward someone with a creator coin for subscribing to a newsletter, writing a review or taking a survey.
Is short for cryptocurrency. By extension, it is any asset or process that uses cryptography.
Is a blockchain application that creates a digital currency. Secured by cryptography on a blockchain, they are hard to counterfeit or double-spend. Individual units of cryptocurrency are called crypto coins. A crypto coin has a known value and can be exchanged for government issued currencies (referred to as fiat money).
Is the science of securing data and communications so that only a person possessing a key can decode and view the content. Earlier forms of cryptography required the physical exchange of codebooks and keys before messages could be sent securely. On the Internet, these old methods have been replaced by Public Key Cryptography, a system using two keys to encode and decode content—one public and one private.
Decentralized Autonomous Organization. A company or other organization that operates without hierarchical management. It is a form of legal structure that has no central governing body and whose members share a common goal to act in the best interest of the entity. DAOs are enabled by Smart Contract technology.
DeFi is an abbreviation of Decentralized Finance, or an open financial system that does not rely on centralized authorities or intermediaries like banks to conduct financial activities permissionlessly like trading, borrowing, lending, and investing.
DEX is an abbreviation for Decentralized Exchange. This type of crypto exchange enables users to transact in a direct peer-to-peer manner without any intermediary.
A double spend is a deliberate fork, where a user with a large amount of mining power sends a transaction to purchase some product, then after receiving the product creates another transaction sending the same coins to themselves. The attacker then creates a block, at the same level as the block containing the original transaction but containing the second transaction instead, and starts mining on the fork. If the attacker has more than 50% of all mining power, the double-spend is guaranteed to succeed eventually at any block depth. Below 50%, there is some probability of success, but it is usually only substantial at a depth up to about 2-5. For this reason, most cryptocurrency exchanges, gambling sites, and financial services wait until six blocks have been produced (“six confirmations”) before accepting a payment.
Also known as Ethereum Improvement Proposal 1559, EIP-1559 was part of Ethereum's London hard fork and it was deployed across the Ethereum network on August 5th, 2021. EIP-1559 introduced a Base Fee which is paid by users and is eventually burned (i.e. removed from circulation), and it replaced the current gas limit with two values: a “long-term average target” (equal to the current gas limit), and a “hard per-block cap” (twice the current gas limit).
An EOA transaction is a transaction between one or more externally owned accounts (EOA, or an individual user in the Ethereum network). EOA transactions do not include transactions between smart contracts (internal transactions).
Is the Smart Contract standard set of rules governing how tokens behave on the Ethereum blockchain. ERC stands for Ethereum Request for Comments.
Is an extension of the Ethereum rules governing NFTs and smart contracts.
Is another popular NFT Smart Contract standard.
Ethereum is a decentralized, open-source blockchain network that was launched in 2015. Ethereum is the leading smart contract-enabled blockchain in the world, and it is native token, ETH, is the 2nd largest digital asset by marketcap.
Ethereum 2.0 is a deprecated term that was used to describe the consensus layer of Ethereum as part of its migration from a Proof-of-Work consensus mechanism to Proof-of-Stake consensus. Additionally, Eth1 is now referred to as the "execution layer."
The Ethereum Virtual Machine (EVM) is a software application that blockchain developers use to deploy decentralized applications (Dapp) on the Ethereum blockchain. The EVM interacts with Ethereum's accounts, smart contracts, and distributed ledger.
Refers to any government issued currency. For example, the US dollar is a fiat currency.
Is the lowest price an NFT can be bought or traded for on an exchange.
A fork occurs when two blocks are generated pointing to the same block as their parent, and some portion of miners see one block first and some see the other. This may lead to two blockchains growing at the same time. Generally, it is mathematically near-certain that a fork will resolve itself within four blocks as miners on one chain will eventually get lucky and that chain will grow longer and all miners switch to it; however, forks may last longer if miners disagree on whether a particular block is valid.
A blockchain node that stores the blockchain data, passes along the data to other nodes, and ensures that newly added blocks are valid and authentic.
Is calculated by multiplying the current market price of a token by its max supply.
An on-chain asset that has a quantity greater than 1 and those assets have no discernable or unique traits that differentiate one from another.
Gas is a unit of measurement that represents the computational effort required to complete a transaction. How much a user spends to complete a transaction is determined by the total amount of gas multiplied by the gas price.
Gas fees are the fees users must pay in Ethereum's native currency, Ether (ETH), to complete a transaction. Gas fees are used to compensate validators for providing the computational work required to process and validate transactions.
The gas limit is the maximum amount of gas miners are authorized to consume to complete a transaction.
The gas price is the amount of Ether (ETH) a user is willing to pay for every unit of gas required to complete a transaction (denominated in Gwei).
Acronym for "Good Morning", commonly used on crypto twitter.
Görli is a cross-client, community-based, proof-of-authority (PoA) Ethereum testnet where Web3 developers can test smart contracts in a sandbox.
Is a collection of artificial intelligence models trained on a large amount of online content. As a result, GPT-3 predicts the most likely completion of the statement based on an opening statement or a prompt and a set of keywords.
Gwei is one of the smallest denominations of ETH that is equivalent to 1/1,000,000,000 of 1 ETH (1 ETH = 1,000,000,000 Gwei). It is the most commonly used alternative denomination for ETH and is often used when discussing gas prices.
In-person meeting of developers and other community members to work collaboratively to solve one or more common objectives.
Amount of computing power being used by a Proof of Work network.
Hashing is the transformation of a string of characters into a usually shorter fixed-length value or key that represents the original string. Hashing is used to index and retrieve items in a database because it is faster to find the item using the shorter hashed key than to find it using the original value. It is also used in many encryption algorithms.
A wallet that is networked or connected to the internet in some way (mobile, web).
Refers to any data which cannot be changed or deleted. This is the defining feature of a blockchain where records are a historical record of transactions.
or Initial Currency Offering is a type of funding using cryptocurrencies. It is often a form of crowdfunding, although a private ICO which does not seek public investment is also possible.
An internal transaction is a transaction between one smart contract and another smart contract. Internal transactions do not include EOA transactions which are transactions initiated or between one or more externally owned addresses (i.e. a user's wallet).
Is the ability for one blockchain to access and share information with other blockchains through application programming interfaces (APIs.)
Is a decentralized, distributed, peer-to-peer file-sharing network.
Layer 1 refers to the main blockchain in a multi-level blockchain network. For example, Ethereum and Bitcoin are layer one blockchains. Many layer two blockchains offload resource-intense transactions to their separate blockchain, while continuing to use Ethereum's or Bitcoin's layer one blockchain for security purposes.
Layer 2 (L2) refers to a secondary framework or protocol that is built on top of an existing, layer one blockchain. Layer 2 blockchains typically improve transaction speeds and cost efficiency.
Do not have the entirety of the current blockchain state and depend on a full node, useful for low memory and low computational power devices.
Liquidity is how quickly and easily an asset can be converted into cash or another asset. Decentralized exchanges like Uniswap have multiple liquidity pools where asset holders can deposit their assets where traders can buy and sell them in a decentralized way in exchange for rewards.
A smart contract that facilitates a decentralized funded pooling of multiple assets to ensure those assets can easily be traded for each other.
A person or entity that deposits one or more assets to a liquidity pool of a decentralized exchange, often in exchange for some type of earned benefit (e.g. fee collection, token drop).
Loopring is an Ethereum layer 2 non-custodial exchange protocol. It utilizes ZK-rollups for higher transaction throughput and lower gas fees on trades and payments.
Market cap is calculated by multiplying the current price of a token by its circulating supply.
A Merkle root is the single top hash of a Merkle tree. It verifies all transactions within a block.
A Merkle tree, or hash tree, is a data structure used by blockchains to securely validate and summarize large data sets.
A network of 3D virtual worlds.
Mining is the process of repeatedly aggregating transactions, constructing a block, and trying different nonces until a nonce is found that satisfies the proof of work condition. If a miner gets lucky and produces a valid block, they are granted a certain number of coins as a reward as well as all the transaction fees in the block. Once the valid block is found, all miners start trying to create a new block containing the hash of the newly generated block as their parent.
To manifest new tokens onto a blockchain.
Refers to a strong belief that certain cryptocurrency is soon going to rise significantly in price.
This is done by randomizing the individual secrets. There are always more than 3 endpoints across servers or mobile devices and those secrets are never shared. The endpoints participate in a decentralized wallet creation protocol and the public key that corresponds to the set of the individual private shares (3) gets computed. Whenever a signature is requested for a tx, the quorum (of endpoints, will be 3 or more) are a part of a distributed signature process where each endpoint validates the transaction and policy and then signs the transaction.
Like MPC, Multi-Sig eliminates a single point of failure but the issues with Multi-Sig lie in interoperability and being protocol agnostic. Not all cryptocurrencies or DAOs support Multi-Sig as each protocol requires a wallet provider to implement different code. New wallets would need to be created to modify quorums and refresh any keys.
A server or computer running blockchain-specific software used for connecting to and interacting with that blockchain.
A wallet that is fully controlled by the user (whether an end user or institutional user) making the user responsible for the security of the wallet, private keys, and assets stored in the wallet.
A non-fungible token (NFT) is a digital asset based on Ethereum's ERC-721 token standard that can be used to represent ownership of a variety of digital assets including art, photography, music, and more.
Nonce is a number associated with Ethereum transactions from EOAs (externally owned accounts) that increases by one with every transaction, and a value that can only be used once.
Off-chain means any transaction or data that exists outside the blockchain. Because committing every transaction on-chain can be expensive and inefficient, third-party tools like oracles that handle pricing data, or layer 2 solutions that execute a higher throughput of transactions, handle the bulk of the processing work off-chain, and will submit information on-chain at less frequent intervals.
On-chain is an umbrella term that includes any transaction or data that is available on the blockchain and visible to all nodes on the blockchain network such as mempool data, historical transactions, and account information.
A layer two blockchain, functioning on top of Ethereum, which was founded in 2019 with the intent of processing transactions quicker and less expensive. Optimism’s networks include Mainnet and Goerli.
Is a property describing blockchains where no single entity can control who uses it.
Pre-consensus is another way to describe transactions that are currently in flight and not yet confirmed on the blockchain. Pre-consensus transactions are also known as pending transactions and pre-chain transactions.
Is a system of tracking and verifying attendance using NFTs. Intended for education, it transfers ownership of transcripts from educational institutions to the student.
Proof of Stake (PoS) is a decentralized consensus mechanism where selected validators stake the blockchain’s native currency in exchange for rewards they earn from validating transactions. PoS consensus economically incentivizes participants to behave correctly.
Proof of Work is the concept of requiring a non-insignificant but feasible amount of effort to produce some result. In Bitcoin, Ethereum, and many other crypto ledgers, this means finding a hash that is smaller than some target value. The reason this is necessary is that in a decentralized system anyone can produce blocks, so to prevent the network from being flooded with blocks, and to provide a way of measuring consensus behind a particular version of the blockchain, it must in some way be hard to produce a block. Because hashes are pseudorandom, finding a block whose hash is less than 0000000100000000000000000000000000000000000000000000000000000000 takes an average of 4.3 billion attempts. In all such systems, the target value self-adjusts so that on average one node in the network finds a block every N minute (e.g., N = 10 for Bitcoin).
A proof of work nonce is a technically meaningless (but super necessary) value in a block to show that the block satisfies the proof of work condition.
A crypto project that acts unethically towards its community. Most commonly interpreted as abandoning a project with all community funds.
The smallest denomination of Bitcoin (100M Satoshis equal 1 Bitcoin). Named after Satoshi Nakamoto (Bitcoin founder).
The process of splitting a blockchain into multiple smaller pieces. Each piece is called a 'shard'.
A person or group of people promoting a particular cryptocurrency to create excitement for it.
Is an extra key necessary to recover a digital wallet or to install one on a new device. Typically it consists of an ordered list of 12 randomly chosen words.
Refers to a digital wallet controlled through an app or browser extension.
A side chain is a blockchain that allows tokens from one blockchain to be securely used within a completely separate blockchain, but still move back to the original chain if necessary. Sidechains like xDai are popular because they offer distinct advantages to developers including cost savings and greater transaction speed.
A smart contract is a piece of code that executes according to it is instructions exactly like a traditional contract between two people would be executed. Smart contracts are used by developers to build decentralized applications on blockchain networks like Ethereum to enable users to permissionlessly transact in a secure way.
These wallets are accessed and controlled via smart contract code and two types are supported; externally owned accounts that are accessed via a private key or seed phrase and contract accounts that are controlled via smart contract. These are more like a traditional finance app and include features such as; multi-signature authorization, account freezing, transaction limits, 2FA, allow listing, and guardians.
A layer 1 blockchain founded in 2020 that is built on a concept called Proof of History (PoH) to enable scaling and affordability. Its native token is called SOL. Its network include Mainnet-Beta, Testnet, and Devnet.
Solidity is an object-oriented programming language for writing smart contracts. It is used for implementing smart contracts on various blockchain platforms, most notably, Ethereum.
Cryptocurrencies, where the price is designed to be pegged to a cryptocurrency, fiat money, or to exchange-traded commodities.
The process of locking digital assets on-chain, usually in exchange for earning some type of incentive (e.g. interest, token yield, etc.). Staking often comes with some type of risk--in proof-of-stake, validators' stake is at risk if the validator confirms illegitimate transactions.
A state channel is a layer 2 scaling solution. It allows off-chain transactions between users while only submitting the opening and closing transactions within the channel on-chain. This process significantly reduces costs and increases network throughput without compromising security.
A testnet (test network) is where developers can test protocol upgrades and smart contracts before deploying them on mainnet.
A tip is an 'optional' additional fee that is paid directly to miners by users to incentivize miners to include their transaction in the next block. Tips were added to Ethereum through an Ethereum Improvement Proposoal (EIP-1559).
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.
A portmanteau of the words 'token' and 'economics,' tokenomics refers to all the aspects of a cryptocurrency that can impact the price such as total supply, vesting, and utility.
Total Value Locked (TVL) is the total value of assets locked (i.e. being used) in a specific protocol. DeFi lending protocols like Compound Finance and decentralized exchanges like Uniswap use liquidity pools which lock assets in a vault, and therefore have a TVL.
When the entire block is accepted, or 'hashed,' by a miner the transaction is considered settled. As the new block propagates across the network, each node executes the transactions in the block and updates its current state. At this point, the transaction is confirmed on the blockchain.
Type 0 transactions are legacy transaction types from before the London hard fork in August 2021 which included the deployment of EIP-1559.
Type 2 transactions are based on the EIP-1559 upgrades and include Base Fee, Max Priority Fee, and Max Fee Per Gas fields instead of the Gas Price field.
A term commonly used to portray that a project or cryptocurrency will continue to succeed.
Often used to describe the functionality of a cryptocurrency or NFT.
A node that participates in a blockchain's consensus mechanism. Validators are responsible for processing transactions and verifying the state of a blockchain.
A wallet stores a user's private keys and allows them to transact digital assets and connect with decentralized applications. A wallet does not store digital assets, it stores the keys which prove ownership of assets that are recorded on the blockchain's digital asset ledger. Wallets come in two main varieties: software and hardware (physical) wallets.
Web 3.0, also spelled Web3, is the current evolution of the internet characterized by decentralization and digital ownership, unlike Web 1.0 and Web 2.0 which were characterized by users being able to read (Web 1.0) and write (Web 2.0) content.
An individual or entity holding a large amount of a cryptocurrency that can impact market prices.
Wrapped Ethereum (wETH) is a tokenized version of Ether on the ERC-20 standard. wETH can always be redeemed 1:1 for ETH. It enables functionality with Dapps on Ethereum and other blockchains.
Wrapped tokens allow users to transact with cryptocurrencies via blockchains or token standards outside their original design scope. Wrapped tokens are usually created by holding the original asset in a digital vault, then issuing a "wrapped" token representing the vault assets. They allow for greater interoperability between previously non-compatible digital assets.
A zero-knowledge proof is a method of verification in which a "prover" shows possession of secretive knowledge to a "verifier" without revealing the sensitive information itself. This encryption scheme can ensure data privacy and confidentiality on a public blockchain.
A ZK or "zero-knowledge" rollup is an Ethereum layer 2 scaling solution that bundles transactions off-chain into a single cryptographic proof. This transaction is then submitted back to the main chain for validation. ZK-rollups utilize validity proofs to confirm transaction legitimacy.
Sources: blocknative.com, alchemy.com, quicknode.com, cryptoWiki.me, heidicohen.com