Glossary to the Cryptoeconomy
- Address: An alphanumeric reference to where crypto assets can be sent or stored.
- Block: Synonymous with digital pages in a ledger. Blocks are added to an existing blockchain as transactions occur on the network. Miners are rewarded for “mining” a new block.
- Blockchain: A cryptographically secure digital ledger that maintains a record of all transactions that occur on the network and follows a consensus protocol for confirming new blocks to be added to the blockchain.
- Cold storage: The storage of private keys in any fashion that is disconnected from the internet. Common cold storage examples include offline computers, USB drives, or paper records.
- Crypto: A broad term for any cryptography-based market, system, application, or decentralized network.
- Crypto asset (or ‘token’): Any digital asset built using blockchain technology, including cryptocurrencies, stablecoins, and security tokens.
- Cryptocurrency: Bitcoin and alternative coins, or ‘altcoins’, launched after the success of Bitcoin. This category of crypto asset is designed to work as a medium of exchange, store of value, or to power applications and excludes security tokens.
- Cryptoeconomy: A new open financial system built upon crypto.
- Decentralized Autonomous Organization (DAO): a virtual entity that has a certain number of members or shareholders who collectively determine where the organization will allocate funds and how its operations will be structured.
- DeFi: Short for Decentralized Finance. Peer-to-peer software-based network of protocols that can be used to facilitate traditional financial services like borrowing, lending, trading derivatives, insurance, and more through smart contracts.
- Ecosystem/DeFi partners: Developers, creators, merchants, asset issuers, organizations and financial institutions, and other groups building decentralized protocols, applications, products, or other services for the cryptoeconomy.
- Ethereum: A decentralized global computing platform that supports smart contract transactions and peer-to-peer applications, or “Ether,” the native crypto assets on the Ethereum network.
- Fork: A fundamental change to the software underlying a blockchain which results in two different blockchains, the original, and the new version. In some instances, the fork results in the creation of a new token.
- Hodl: A term used in the crypto community for holding a crypto asset through ups and downs, rather than selling it.
- Hot wallet: A wallet that is connected to the internet, enabling it to broadcast transactions.
- Miner: Individuals or entities who operate a computer or group of computers that add new transactions to blocks, and verify blocks created by other miners. Miners collect transaction fees and are rewarded with new tokens for their services.
- Mining: The process by which new blocks are created, and thus new transactions are added to the blockchain.
- Network: The collection of all miners that use computing power to maintain the ledger and add new blocks to the blockchain. Most networks are decentralized, reducing the risk of a single point of failure.
- Protocol: A type of algorithm or software that governs how a blockchain operates.
- Public key or private key: Each public address has a corresponding public key and private key that are cryptographically generated. A private key allows the recipient to access any funds belonging to the address, similar to a bank account password. A public key helps validate transactions that are broadcasted to and from the address. Addresses are shortened versions of public keys, which are derived from private keys.
- SharedStake Governance Token (SGT): the token for use in the SharedStake DAO and throughout SharedStake and DeFi partner products.
- Smart contract: Software that digitally facilitates or enforces a rules-based agreement or terms between transacting parties.
- Stablecoin: Crypto assets designed to minimize price volatility. A stablecoin is designed to track the price of an underlying asset such as fiat money or an exchange-traded commodity (such as precious metals or industrial metals). Stablecoins can be backed by fiat money or other crypto assets.
- Staking: An energy efficient equivalent of mining. Stakers use pools of tokens as collateral to validate transactions and create blocks. In exchange for this service, stakers earn a reward. On Ethereum, staking involves depositing 32 ETH to activate validator software to keep the network secure for everyone.
- Uniswap is the first main exchange where you can swap ETH or other digital assets for SGT. You can also add liquidity to stake and receive additional yield.
- vEth2 is the liquid representation of staked Ether. vEth2 is the SharedStake token that earns additional yield compared to traditionally staked ether.
- Wallet: A place to store public and private keys for crypto assets. Wallets are typically software, hardware, or paper-based.