Need to explain crypto/defi terms to your grandma?
Here's a handy list of crypto-native terms with a 1-tweet ELI5 explainer for each.
Bookmark the thread and if you want something added, just ask!
1/n... oh God there's gonna be so many
Here's a handy list of crypto-native terms with a 1-tweet ELI5 explainer for each.
Bookmark the thread and if you want something added, just ask!
1/n... oh God there's gonna be so many
Smart contract:
Think of it as a computer program that does one specific thing, and it's always running, just waiting for you to send some basic instructions.
Think of it as a computer program that does one specific thing, and it's always running, just waiting for you to send some basic instructions.
dApp:
One or more smart contracts bundled together in the same place. They can be more complex than a single smart contract, but they usually have a user interface to help you send the right instructions to each smart contract
One or more smart contracts bundled together in the same place. They can be more complex than a single smart contract, but they usually have a user interface to help you send the right instructions to each smart contract
DeFi:
Short for decentralized finance, it's a category of dApps that deal with finance. Some have banking-type functions, some work more like a stock exchange but they all help you manage your own finances without needing someone else to do it for you.
Short for decentralized finance, it's a category of dApps that deal with finance. Some have banking-type functions, some work more like a stock exchange but they all help you manage your own finances without needing someone else to do it for you.
Yield:
A lot of DeFi apps need a pool of money or coins in order to function, kinda like your bank needs cash in the vault.
Some of these apps will offer yield, aka payment in exchange for letting them use your money.
A lot of DeFi apps need a pool of money or coins in order to function, kinda like your bank needs cash in the vault.
Some of these apps will offer yield, aka payment in exchange for letting them use your money.
Farming:
Sending your money to a dApp in order to earn yield.
There's a lot of different ways to farm, depending on what the dApp is using your money to do.
Sending your money to a dApp in order to earn yield.
There's a lot of different ways to farm, depending on what the dApp is using your money to do.
Liquidity mining (LP)
A way to farm.
The dApps that work like a stock exchange need to make sure they have coins and/or money in stock so users can buy and sell.
They'll offer yield if you let them use your coins and money for that purpose.
A way to farm.
The dApps that work like a stock exchange need to make sure they have coins and/or money in stock so users can buy and sell.
They'll offer yield if you let them use your coins and money for that purpose.
Staking:
Another way to farm.
Some dApps and blockchains store specific coins as a sort of security guarantee for their users (or for other reasons). If you send them that coin, they'll pay you for as long as you leave it there.
It's kinda like a high-interest savings account.
Another way to farm.
Some dApps and blockchains store specific coins as a sort of security guarantee for their users (or for other reasons). If you send them that coin, they'll pay you for as long as you leave it there.
It's kinda like a high-interest savings account.
Pool:
A smart contract that holds money or coins as part of a dApp.
Some pools have only one type of coin, some of them have lots. They're basically just storage, but they can also have conditions attached that determine how, if or when the coins can be removed.
A smart contract that holds money or coins as part of a dApp.
Some pools have only one type of coin, some of them have lots. They're basically just storage, but they can also have conditions attached that determine how, if or when the coins can be removed.
DAO:
An organization that uses smart contracts for members to propose and take votes about what they do.
Instead of a closed-door board meeting, votes and discussion are public, transparent and verifiable.
A DAO can also build, own or manage other smart contracts and dApps.
An organization that uses smart contracts for members to propose and take votes about what they do.
Instead of a closed-door board meeting, votes and discussion are public, transparent and verifiable.
A DAO can also build, own or manage other smart contracts and dApps.
Vault:
A secured pool that issues a receipt to depositors.
Sometimes the vaults are designed to automate farming tasks on behalf of the user but the receipts keep track of who owns what inside. Nobody can withdraw from a vault without the receipt.
A secured pool that issues a receipt to depositors.
Sometimes the vaults are designed to automate farming tasks on behalf of the user but the receipts keep track of who owns what inside. Nobody can withdraw from a vault without the receipt.
NFT:
A title of ownership. Each one is unique, cannot be counterfeited and includes a description of exactly what it represents ownership of.
They're usually attached to digital media, which was previously very difficult to prove the authenticity or ownership of.
A title of ownership. Each one is unique, cannot be counterfeited and includes a description of exactly what it represents ownership of.
They're usually attached to digital media, which was previously very difficult to prove the authenticity or ownership of.
DEX:
A type of dApp that lets users swap between coins. They allow the same functionality as a stock exchange, but 24/7 and without the need for a broker.
They also often offer farming rewards via Liquidity Mining, which makes them popular for both users and farmers.
A type of dApp that lets users swap between coins. They allow the same functionality as a stock exchange, but 24/7 and without the need for a broker.
They also often offer farming rewards via Liquidity Mining, which makes them popular for both users and farmers.
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