GLOSSARY OF BLOCKCHAIN TERMS

Blockchain is a shared, immutable ledger that facilitates the process of recording transactions and tracking assets in a business network. Virtually anything of value (tangible or intangible) can be tracked, traded, and verified on a blockchain network.

Web3 is built on the foundation of blockchain technology and is the effectively the third generation of the world wide web. It is effectively a multi-user virtual environment where individuals build applications, interact, and monetize themselves and their digital assets.

The transfer of authority and responsibility from a centralised organisation such as a bank or government, to a distributed network of people.

Crypto wallet is where you store your crypto assets. A crypto wallet can be ‘hot’, meaning that it is located online, or ‘cold’, meaning that it is offline storage on an encrypted hard drive.

Exchange tokens are coins or currencies that represent value on their own and are used for investment or transacting.

Example: Bitcoin

Stable tokens are often ‘pegged’ to to a currency like the U.S. dollar or to the price of a commodity such as gold and pursue price stability by maintaining reserve assets as collateral or through algorithmic formulas that are supposed to control supply.

Example: TerraUSD

NFTs are a unique digital certificate of a digital asset, and the key with NFTs are that they are indivisible. NFTs are created using smart contracts on a blockchain. Their value usually derives from the rights attaching to the underlying assets.

Example: Bored Ape Yacht Club.

Utility tokens provide the holder of that token with access to certain goods or services, or the ability to use that token as payment for such goods or services.

Example: DentaCoin

DAO stands for Decentralised Autonomous Organisation. A DAO is organisation that operates on decentralised blockchain infrastructure, which means that the organisation encodes its rules and governance on a blockchain network.

Example: UkraineDAO and FlamingoDAO

An ICO is an Initial Coin Offering. An ICO is effectively a vehicle for companies to raise capital.

DeFi refers to Decentralised Finance. DeFi aims to remove the role and control of central banks in transactions and lending by facilitating a peer-to-peer financial network. Payments in the peer-to-peer network are made via a decentralised application, or dApp, and follow the same process in the blockchain.