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Explore approved Crypto definitions, everyday examples and related lessons.
Showing 9 of 9 matching terms
An ordered set of words used by a compatible wallet to derive recovery keys. A BIP 39 wallet may also require its exact passphrase; multisig recovery may require other keys. Treat recovery material as secret.
Example: A recovery backup is closer to a master access secret than a customer account number. Its words, order and any additional recovery requirements matter; never give it to someone claiming to be support.
A fraud in which a criminal takes control of your phone number by persuading or bribing your mobile provider to move it to a SIM card they hold.
Example: A criminal persuades a mobile provider to redirect your number to another SIM. They may then receive text verification codes; SMS access is not the same as secure control of your recovery material.
A penalty in proof of stake that destroys part of a validator's deposit when it provably breaks the rules, for example by voting for two conflicting blocks.
Example: A referee penalises a participant for a specific rule violation. In Ethereum staking, conflicting signed votes can trigger slashing; ordinary downtime penalties are a different mechanism.
Keep in mind: The two retained source contexts overlap. Network specific rules decide the penalty and validator exit; ordinary downtime is not necessarily slashable.
In Ethereum proof of stake, a penalty for specified conflicting block proposals or votes that destroys some staked ETH and forces the validator to exit. Other networks have their own offences, penalties and exit rules.
The difference between an expected or quoted execution outcome and the outcome actually obtained. It may be favourable or adverse; compare compatible price and quantity references.
Example: An invented quote estimates 100 tokens received, but execution produces 98. The difference must be checked against the quote and its stated terms.
Keep in mind: Slippage tolerance is an execution limit, not a guaranteed final outcome.
A blockchain program whose rules execute when called under the network conditions. It can move assets or update records, but may contain bugs or depend on administrator permissions, upgrades and external data.
Example: A programmed vending rule checks an input before updating records. The rule can still contain a mistake or administrator powers, so automatic operation is different from guaranteed safety.
The difference between the highest price a buyer is offering (best bid) and the lowest price a seller is asking (best ask).
Example: An invented best bid is USD 99 and best ask is USD 101. The spread is USD 2; fees and the available quantity can add further execution costs.
A crypto token designed to hold a steady value against a reference, usually a national currency such as the US dollar. Stablecoins aim to hold a peg; they carry no guarantee and are not bank deposits.
Example: A token aims to stay near one US dollar. If it trades at USD 0.94, the reference remains one dollar but the market price has moved away from it.
Treating money, time or effort already spent as a reason to keep going, even though that past cost cannot be recovered by continuing.
Example: A prepaid cinema ticket tempts you to stay even when you feel unwell. The past payment cannot decide whether staying is the best choice now.
A stated upper supply limit under an asset’s current rules. Bitcoin’s current issuance rules limit newly created BTC to about 21 million units. A cap is different from circulating supply and does not guarantee demand or value.
Example: A Bitcoin learner separates the supply rule from market demand. A finite supply does not make any particular future price certain.
Keep in mind: The Bitcoin supply statement refers to its current consensus rules. A cap does not guarantee value, liquidity or future demand.