Glossary

The following is a glossary of terms used frequently in the Ardana Academy.

AML

Anti-money laundering (AML) refers to the activities that financial institutions undertake to comply with legal requirements to actively monitor and report suspicious activity.

AMM

Automated market makers (AMMs) allow digital assets to be traded without permission and automatically, using pools of liquidity instead of a traditional market with buyers and sellers. On a traditional exchange platform, buyers and sellers offer different prices for an asset.

Bitcoin

Bitcoin is a decentralized digital currency without a central bank or a single custodian that can be sent from user to user via the peer-to-peer Bitcoin network without intermediaries.

Blockchain

Blockchain is a shared, immutable ledger that facilitates the recording of transactions and tracking of assets across a business network.

Blockchain Database

A blockchain database is a cross between a traditional database and distributed database where data is transacted and recorded.

Blocks

A blockchain is a chain of blocks that contain information. The Genesis block is the first link in the chain. Each new block in the chain is connected to the one before it.

Cardano

Cardano is a public blockchain platform. It is open-source and decentralized, with consensus achieved through proof of stake. It can enable peer-to-peer transactions using its internal cryptocurrency, ADA. Cardano was founded in 2015 by Ethereum co-founder Charles Hoskinson.

CeFi

Centralized finance (CeFi) offers some of the yield benefits of DeFi with the ease of use and security of traditional financial services products. With CeFi, you can earn interest on savings, borrow money, spend with a crypto debit card, and more.

DANA

The Ardana token (DANA) is the utility and governance token of the Ardana ecosystem.

Danaswap

Danaswap is Ardana's DEX and will provide liquidity to stablecoins and later facilitate foreign exchange on Cardano. The protocol will support a range of currencies, including the U.S. Dollar (USD), British Pound (GBP), and Euro (EUR).

Dapps

Decentralized applications—also known as "dApps" or "dapps"—are digital applications that run on a blockchain network of computers instead of relying on a single computer. Because dApps are decentralized, they are free from the control and interference of a single authority.

DeFi

Decentralized Finance (DeFi) is a blockchain-based form of finance that does not rely on centralized financial intermediaries such as brokers, exchanges, or banks to offer traditional financial instruments but instead uses smart contracts on blockchains.

DEX

Decentralized exchanges (DEX) are a type of cryptocurrency exchange that allows direct peer-to-peer cryptocurrency transactions to be conducted online securely and without the need for an intermediary.

DLT

DLT (distributed ledger technology) is a decentralized database managed by multiple participants across multiple nodes. Blockchain is a type of DLT where transactions are recorded with an immutable cryptographic signature known as a hash.

Ethereum

Ethereum is a decentralized blockchain platform that securely executes and verifies application code called smart contracts. A sender must sign transactions and spend Ether, Ethereum's own cryptocurrency, as the cost of processing transactions on the network.

Fiat Currency

Fiat money is legal tender whose value is tied to a government-issued currency, such as the U.S. dollar, while cryptocurrency is a digital asset that derives its value from its own blockchain.

Forex

Foreign exchange (or forex) is the conversion of one country's currency into another. The value of a country's currency in a free economy is determined by supply and demand principles. Additionally, the value of a currency may be tied to the currency of another country, such as the U.S. dollar or even a basket of currencies. The government of a country may also set the value of its currency.

Gas Fee

Gas fees are payments made by users to compensate for the computational energy required to process and validate transactions on the Ethereum blockchain. "Gas limit" refers to the maximum amount of gas (or energy) you are willing to spend on a given transaction.

Hash

A hash is part of a block. It can be thought of as a unique fingerprint for each block. It uniquely identifies a block and all of its contents. As a result, any change within the block will modify the hash once a block is created.

Immutability

Immutability can be described as the ability of a blockchain ledger to remain immutable and unchanged. This means that the data stored in a blockchain cannot be changed.

Interoperability

Blockchain interoperability is defined as the process of operations between two or more blockchains. Each blockchain stores different types of data and transactions. Interoperability allows blockchains to share and access their data and interact with each other.

KYC

KYC stands for "Know Your Customer" and refers to the process of verifying the identity of customers. This is required when opening an account with a centralized financial institution.

Liquidity

Liquidity is the ability of a coin to be easily exchanged for cash or other coins. Liquidity is important for all tradable assets, including cryptocurrencies. The definition of liquidity is essentially the ability of an asset to be quickly converted into cash.

Liquidity Pool

A liquidity pool is a crowdsourced pool of cryptocurrencies or tokens locked into a smart contract that is used to facilitate trading between assets on a decentralized exchange (DEX).

Liquidity Provider

A liquidity provider is a user who deposits crypto assets into a liquidity pool in order to enable trading on the platform and receive passive revenue on her investment.

Maker

Maker is a smart contract platform on the Ethereum blockchain. It has two tokens available: DAI and Maker Governance (both algorithmically linked to $1).

Mining

Blockchain mining involves adding transactions to the existing blockchain ledger, which is distributed among all users of a blockchain.

Nodes

Blockchain nodes store a complete copy of the distributed ledger and are responsible for the reliability of the stored data. The nodes are used by developers to create blockchain-based applications. 

Ouroboros

Ouroboros is a family of proof-of-stake blockchain consensus protocols that can run both permissionless and permission blockchains.

P2P

P2P (peer-to-peer) is a technology-based on the concept of decentralization. The peer-to-peer architecture of the blockchain allows all cryptocurrencies to be transferred globally without the need for intermediaries or central servers.

Proof-of-Stake

Proof-of-Stake (PoS) is a type of consensus mechanism used to validate cryptocurrency transactions. In this system, cryptocurrency holders can stake their coins, which gives them the right to verify and add new transaction blocks to the blockchain.

Proof-of-Space

Proof of Space, often known as PoSpace, is a network consensus system that works in a similar way to Proof of Work. PoSpace validates transactions using disk storage rather than computing resources.

Proof-of-Work

Proof-of-Work (PoW) is the original consensus algorithm in a blockchain network. In Blockchain, this algorithm is used to confirm transactions and generate new blocks for the chain. In PoW, miners compete against each other to complete transactions on the network and get rewarded for it.

Protocol

Protocols are basic sets of rules that allow data to be shared securely between computers.

Scalability

When a blockchain system is said to be scalable, it means that the system achieves a higher TPS than some existing systems by modifying its consensus mechanism and/or adjusting some system parameters.

Sharding

Sharding is the process of splitting a blockchain into different blockchains. Multiple blockchains in Ethereum 2.0 are often referred to as shards.

Smart Contract

A smart contract is a computer program or transaction log used to automatically execute, control, or document legally relevant events and actions in accordance with the terms of a contract or agreement.

Solidity 

Solidity is a programming language for writing smart contracts. It is used to implement smart contracts on various blockchain platforms, most notably Ethereum.

Stablecoin

A stablecoin is a type of cryptocurrency backed by a reserve asset that aims to guarantee price stability. The dollar is the reference value for most stablecoins now in existence, although many are also tied to other government-issued fiat currencies such as the Euro and the Yen. As a result, the price of stablecoins fluctuates minimally, unlike other well-known cryptocurrencies.

Stake Pool

A staking pool allows multiple stakeholders to combine their computational resources to increase their chances of receiving a reward. Basically, they pool their effort in verifying and validating new blocks so that they have a higher probability of receiving the block rewards.

Tokenomics

The study of the economics of crypto-tokens or cryptocurrencies is called tokenomics. It basically involves the study of the factors that affect the demand and supply of tokens. The factors include quality, distribution, and production of crypto tokens.

Yield Farming

Yield farming involves lending or staking cryptocurrency in exchange for interest and other rewards. Yield farmers measure their returns in terms of annual percentage yields (APY).