DeFi
Decentralized finance or DeFi is an emerging financial technology based on secure distributed ledgers used by blockchains.
In the U.S., the Federal Reserve and Securities and Exchange Commission (SEC) define the rules for centralized financial institutions like banks and brokerages, which consumers rely on to access capital and financial services directly. DeFi challenges this centralized financial system by empowering individuals with peer-to-peer transactions.
CEX
A centralized exchange or CEX is a type of cryptocurrency exchange platform. CEX platforms maintain an order book for buy and sell orders between traders. CEX’s are owned and operated by private companies, which means it is subject to the laws and regulations of every jurisdiction it operates in. A CEX requires users to sign up and open an account to participate, and a majority of CEXs demand Know-your-Customer/Anti-Money Laundering (KYC/AML) ID verification to trade.
Dex
A decentralized exchange or DEX is a peer-to-peer marketplace where transactions occur directly between crypto traders. DEXs fulfil one of crypto's core possibilities: fostering financial transactions that aren't officiated by banks, brokers, or any other intermediary.
Typically, DEXs are not subject to users signing up and opening an account to trade and do not demand Know-your-Customer/Anti-Money Laundering (KYC/AML) ID verification to trade.
Proof-of-Stake (PoW)
Unlike the Bitcoin blockchain which uses a Proof-of-Work (PoW) consensus, the Entangle blockchain uses a Proof-of-Stake (PoS) consensus. Proof-of-Stake is a type of consensus protocol that relies on a network of validator with similar responsibilities to miners on the Bitcoin blockchain. Ordering transactions and creating new blocks that have to be agreed upon by all parties before being added to the blockchain.
Benefits of PoS over PoW
- The amount of energy needed to mine blocks is much lower.
- A stronger case for decentralisation due to the larger number of independent nodes in the network.
- Environmentally friendly.
- Requires less computing power.
Staking
Staking is when you lock crypto assets for a set period of time to help support the operation of a blockchain. In return for staking your tokens, you earn more tokens as a form of rewards.
Many blockchains, like Entangle, use a Proof-of-Stake consensus mechanism. Under this system, network participants who want to support the blockchain by validating new transactions and adding new blocks must “stake” or “delegate” any amount of their crypto assets.
Staking helps ensure that only legitimate data and transactions are added to a blockchain. Participants trying to earn a chance to validate new transactions offer to lock up sums of cryptocurrency in staking as a form of insurance. Currently, the Entangle blockchain offers a 8% APY for staking your $NGL tokens.
Vesting
Vesting in the crypto markets refers to the process where ownership of crypto tokens is gradually transferred over a period of time based on specific criteria's. Initially, the tokens are locked and over time, they become unlocked allowing transfers, sale or use of the tokens.
LP Token
Liquidity Provider Tokens or LP Tokens for short, are a reward mechanism to help facilitate transactions between other different types of currencies. Decentralized exchanges rely on Liquidity Providers to ensure there is an always-on market for the trading of cryptocurrencies.
An LP token is a crypto token given to users who loan their crypto to a liquidity pool. The LP tokens represent a user's share of the pool and can always be redeemed for the original tokens. Liquidity pools enable users to easily swap one token for another on a decentralized exchange.
Transaction Hash
A transaction hash is a string of letters and numbers that is generated when a cryptocurrency transaction is initiated. It is a unique identifier that is used to track the transaction on the blockchain. Every transaction that occurs on the blockchain is recorded as a block, and each block has a unique hash. You can search for any transaction using the Entangle block explorer using your unique transaction hash.
Example: 689E802AA0B885E02CC9B225CA96237C3AEAE1EE3B24B4EBA5E28D25BEB30DA7
Block Explorer
A blockchain explorer or block explorer allows users to access details related to specific transactions on specific blockchains and wallet addresses. The details include the amounts sent or received, sources and destinations of funds, and the status of the transactions themselves.
You can search for any transaction on the Entangle blockchain via the Entangle block explorer.
Validator
A validator is a participant of a Proof-of-Stake or PoS blockchain network. As part of the PoS consensus mechanism which the Entangle blockchain uses, validators are responsible for verifying new blocks and adding them to the chain to earn rewards.
Delegator
Delegators are users who lock up a stake of their crypto assets for a period of time and delegate it to validators to secure and record new crypto transactions on the blockchain. The delegator role enables users to participate in staking without staking the full amount required to become a validator. In return for delegating their tokens, they earn more crypto tokens as a form of reward. The Entangle blockchain currently offers an 8% APY for staking the native $NGL token.
You can start staking or delegating your $NGL tokens here.
Airdrop
An airdrop is a marketing strategy that involves sending free coins or tokens to wallet addresses. Small amounts of a new token are sent to the wallets of active members of the blockchain community for free in return for a small service, such as staking a different token or retweeting a post sent by the company issuing the new token. The ultimate goal of an airdrop is to promote awareness and circulation of a new token or coin.
Bridging
Bridging in crypto refers to the process of transferring crypto assets between different blockchain networks.
Example: Although $NGL is native to the Entangle blockchain, you can send $NGL tokens from the Entangle blockchain to the Ethereum blockchain via the Entangle bridge.