Glossary

Airdrop

An airdrop is a marketing strategy that involves sending coins or tokens to wallet addresses to promote awareness. Small amounts of the cryptocurrency are sent to the wallets of active community members for free or in return for a small service, such as retweeting a post sent by the company issuing the currency.

BEP-20

BEP-20 is a token standard on Binance Smart Chain that extends ERC-20, the most common Ethereum token standard. You can think of it as a blueprint for tokens that define rules for their usage, such as who can spend them, how they can spend them etc. Due to its similarity to Binance Chain’s BEP-2 and Ethereum’s ERC-20, it’s compatible with both.

Boom and Bust Cycle

Traditionally, the boom and bust cycle is a process of economic expansion and contraction that occurs repeatedly. It is a crucial characteristic of a capitalist economy. Such cycles are also highly prevalent in the cryptocurrency space.

BSC

Binance Smart Chain, or BSC, is a blockchain made to run smart contracts. It works in parallel with Binance Chain, Binance’s first blockchain used on its non-custodial exchange. Learning from the shortcomings of Ethereum, Binance focused on preventing network congestion in its design. The consensus algorithm on BSC is currently PoSA (Proof of Staked Authority) and is a variant of Ethereum’s “PoS” (proof-of-stake) algorithm.

Burn

Burning is the process of permanently removing cryptocurrencies from circulation, reducing the total supply. It can be done in several ways, most commonly by sending the coins to a so-called “eater address”: its current balance is publicly visible on the blockchain, but access to its contents is unavailable to anyone.

Cryptocurrency Exchange

A cryptocurrency exchange allows customers to trade cryptocurrencies (typically for other cryptocurrencies or conventional fiat money). It operates on an order-book model, i.e. it takes the asks (sell orders) and bids (buy orders) at different price levels of an asset to determine the market price.

Latency

Latency is a measure of delay. In blockchain terms, it refers to the time between submitting a transaction to a network and the first confirmation of acceptance by the network.

Liquidity Pool

A liquidity pool is a smart contract that pairs two compatible assets valued relative to one another.

Throughput

Throughput measures how many actions are completed within a given time frame. In blockchain terms, transaction throughput refers to the rate of how fast a blockchain processes transactions.

Tokenomics

The study of the economics of cryptocurrencies is called tokenomics. It fundamentally involves the issuance and distribution of tokens. Some of the factors that impact the demand and supply of tokens include utility, market cap, token distribution, total supply, circulating supply etc.

PancakeSwap

PancakeSwap is a type of decentralised exchange (DEX) known as an automated market maker (AMM). Instead of a traditional order book model, assets are traded, and the price is determined using liquidity pools. Users trading on the platform automatically draw liquidity from one or more liquidity pools, rebalancing after the trade is complete.