Glossary
Liquidity Mining
Extra token rewards paid to people who deposit into a liquidity pool.
Liquidity mining pays extra tokens to people who deposit into a pool, on top of normal trading fees. Protocols use it to bootstrap liquidity fast, since traders go where depth already exists.
The catch is that rewards are usually paid in the protocol's own token. If that token falls faster than you earn it, a headline 200% APY can still lose you money.
Related terms
Airdrop
Free tokens distributed to wallet addresses, usually to reward early users of a protocol.
AMM
Automated Market Maker — a protocol that prices assets with a formula instead of an order book.
APR vs APY
APR is the yearly rate without compounding; APY includes compounding and is always higher.
ATH
All-Time High — the highest price an asset has ever traded at.
Bear Market
A prolonged decline, conventionally 20% or more from recent highs.
Bull Market
A prolonged rise driven by new demand, easy credit and rising confidence.