Glossary
Proof of Stake
A consensus mechanism where validators lock capital as collateral for securing the chain.
Proof of stake secures a chain by requiring validators to lock up tokens as collateral. Misbehave, and the stake gets destroyed. Ethereum, Solana and most modern chains use it.
The trade-off versus proof of work is energy and cost, at the price of a different distribution of power: whoever holds the most tokens has the most influence.
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.