50 DeFi Terms

Core DeFi Concepts

1. DeFi (Decentralized Finance): Financial services on the blockchain.
2. Smart Contract: Self-executing code on a blockchain.
3. dApp (Decentralized Application): An application running on a blockchain.
4. Token: A digital asset built on an existing blockchain.
5. Utility Token: A token with specific use cases within a platform.
6. Governance Token: A token that grants voting rights in a decentralized system.
7. Stablecoin: A cryptocurrency pegged to a stable asset like fiat currency.
8. NFT (Non-Fungible Token): A unique digital asset representing ownership.
9. Liquidity: The ease of buying or selling an asset without affecting its price.
10. Yield: The return on investment from DeFi activities.

DeFi Protocols

11. Lending Protocol: A platform for borrowing and lending cryptocurrencies.
12. Borrowing: Taking out a loan in cryptocurrency.
13. Lending: Providing cryptocurrency for others to borrow.
14. Collateral: Assets pledged to secure a loan.
15. Overcollateralization: Providing more collateral than the loan amount.
16. Under-collateralization: Providing less collateral than the loan amount.
17. Flash Loan: A loan that must be repaid within the same transaction.
18. Interest Rate: The cost of borrowing or the return on lending.
19. APY (Annual Percentage Yield): The annual return on investment.
20. APR (Annual Percentage Rate): The annual interest rate.

DeFi Trading

21. DEX (Decentralized Exchange): A peer-to-peer crypto exchange.
22. Order Book: A list of buy and sell orders on an exchange.
23. Market Order: An order to buy or sell immediately at the current price.
24. Limit Order: An order to buy or sell at a specific price.
25. Stop-Loss Order: An order to sell when the price drops to a certain level.
26. Take-Profit Order: An order to sell when the price reaches a certain level.
27. Spread: The difference between the buy and sell price.
28. Slippage: The difference between expected and actual trade prices.
29. Impermanent Loss: Loss experienced by liquidity providers due to price changes.
30. Arbitrage: Profiting from price differences across markets.

DeFi Yield Strategies

31. Yield Farming: Earning rewards by providing liquidity.
32. Liquidity Mining: Rewarding users for adding liquidity to a pool.
33. Staking: Locking up tokens to support network operations.
34. Staking Rewards: Earnings from staking tokens.
35. Liquidity Pool: A pool of tokens used for trading on decentralized exchanges.
36. AMM (Automated Market Maker): Algorithmic trading on decentralized exchanges.
37. LP Token (Liquidity Provider Token): A token representing a share in a liquidity pool.
38. Vesting: Locking up tokens for a specific period before release.
39. Token Burn: Permanently removing tokens from circulation.
40. Token Swap: Exchanging one token for another.

DeFi Security

41. Smart Contract Audit: Reviewing smart contracts for security.
42. Bug Bounty: Rewards for finding vulnerabilities in DeFi code.
43. Governance Attack: Exploiting governance mechanisms for malicious purposes.
44. Sybil Attack: Creating fake identities to influence governance.
45. Whitelisting: Allowing only specific addresses to participate in DeFi.
46. Blacklisting: Preventing specific addresses from participating in DeFi.
47. Emergency Proposal: A proposal to address urgent issues.
48. Pause Function: A mechanism to halt DeFi operations in case of an emergency.
49. Upgradeability: The ability to update DeFi smart contracts.
50. Decentralization: Distributing control away from a central authority.