Account-to-Account Payments (A2A)
Direct bank-to-bank transfers that bypass card networks, reducing costs for merchants and enabling instant settlement.
ACH Transfer
The Automated Clearing House network processes batch electronic payments in the US, handling payroll, bills, and bank transfers.
Acquirer (Acquiring Bank)
The bank or financial institution that processes card payments on behalf of a merchant, managing settlement and risk.
Address Gap Limit
The number of consecutive unused addresses a wallet scans before stopping, affecting fund discovery in HD wallets.
Algorithmic Stablecoin
A stablecoin that maintains its peg through automated supply adjustments rather than collateral reserves.
Anchor Outputs
Special outputs in Lightning commitment transactions that enable dynamic fee bumping during force closes, solving fee volatility issues in channel disputes.
Asset-Referenced Tokens (ARTs)
A MiCA-defined category of crypto-assets that maintain stable value by referencing multiple currencies, commodities, or other assets, subject to strict EU reserve and governance requirements.
Atomic Multipath Payments (AMP)
A Lightning Network payment protocol that splits large payments across multiple paths using cryptographic secret sharing, ensuring all parts arrive or none do.
Atomic Swap
A trustless exchange of cryptocurrencies between two parties where either both transfers complete or neither does.
Authorization and Capture
The two-step card payment process: first reserving funds (authorization), then collecting them (capture) when the order is fulfilled.
Autoloop
An automated liquidity management system that uses rules-based submarine swaps to maintain optimal channel balances on Lightning Network nodes.
BACS Payments
The UK's bulk payment system processing direct debits and credits with a 3-day clearing cycle for payroll and recurring payments.
Banking-as-a-Service (BaaS)
API-driven platforms that let non-bank companies embed banking features like accounts, cards, and payments into their products.
Bech32 and Bech32m
Human-readable address encoding formats for SegWit and Taproot Bitcoin addresses, with error detection and no mixed-case confusion.
BIN (Bank Identification Number)
The first 6-8 digits of a payment card number that identify the issuing bank, card brand, and card type.
BIP-174 (PSBT Format)
The specification for Partially Signed Bitcoin Transactions, enabling offline signing and multi-party transaction construction.
BIP-32 (HD Wallets)
The Bitcoin Improvement Proposal defining hierarchical deterministic key derivation from a single master seed.
BIP-327 (MuSig2)
The specification for MuSig2, a two-round Schnorr multisignature protocol that produces a single aggregated signature indistinguishable from a regular single-signer signature on-chain.
BIP-340 (Schnorr Signatures for Bitcoin)
The specification defining how Schnorr signatures work in Bitcoin, using the secp256k1 curve with x-only public keys.
BIP-341 (Taproot Spending Rules)
The specification defining Taproot's output structure, key-path spending, and script-path spending via Merkle branches.
BIP-342 (Tapscript)
The specification defining the updated script validation rules for Taproot's script-path spending, with improved opcodes.
BIP-39 (Mnemonic Seed Phrases)
The standard defining how mnemonic word lists encode wallet seeds, enabling human-readable backup of Bitcoin keys.
BIP-44 (Multi-Account Hierarchy)
A standard derivation path structure for HD wallets, organizing keys by purpose, coin type, and account for interoperable wallet recovery.
BIP-47 (Reusable Payment Codes)
A protocol enabling reusable Bitcoin addresses through payment codes, improving privacy while maintaining a static identifier.
BIP-84 (Native SegWit Derivation)
The standard derivation path for native SegWit (bech32) addresses, using m/84'/0'/0' for the most fee-efficient Bitcoin address format.
BIP-86 (Taproot Derivation)
The standard derivation path for Taproot (P2TR) addresses, using m/86'/0'/0' for key-path-only spending.
Bitcoin Script
A stack-based programming language used to define spending conditions for Bitcoin outputs.
Blinded Paths
A privacy feature that hides the final destination of a payment by providing an encrypted route from an introduction point.
Block Subsidy
The newly minted Bitcoin awarded to miners for successfully mining a block, halving approximately every four years.
BOLT Specifications
The Basis of Lightning Technology documents that define the Lightning Network protocol standards.
BOLT-12 Offers
A new Lightning invoice format that enables reusable payment requests, subscriptions, and enhanced privacy through blinded paths.
BRC-20
An experimental fungible token standard on Bitcoin using Ordinals inscriptions to track token deployments, mints, and transfers.
Buy Now, Pay Later (BNPL)
A point-of-sale financing option that splits purchases into interest-free installments, offered by providers like Klarna and Affirm.
Card Network
Companies like Visa and Mastercard that set rules, route transactions, and provide infrastructure connecting card issuers and acquirers.
CBDC (Central Bank Digital Currency)
A digital form of a country's fiat currency issued directly by the central bank, aiming to modernize money and payments.
Channel Capacity
The total amount of Bitcoin locked in a Lightning channel, representing the maximum that can be transferred in either direction.
Channel Factory
A proposed multi-party channel setup that enables efficient batch opening and closing of Lightning payment channels, significantly reducing on-chain footprint and improving scalability.
Channel Reserve
The minimum balance that must be maintained in a Lightning Network channel to ensure both parties can cover potential closure fees and prevent gaming the system.
Chantools
A command-line toolkit for Lightning Network channel recovery and troubleshooting, used to rescue funds from stuck, force-closed, or corrupted channels.
CHAPS Payments
The UK's real-time gross settlement system for high-value sterling payments, operated by the Bank of England.
Chargeback
A forced transaction reversal initiated by a cardholder's bank, designed to protect consumers but costing merchants billions annually.
Child-Pays-for-Parent (CPFP)
A fee-bumping technique where spending an unconfirmed output with a high-fee transaction incentivizes miners to include both.
CHIPS (Clearing House Interbank Payments System)
The Clearing House Interbank Payments System processes large-value US dollar payments between banks, settling $1.8 trillion daily.
Circular Rebalance
A Lightning Network liquidity management technique where node operators send payments to themselves through external routes to shift channel balances.
Clearing
The process of reconciling and netting payment obligations between banks before final settlement of funds.
Closed-Loop Payment System
A payment network where the same entity controls issuance, processing, and settlement, like a gift card or proprietary wallet.
Coinbase Transaction
The first transaction in every Bitcoin block that creates new coins as the mining reward and collects transaction fees.
Cold Storage
Storing cryptocurrency private keys on devices that are never connected to the internet, maximizing security against remote attacks.
Commodity-Linked Synthetics
Digital assets that track the price of physical commodities like gold, silver, or oil through derivative mechanisms rather than direct physical backing.
Core Banking System
The central software platform that processes a bank's transactions, maintains accounts, and handles the ledger of record.
Correspondent Banking
A network of banking relationships enabling cross-border payments by routing funds through intermediary banks.
Covenant
A proposed Bitcoin feature that would allow outputs to restrict how they can be spent in future transactions.
Cross-Border Payments
Financial transactions where the payer and recipient are in different countries, involving currency conversion and multiple intermediaries.
Cross-Chain Bridge
A protocol enabling asset or data transfer between different blockchains, with varying trust assumptions.
crvUSD Stablecoin
Curve Finance's stablecoin using a novel soft-liquidation mechanism called LLAMMA that gradually converts collateral instead of hard liquidations.
DAI Stablecoin
A decentralized stablecoin generated by locking collateral in MakerDAO smart contracts, maintaining a soft dollar peg through overcollateralization and algorithmic stability mechanisms.
Death Spiral
A self-reinforcing collapse mechanism in algorithmic stablecoins where falling prices trigger panic redemptions, further crashing the price until the peg breaks irreversibly.
Depeg Event
When a stablecoin's market price diverges significantly from its target peg, often triggering panic and further instability.
Derivation Path
A hierarchical path specifying how to derive a specific key from a master seed in an HD wallet.
Difficulty Adjustment
Bitcoin's automatic mechanism to maintain approximately 10-minute block intervals by adjusting the mining difficulty every 2016 blocks.
Direct Debit
A recurring pull payment arrangement where a business is authorized to collect payments directly from a customer's bank account.
Disbursement
The outward payment of funds from a business to individuals, including payroll, refunds, insurance payouts, and vendor payments.
Dollar-Denominated Savings
Using dollar-pegged stablecoins as a savings vehicle in countries with high inflation or limited banking access.
Double Spend
An attack where the same Bitcoin is spent in two conflicting transactions, attempting to defraud a recipient.
Dust Attack
Sending tiny amounts of Bitcoin to many addresses to track spending patterns and deanonymize users when dust is consolidated.
E-Money License (EMI)
A European license authorizing companies to issue electronic money and provide payment services across the EU.
E-Money Tokens (EMTs)
A type of stablecoin under MiCA regulation that is pegged to a single fiat currency and backed by reserves, functioning as a digital representation of electronic money.
Eclipse Attack
An attack isolating a node by controlling all its peer connections, enabling double spends or selfish mining against that node.
Eltoo
A proposed Lightning Network channel update mechanism using SIGHASH_ANYPREVOUT that simplifies state management by allowing any later state to replace any earlier state.
Embedded Finance
Integrating financial services like payments, lending, or insurance directly into non-financial apps and platforms.
Ephemeral Dust
Temporary dust outputs in Lightning commitment transactions that allow channels to use their full balance without reserving funds for on-chain fees.
EURC (Euro Coin)
A euro-backed stablecoin issued by Circle, providing a regulated digital euro for cross-border payments and DeFi.
Faster Payments
The UK's real-time payment system processing domestic bank transfers in seconds, available 24/7 since 2008.
FBO Account (For Benefit Of)
A bank account held by a fintech or platform on behalf of its end users, where funds belong to the users, not the company.
FedNow
The Federal Reserve's instant payment service enabling 24/7/365 real-time settlement between US banks and credit unions.
Fedwire
The Federal Reserve's real-time gross settlement system for high-value, time-critical US dollar payments between banks.
Fee Sniping
A theoretical mining attack where miners re-mine recent blocks to capture high-fee transactions, threatening finality.
Fiat-Backed Stablecoin
A stablecoin maintaining its peg through reserves of fiat currency or fiat-equivalent assets held by a centralized custodian.
Finality
The point at which a transaction becomes irreversible and cannot be undone, varying by system design.
Float (Payments)
Money in transit between sender and receiver that hasn't yet settled, representing both a risk and a revenue opportunity.
Force Close
Unilaterally closing a Lightning channel by broadcasting the latest commitment transaction when the counterparty is unresponsive or malicious.
FRAX Stablecoin
A stablecoin that evolved from fractional-algorithmic design to fully collateralized, pioneering the hybrid stability approach.
Front-Running
Exploiting advance knowledge of pending transactions to place profitable trades before them, common in DeFi and DEXs.
FX Spread
The difference between the buy and sell price of a currency pair, representing a hidden cost in cross-border payments.
Hawala
An informal value transfer system based on trust networks, where money is sent without physical movement through local agents.
HD Wallet (Hierarchical Deterministic Wallet)
A wallet that derives all keys from a single master seed, enabling backup with just a seed phrase and organized key hierarchies.
Hodl Invoice
A Lightning invoice where the receiver can delay settlement, enabling escrow-like functionality and conditional payments on the Lightning Network.
Hot Wallet
A cryptocurrency wallet connected to the internet for convenient access and transactions, accepting higher security risk.
HTLC (Hash Time-Locked Contract)
A conditional payment mechanism using hash locks and time locks for trustless atomic transactions across payment channels.
Hybrid Collateral Ratio
A stablecoin design mechanism that dynamically adjusts the mix of asset-backed collateral and algorithmic stabilization to maintain price peg.
IBAN (International Bank Account Number)
The International Bank Account Number is a standardized format for identifying bank accounts across borders in 80+ countries.
Inbound Liquidity
The capacity to receive Lightning payments, determined by how much of a channel's balance sits on the remote side.
Interac e-Transfer
Canada's real-time person-to-person payment system enabling instant bank transfers using email or phone number.
Interchange Fee
The fee paid by the merchant's bank to the cardholder's bank on each card transaction, set by card networks like Visa and Mastercard.
ISO 20022
A global messaging standard for financial transactions enabling richer, structured payment data across banks and payment systems.
Issuer (Issuing Bank)
The bank that issues credit or debit cards to consumers, approving or declining transactions and bearing fraud risk.
Key Management
The practices and systems for generating, storing, using, and backing up cryptographic keys that control digital assets.
Keysend
A Lightning Network payment method that enables spontaneous payments without requiring an invoice from the recipient.
KYC/AML
Know Your Customer and Anti-Money Laundering regulations requiring financial institutions to verify identities and monitor for illicit activity.
Layer 2
A protocol built on top of a base blockchain that processes transactions off-chain while inheriting the security of the underlying layer.
Ledger (Accounting)
A systematic record of financial transactions organized into accounts, forming the foundation of all financial record-keeping.
Lightning Channel
A two-party payment channel funded by an on-chain Bitcoin transaction that enables unlimited off-chain transactions between participants.
Lightning Invoice
A payment request containing the amount, destination, payment hash, and routing hints needed to send a Lightning payment.
Liquidation Cascade
A chain reaction of forced collateral liquidations triggered when market crashes push multiple DeFi vaults below their minimum collateralization thresholds simultaneously.
Loop In/Out
Submarine swap mechanisms for moving funds between on-chain Bitcoin and Lightning Network without custody, enabling non-custodial liquidity management.
LUSD (Liquity USD)
An immutable, governance-free stablecoin backed only by ETH collateral, generated through the Liquity protocol.
Mempool
Each Bitcoin node's waiting area for unconfirmed transactions, where transactions compete for block inclusion based on fee rates.
Merchant Discount Rate (MDR)
The total percentage fee a merchant pays per card transaction, comprising interchange, scheme fees, and acquirer markup.
Merchant of Record (MoR)
The entity that appears on a customer's bank statement and bears responsibility for the transaction, taxes, and disputes.
Merkle Tree
A binary tree of hashes used in Bitcoin blocks to efficiently prove transaction inclusion with minimal data.
MiCA (Markets in Crypto-Assets)
The EU's comprehensive crypto regulation framework covering stablecoins, exchanges, and service providers, effective from 2024.
Miniscript
A structured subset of Bitcoin Script that enables analysis, composition, and generic signing of spending conditions.
Mint/Burn Mechanism
The process of creating new stablecoin tokens when assets are deposited and destroying them upon redemption.
Mobile Money
A phone-based financial service enabling unbanked users to store, send, and receive money without a traditional bank account.
Money Services Business (MSB)
A FinCEN classification for businesses involved in money transmission, currency exchange, check cashing, or stored value.
Money Transfer Operator (MTO)
A non-bank company specializing in cross-border remittances, like Western Union and Wise, often serving unbanked populations.
Money Transmitter License
A state-level US license required to transmit money or provide payment services, with each state having its own requirements.
MPC Wallet
A wallet using multi-party computation to distribute key material across multiple parties, eliminating single points of failure.
MPP (Multipath Payments)
A Lightning payment split across multiple routes that recombines atomically at the destination for improved reliability.
Multi-Path Payments (MPP)
A Lightning feature that splits a single payment across multiple routes to improve success rates and enable larger payments.
Omnibus Wallet
A single blockchain wallet holding funds for multiple users, with individual balances tracked in an off-chain database.
On-Ramp / Off-Ramp
Services converting between fiat currency and cryptocurrency, enabling users to enter and exit the crypto economy.
Onion Routing
A layered encryption technique where each routing node can only decrypt its own instructions, preserving sender and receiver privacy.
OP_CAT (Proposed)
A proposed Bitcoin opcode to concatenate two stack elements, potentially enabling covenants and advanced smart contracts on Bitcoin.
OP_CHECKLOCKTIMEVERIFY (OP_CLTV)
A Bitcoin Script opcode that prevents an output from being spent until a specified block height or timestamp.
OP_CHECKMULTISIG
A legacy Bitcoin Script opcode for m-of-n multisignature verification, replaced by OP_CHECKSIGADD in Tapscript.
OP_CHECKSEQUENCEVERIFY (OP_CSV)
A Bitcoin Script opcode that enforces a relative timelock, requiring a minimum number of blocks since the input was confirmed.
OP_CHECKSIG
The Bitcoin Script opcode that verifies a digital signature against a public key, the most fundamental operation in Bitcoin transactions.
OP_RETURN
A Bitcoin script opcode that marks an output as provably unspendable, commonly used to embed arbitrary data in transactions.
OP_VAULT (Proposed)
A proposed Bitcoin opcode specifically designed to enable vault contracts with secure recovery and withdrawal delay mechanisms.
Open Banking
Regulatory frameworks requiring banks to share customer financial data with authorized third parties via secure APIs.
Open-Loop Payment System
A payment network where cards or credentials are accepted across multiple merchants and institutions, like Visa or Mastercard.
Oracle Manipulation
An attack vector where malicious actors distort price feeds used by smart contracts, often to trigger unjust liquidations or exploit arbitrage in collateralized protocols.
Ordinals
A protocol for inscribing arbitrary data to individual satoshis, creating Bitcoin-native digital artifacts and NFTs.
Overcollateralization
Requiring collateral worth more than the borrowed or minted amount to provide a safety buffer against price volatility.
P2PKH (Pay-to-Public-Key-Hash)
The original Bitcoin address format starting with '1', paying to the hash of a public key for basic single-signature transactions.
P2SH (Pay-to-Script-Hash)
A Bitcoin address format starting with '3' that pays to the hash of a script, enabling multisig and complex spending conditions.
P2TR (Pay-to-Taproot)
The Taproot address format starting with 'bc1p', supporting both key-path and script-path spending with enhanced privacy.
P2WPKH (Pay-to-Witness-Public-Key-Hash)
The native SegWit address format for single-signature transactions, starting with 'bc1q' and offering the lowest fees before Taproot.
P2WSH (Pay-to-Witness-Script-Hash)
The native SegWit address format for script-based transactions like multisig, offering larger script capacity than P2SH.
Passphrase (25th Word)
An optional password added to a seed phrase that derives an entirely different set of keys, enabling plausible deniability.
Payment Channel Network
A mesh of interconnected payment channels enabling multi-hop transactions, with Lightning Network being the largest example.
Payment Facilitator (PayFac)
A company that processes payments on behalf of sub-merchants under its own merchant account, simplifying onboarding.
Payment Finality
The point at which a payment becomes irrevocable and cannot be recalled, varying dramatically across different payment systems.
Payment Gateway
Software that securely transmits payment data from a merchant's checkout to the payment processor for authorization.
Payment Hash
A SHA-256 hash of the preimage that serves as the conditional lock for an HTLC payment in Lightning.
Payment Orchestration
Software that routes transactions across multiple payment providers to optimize authorization rates, costs, and redundancy.
Payment Probe
A technique to discover channel balances and route viability by sending payments designed to fail at the destination.
Payment Processor
A company that handles the technical routing of card transactions between merchants, card networks, and issuing banks.
Payment Rails
The underlying infrastructure and networks that move money between parties, from legacy card networks to modern blockchain systems.
Payment Service Provider (PSP)
A company offering merchants the technology and banking relationships to accept electronic payments across multiple methods.
Payment Settlement Cycle
The time between a payment transaction and when the merchant receives the funds, typically T+1 to T+3 for card payments.
PCI DSS
The Payment Card Industry Data Security Standard, a set of requirements for organizations that handle credit card data.
Peg Mechanism
The system of incentives, arbitrage, and backing that maintains a stablecoin's price at its target value.
PIX Payments
Brazil's instant payment system launched by the central bank, enabling free 24/7 transfers and becoming the country's dominant payment method.
Precision Decay
Cumulative rounding errors in fixed-point arithmetic during multi-hop swaps that can be exploited to drain liquidity pools; a vulnerability class flagged in numerous DeFi security audits.
Preimage
The secret value that, when hashed, produces the payment hash and unlocks an HTLC to claim a Lightning payment.
Probing
A technique used to discover Lightning Network channel balances and network topology by sending fake payments that reveal routing information.
Programmable Money
Digital currency with embedded rules governing how, when, and by whom it can be spent, enabling automated financial logic.
PSBT (Partially Signed Bitcoin Transaction)
A standardized format for constructing and signing Bitcoin transactions across multiple parties or devices.
PTLC (Point Time-Locked Contract)
An improved conditional payment mechanism using Schnorr signatures and adaptor signatures instead of hash locks.
Pull Payment
A payment where the recipient initiates the charge against the payer's account, common in subscriptions and recurring billing.
Push Payment
A payment initiated and authorized by the sender, giving them full control over when and how much to send.
PYUSD (PayPal USD)
PayPal's dollar-backed stablecoin issued by Paxos, available to PayPal and Venmo users for payments and transfers.
Real-Time Payments
Payment systems that transfer and settle funds within seconds, available 24/7, replacing batch-processed legacy rails.
Real-World Assets (RWA)
Traditional financial assets like Treasury bills, bonds, and real estate tokenized on blockchain for DeFi composability.
Rebasing Token
A token that automatically adjusts wallet balances to reflect yield or maintain a peg, changing supply rather than price.
Reconciliation
The process of matching internal records with external payment data to ensure all transactions are accurately accounted for.
Remittance Corridor
A specific geographic route for cross-border money transfers, with costs and speeds varying dramatically by corridor.
Replace-By-Fee (RBF)
A Bitcoin mempool policy allowing unconfirmed transactions to be replaced with higher-fee versions.
Replay Attack
Reusing a valid transaction or signature on a different chain or context where it wasn't intended.
Request to Pay
A payment messaging standard that lets billers send payment requests directly to a payer's bank app for approval.
Reserve Proof
Cryptographic or audit-based evidence that a stablecoin issuer holds sufficient assets to back all outstanding tokens.
Revocation Key
A cryptographic key derived during Lightning Network channel updates that allows a counterparty to claim all channel funds if an old, revoked commitment transaction is broadcast.
Risk Scoring
Assigning a numerical fraud probability to each transaction using machine learning models analyzing hundreds of data signals.
Rollup
A Layer 2 scaling solution that executes transactions off-chain and posts compressed data or proofs to the base layer for security.
Route Hints
Routing information embedded in Lightning invoices that enable payments to nodes with private or unannounced channels.
Routing Attack
Attacks targeting Lightning Network payment routing, including fee manipulation, channel jamming, and balance probing.
Routing Fees
The fees charged by Lightning nodes to forward payments through their channels, consisting of a base fee and a proportional fee.
RTP Network
The Clearing House's Real-Time Payments network, the first US real-time payment system, enabling instant bank-to-bank transfers.
Runes
A UTXO-based fungible token protocol on Bitcoin designed to be more efficient than BRC-20 by using OP_RETURN instead of inscriptions.
Scheme Fee
The fee charged by card networks (Visa, Mastercard) for using their infrastructure, branding, and dispute resolution systems.
Schnorr Signatures
A digital signature scheme enabled by Taproot that offers smaller signatures, native multisig aggregation, and improved privacy.
Seed Phrase
A human-readable list of words (typically 12 or 24) that encodes the master seed for an HD wallet.
SegWit (Segregated Witness)
A Bitcoin protocol upgrade that separates signature data from transaction data, fixing malleability and increasing effective block capacity.
Self-Custody
Holding your own private keys rather than trusting a third party, embracing the principle of not your keys, not your coins.
SEPA Transfer
The Single Euro Payments Area enables euro-denominated bank transfers across 36 European countries with standardized rules.
Settlement
The final, irrevocable transfer of value that completes a transaction, often requiring on-chain confirmation.
Shor's Algorithm Vulnerability
A quantum computing threat to elliptic curve cryptography (ECC) that could theoretically break the digital signatures securing Bitcoin and stablecoin transactions.
Sidechain
A separate blockchain pegged to a parent chain, enabling different features or tradeoffs while maintaining asset transferability.
Sighash Flag
A flag in Bitcoin signatures specifying which parts of the transaction the signature commits to, enabling flexible signing schemes.
Signing Device
A dedicated hardware device that stores private keys and signs transactions, isolating keys from general-purpose computers.
Specified Stablecoins
A regulatory classification in Hong Kong for fiat-referenced stablecoins with official currency ties, subject to mandatory licensing requirements.
SPEI (Sistema de Pagos Electrónicos Interbancarios)
Mexico's electronic interbank payment system providing near-instant peso transfers between bank accounts 24/7.
Splicing
A technique to add or remove funds from a Lightning channel without closing it, maintaining channel uptime and routing capabilities.
Sponsor Bank
A chartered bank that provides regulatory and banking infrastructure for fintech companies to offer financial services.
Stablecoin Arbitrage
Trading strategies that profit from price deviations between a stablecoin's market price and its peg, helping maintain stability.
Stablecoin Blacklist (Freeze Function)
The ability of centralized stablecoin issuers to freeze or blacklist specific addresses, preventing them from transacting.
Stablecoin Payment Rails
Using stablecoins as the settlement layer for payments, enabling instant cross-border transfers at near-zero cost.
Stablecoin Reserves
The assets backing a stablecoin's value, ranging from cash and Treasuries to crypto collateral and real-world assets.
Stablecoin Risk Assessment
A framework for evaluating stablecoin safety based on reserves, governance, legal structure, and redemption mechanics.
Stablecoin Savings Rate
Interest earned by depositing stablecoins into protocol-native savings contracts, like MakerDAO's DSR or sDAI.
Stablecoin Supply and Market Cap
The total outstanding value of stablecoins in circulation, a key indicator of crypto market liquidity and adoption.
Stablecoin Trilemma
The design tradeoff between decentralization, capital efficiency, and price stability that every stablecoin must navigate.
Stablecoin Yield
Returns earned on stablecoin deposits through lending, liquidity provision, or issuer revenue sharing programs.
State Channel
A Layer 2 construct where participants exchange signed state updates off-chain, with on-chain settlement only for disputes.
SWIFT Network
The global messaging network connecting 11,000+ banks to coordinate cross-border payments and financial communications.
Sybil Attack
An attack where a single adversary creates many fake identities to gain disproportionate influence over a network.
Synthetic Asset
A token that tracks the price of an external asset through oracles and collateralization rather than direct backing.
Taproot
A Bitcoin upgrade activating Schnorr signatures, MAST, and Tapscript for improved privacy, efficiency, and smart contract capabilities.
Threshold Signature
A cryptographic scheme where t-of-n parties must cooperate to produce a valid signature, without any party holding the complete key.
Time-Bandit Attack
A theoretical attack where miners with sufficient hashrate reorg past blocks to steal high-value transactions or manipulate history.
Timelock
A Bitcoin script condition that prevents spending until a specified block height or timestamp is reached.
Token Standard
A specification defining how tokens are created, transferred, and managed on a blockchain platform.
Tokenization (Payments)
Replacing sensitive card numbers with non-sensitive tokens to reduce fraud risk and PCI compliance burden.
Trampoline Payments
A Lightning Network routing technique where lightweight clients delegate pathfinding to intermediate nodes, enabling mobile wallets to send payments without maintaining full network state.
Transaction ID (txid)
A unique 256-bit hash identifying a Bitcoin transaction, computed from the serialized transaction data.
Transaction Malleability
The ability to modify a Bitcoin transaction's ID without invalidating it, a critical bug that SegWit fixed to enable Lightning.
Transaction Monitoring
Automated surveillance of financial transactions to detect suspicious patterns indicating money laundering, fraud, or sanctions violations.
Transfer Restriction
Smart contract rules that limit who can send or receive a token, used for compliance in regulated stablecoins and securities.
Trustless
Systems that operate through cryptographic verification rather than relying on trusted third parties.
TUSD (TrueUSD)
A fiat-backed stablecoin with real-time attestations of reserves, which faced controversy over its reserve management practices.
UPI (Unified Payments Interface)
India's real-time mobile payment system processing billions of transactions monthly through interoperable bank-linked apps.
USDB Stablecoin
A Bitcoin-native stablecoin built on Spark that pays yield to holders, issued by Flashnet and backed by dollar-denominated reserves.
USDC (USD Coin)
A regulated dollar-backed stablecoin issued by Circle, fully reserved with cash and US Treasuries, available on multiple blockchains.
USDP (Pax Dollar)
A regulated dollar stablecoin issued by Paxos Trust Company, backed by cash and US Treasuries under New York banking supervision.
USDT (Tether)
The largest stablecoin by market cap, issued by Tether Limited, widely used in trading and emerging market payments.
UST Collapse (Terra/Luna)
The catastrophic failure of Terra's algorithmic stablecoin in May 2022, wiping out $40B+ and triggering industry-wide contagion.
UTXO (Unspent Transaction Output)
The fundamental unit of Bitcoin ownership, representing an unspent output from a previous transaction that can be used as input to a new transaction.
Velocity Check
A fraud detection rule that flags or blocks transactions when a user exceeds a threshold of attempts within a time window.
Virtual Bytes (vBytes)
The weight-adjusted size metric for Bitcoin transactions, determining fees under the SegWit weight system.
Virtual Card
A digitally-generated payment card number used for online or in-app transactions without requiring a physical plastic card.
Watchtower
An outsourced monitoring service that watches for channel breaches on the Lightning Network and broadcasts penalty transactions to protect users who are offline.
Wire Transfer
An electronic funds transfer between banks that settles individually and typically same-day, used for large or urgent payments.
Witness Data
The segregated signature and script data in SegWit transactions, stored separately from the main transaction structure.
Wrapped Asset
A token on one blockchain that represents an asset from another chain, typically held by a custodian or smart contract.