What is counterparty risk?

Counter party risk is the risk to you if the other people or entities that are involved in a contract don’t hold up their end of the bargain. In the world of cryptocurrency, counterparty risk does come into play in specific circumstances.

What is the difference between custodial wallets and non-custodial wallets?

There are two types of wallets – custodial wallets and non-custodial wallets. The biggest difference between the two types of wallets is who has access to and control of the cryptographic keys that are used to sign transactions. With non-custodial wallets you own and control access to the cryptographic keys. With custodial wallets, a custodian like an exchange owns and controls access to the cryptographic keys. They have ultimate control over the coins in the wallet, not you.

What is impermanent loss?

Impermanent loss is a risk that is associated with being a liquidity provider to a decentralized exchange. It happens when the price of the tokens change compared to when you deposited them into a liquidity pool on a decentralized exchange. The larger the change is, the bigger the loss. Note that, you don’t actually have … Read more

What is a rug pull?

A rug pull is a type of crypto scam that occurs when a team pumps their projects token before disappearing with the funds. A recent example is the SQUID token, which saw the token reach $2,850 in value at its peak. Once the developers’ rug pulled they prevented traders from selling. The coin crashed by … Read more

What is the time value of money?

Time value of money means that a sum of money is worth more now than the same sum of money in the future. This is because money can grow only through investing. An investment delayed is an opportunity lost. So Time literally is money. To invest now is to delay gratification. Delayed gratification is basically your ability to … Read more

What is a coin mixer?

A coin mixer is a smart contract that people use to make it difficult for 3rd parties to track their financial activities on the blockchain. It helps people defend their rights to financial privacy and does so by allowing them to break the link from a sending address to a receiving address. To use a … Read more

What is a Degen?

Degen is an abbreviation for a ‘Degenerate’ gambler and is often used when talking about people who invest in unaudited projects or does crypto intra-day trading without understanding the risks.