Decode finance jargon with Kite
All 123 terms
Showing 24 of 123
Account abstraction
also called smart accountsWallets that behave like normal apps. Spending limits, someone else covering the network fee, recovery without a phrase. The crypto machinery is still there, it is just no longer your problem.
A neobank app. There is a routing number and a SWIFT message under there somewhere, and you have never had to see one.
In Kite: Why you never buy a separate token to pay a network fee with us. Gas is on us.
An attacker sends you a dust transaction from an address that looks like one you use, hoping you copy it out of your history next time. Always check the whole address, not the first and last four characters.
A fraudulent invoice with the account number changed by two digits. Same trick, older than computers.
AML
also called anti-money launderingThe rules and monitoring that stop financial systems being used to launder criminal money. It is why transfers get reviewed and why some accounts get questions.
Same acronym, same regulations, same teams. Crypto firms inherited the rulebook whole.
AMM
also called automated market makerThe formula that prices a decentralised exchange's pool. No order book and no human quoting, just a curve that moves as the pool's balance changes.
An exchange booth whose rate is set by a published formula rather than by a trader's judgement.
Approval
also called allowance, token approvalPermission you grant a smart contract to spend tokens from your wallet, often with no limit and no expiry. Old approvals from apps you have forgotten are a standing risk worth revoking.
A direct debit mandate with no cap and no end date, signed years ago and never cancelled.
APY
also called annual percentage yieldThe annualised return including compounding. In crypto it is often quoted on rewards paid in a volatile token, so a large number can shrink as you earn it.
The AER on a savings account, except the interest might be paid in something whose price moves.
Authorisation
also called auth, pre-auth, holdThe instant yes or no when you tap. The amount is held rather than taken, which is why a hotel or a petrol station can reserve more than you eventually pay.
Exactly the same mechanic, on exactly the same rails. No money has moved yet.
What you can spend right now. In a stablecoin app this is the tokens sitting in your wallet, shown to you as a dollar figure rather than as a token count.
Your available balance, as opposed to your ledger balance with pending items still hanging off it.
In Kite: Your Kite balance sits in US dollars. Local currency swings do not move it.
A batch of transactions confirmed together and chained to the one before it, which is what makes rewriting history impractical.
A settlement batch, except each batch cryptographically depends on every batch before it.
A public search engine for a blockchain. Look up any address or transaction and see its status, amount and history without an account or a login.
If every bank's core ledger had a public read-only search page. There is no banking equivalent, which is rather the point.
A shared record of transactions that many independent computers keep in step, where entries are appended and never quietly edited. That is the whole invention.
A ledger. The novelty is not the ledger, it is that no single institution owns the copy everyone agrees on.
Bridge
also called cross-chain bridgeInfrastructure that carries a token across from one chain to a different one. Necessary, and historically the most attacked part of crypto, so route size and reputation matter.
Correspondent banking. Moving value between two systems that have no direct relationship, through someone who has one with both.
Bull market
also called bear marketPrices broadly rising, or broadly falling. Worth knowing mostly because crypto commentary assumes you already do.
The card network's undo button. The issuer claws a payment back from the merchant on your behalf, sometimes months later. On-chain payments have no equivalent.
The same word and the same process. It is the main consumer protection cards have that raw blockchain transfers do not.
Assets locked to secure a loan. Crypto lending is usually overcollateralised, meaning you post more than you borrow, because the lender knows nothing about you.
The house behind a mortgage, or the securities behind a margin loan.
A transaction being included in a block and buried under further blocks. More confirmations, more certainty. Most stablecoin transfers are settled enough to act on within a minute.
Clearing versus settlement. The payment shows up, then later it becomes irrevocable.
Consensus
also called proof of work, proof of stake, PoW, PoSHow thousands of independent computers agree on one version of the truth without a referee. Proof of stake, the current standard, gives the vote to those with money at risk.
Interbank clearing, where the arbitration is algorithmic and takes seconds instead of institutional and taking days.
Contactless
also called tap to pay, NFCPaying by holding the card or phone near the terminal instead of inserting it. The chip signs the transaction the same way, just over a radio.
The risk that whoever is holding your money cannot give it back. It does not disappear in crypto, it just moves from a bank to an exchange, an issuer or a protocol.
Exactly the same phrase, and exactly the same idea. It is why deposit insurance was invented.
A wallet where a company holds the keys for you. You log in with an email and password, and the company can help you get back in. It can also freeze you out.
A normal bank account. The bank holds the money and the bank decides.
DAO
also called decentralised autonomous organisationAn organisation run by token holder votes that smart contracts then execute automatically. The decision and its implementation are the same action.
A co-operative or a shareholder vote, if the resolution carried itself out the moment it passed.
Showing 1 to 24 of 123 terms