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Web3 101

NFT Glossary

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A

ADA

ADA(₳) is the native cryptocurrency of the Cardano blockchain platform that was launched in 2017 by Charles Hoskinson, co-founder of the Ethereum network.

Airdrop

A term many Apple iPhone users will be familiar with that allows for the wireless transfer of files via WiFi/Bluetooth, in the NFT space “airdrop” refers to sending of cryptocurrency, tokens, or NFTs for free to different digital wallet addresses of users that support a specific project.

B

Bitcoin

Arguably the most well-known cryptocurrency, Bitcoin is a digital currency that is decentralized. This means that it can be sent from user to user on the peer-to-peer bitcoin network without the need for intermediaries such as a central bank.

Blockchain

A blockchain is a distributed database or digital ledger that stores and maintains a secure and decentralized record of transactions. A blockchain guarantees the security of a record of data and generates trust without the need for a trusted third party.

Burn

“Burning” an undesirable NFT simply means to remove it from circulation by sending it to a black hole address (a digital wallet that is owned by nobody) which destroys the token.

Want to get rid of your hapless NFTs? Visit our NFT recyclingtool and earn $Monet here!

C

Cardano

Cardano is an open-source, public blockchain platform with consensus achieved using proof of stake. It can facilitate peer-to-peer transactions with its internal cryptocurrency, Ada (₳).

Centralized Exchange

If you wish to buy cryptocurrency with fiat money (dollars, euros, pounds), then you’ll need to go through a centralized exchange. Unlike decentralized exchanges, these exchanges are regulated and coordinate cryptocurrency trading on a large scale much like a traditional stock trading platform.

CNFT

An NFT that is minted on the Cardano blockchain.

Cold Wallet

A cold wallet is a physical device that looks like a USB drive that stores your crypto assets like cryptocurrency and NFTs offline, making it safer and more secure than storing on an online hot wallet — just don’t lose it or you can say goodbye to your portfolio.

D

DEX

Decentralized exchanges (DEX) allow for peer-to-peer (P2P) transactions rather than going through a centralized or third-party platform that is run by an intermediate.

Check out some DEXes on Cardano’s blockchain here!

Discord

A group-chatting platform similar to Slack (for all the white-collar workers out there) with channels that the crypto community has adopted for NFT project launches and daily updates on the project.

Doxxed

When an NFT project’s team is “doxxed” it means that their identity is publicly known or verifiable. This is seen by NFT collectors as a good sign that the project’s integrity holds up, that buying into the collection is a sound investment and that the rug won’t be pulled out from under them.

Drop Calendar

Drop calendar sites help artists list their upcoming NFT projects and promote the musing featured ads to build hype and hopefully lead to more sales.

Looking for places to list? Start here!

DYOR

Before investing in any NFT project or cryptocurrency, it is recommended that you always “do your own research” first. It’s tempting to follow what so-called crypto influencers suggest is the next best thing, but the only one managing your money and investments should be you.

F

Floor Price

The floor price is the lowest entry price listed for an NFT project.

FOMO

Fear Of Missing Out. This is an expression that gets many degen NFT traders into trouble. The FOMO-into projects without doing their due diligence.

FUD

Fear. Uncertainty. Doubt. When NFT traders starting 'FUDing' in the discord, they've usually lost faith in the project. Often, even though there is not much to worry about, the project will then fail because FUD is very contagious.

G

Gas Fees

Gas fees are the fees that most NFT marketplaces charge when conducting a sale. The gas fees on the Cardano blockchain are 0.17 ADA, but may fluctuate depending on market supply and demand.

GM

Good Morning. This is how we great each other on crypto Twitter and in Discord. We're so busy researching the next degen project, that we don't have time to type out the full greeting.

H

HODL

Hold On for Dear Life. The volatility of the crypto market has made this one of the most often-used expressions in the space.

Hot Wallet

A hot wallet is a digital currency wallet that can be accessed online using the internet. Like cold wallets, users can store cryptocurrency and NFTs using their digital wallets, but hot wallets are more vulnerable to online attacks and potential loss of funds.

Compare Cardano and other multicurrency wallets here!

I

IPFS

Short for “Interplanetary File System”, IPFS is a peer-to-peer (P2P) storage network that can store files, kind of like Google Drive, but decentralized and more secure. In the NFT space, IPFS uses content-addressing to identify unique files in a global network by linking the NFTs metadata, or description of the art, to the place where the artwork is stored.

K

KYC

KYC or “Know Your Customer” is usually an identifying procedure that places like centralized exchanges require new users to submit their personal information to comply with regulations.

M

Metadata

Much like the caption card that accompanies traditional art pieces, the metadata of an NFT describes the details of the work such as the name of the piece, who the artist is, what number of the collection it is as well as what traits or attributes the artwork contains.

Mint

Similar to the way that metal coins are minted and added into circulation, NFTs are also tokens that get “minted” once they are created.

Check out these minting services to mint your first NFT.

N

NFT

A non-fungible token or “NFT” is a unique and non-interchangeable unit of data that is stored on a digital ledger or blockchain. NFTs come in the forms of digital files such as photos, videos, and music or audio tracks.

Thanks to the transparency of the underlying technology used to store NFTs, NFT owners are able to prove ownership of their assets with a policy ID, even if others try to copy and replicate the original work.

Want to learn everything there is to launching your own NFT collection on Cardano?

Check out our NFTs explained guide!

NGMI

Not Gonna Make It. When NFT traders are convinced another trader isn't gungho enough about a certain project, they'll try to make them feel guilty or encourage them by wielding this expression. The opposite is WAGMI.

P

Policy ID

The policy ID is the unique identifier that links a collection of art to the artist, proving ownership of the artwork, and is usually made publicly available for buyers to verify a project’s authenticity so anyone can differentiate replicate NFTs from the original work.

Project

An NFT project is a collection of art that is minted on the blockchain to ensure the uniqueness and ownership of the artwork which is then listed and sold on marketplaces.

Many NFT projects go beyond simply creating digital art and use the created assets in games for users to showcase or use in virtual reality, or to provide real-world utility by offering NFT owners discounts for merchandise or access to exclusive parties or events.

Proof of Stake

Proof of Stake (PoS) is a mechanism used to verify crypto transactions on the blockchain and is utilized by Cardano. By holding onto or staking one’s ADA as collateral for a certain period of time in a stakepool to help approve transactions, users are rewarded with more ADA.

Like 'mining,' this process also requires some computing power and electricity usage, but it is deemed more eco-friendly, faster, and safer than Proof of Work verification.

Proof of Work

Proof of Work (PoW) is a mechanism used to verify crypto transactions on the blockchain and is utilized by Bitcoin and Ethereum. 'Miners' use computing software to solve complex problems to regulate the creation of new blocks on the blockchain and are rewarded with tokens for doing so.

This process requires a huge amount of energy and only increases as more miners join the network.

R

Rarities

Rarities refer to the scarcity of specific traits or attributes of digital artwork, collectibles and in-game NFTs. Rarity can also refer to a limited edition or supply of a specific collection, making the asset more sought after and valuable.

Take a closer look at what constitutes “rarity” of some of the most well-known projects on Cardano with our Rarity Dawg collection here.

Recycling

Here we list out the rating system used for compensating recycled NFTs:

0 - STGNOC: These include fakes, copies and mass produced NFTs. Any collection with more than around 20,000 items is likely to be in this category.
1 - SPAFN: NFTs with pretty-much zero artistic merit as well as airdrops from worthless projects.
5 - VABSAF: These are not complete eyesores, but there is nothing special about them.
10 - ACTTHR: Every so often, great NFTs end up in the recycling depot. These are them.

Royalties

Royalties refer to the money an NFT creator can earn through the resale of the artwork. When the collection and policy ID are created, a royalty percentage can be set so that the original artist can receive consistent commissions when they list their work across different marketplaces.

Rugpull

When a team behind a seemingly legitimate project absconds with all the money raised immediately after an NFT collection launch, this is known as a 'rugpull.'

Investors may still receive an NFT, but it is likely that the asset will be worthless as there will be no future development of the project. Are you a victim of a rugpull?

Come and offload your worthless NFTs at our recycling center and earn $Monet!

S

Secondary Market

Once an NFT is minted, it can be sold or purchased on a secondary market.

Explore some of Cardano’s secondary markets here.

Staking

Staking refers to the process of locking up tokens in a wallet and staking or delegating those tokens to a stake pool for a certain amount of time. This is used in Proof of Stake blockchains like Cardano where users stake their ADA to verify transactions and get rewarded every 5 days or per Epoch.

The more tokens one stakes to a pool, the more rewards one is eligible to claim as it is based on a pro-rata share of the entire amount of tokens staked.

Interested in staking ADA to receive $Monet and other special benefits? Check out The Art Bank!

Seed Phrase

A seed phrase is a list of 12 phrases that are unique to one’s digital hot wallet and is used as a backup to restore or open the wallet on a new mobile phone or computer.

For safety reasons, it’s highly recommended to write this phrase down and store it in a safe place offline as opposed to something like a password manager on your device. This will help to ensure no one can get access to your wallet and assets by potentially hacking your computer.

Stable Coin

A stable coin is a cryptocurrency that is pegged 1:1 to a fiat currency like the US dollar.

Investors use these coins to lock in profits from trading other cryptocurrencies that are more volatile, and even lend out their stable coins to exchanges as interest rates are often significantly more than what one can earn in a traditional savings account with a bank.

T

TLDR

Too Long, Didn't Read. Most of us have short attention spans in this info-overload era. We don't have time to read lengthy reports or research papers on a particular crypto or NFT project. Especially when they just slow us down from minting more NFTs!

Traits

The traits or attributes of an NFT are the unique properties of that NFT in its greater collection. These may come in the form of different backgrounds, colors, or items included in each NFT which also makes certain pieces in the collection rarer.

Take a closer look at traits in action with our Rarity Dawg collection here.

W

WAGMI

When NFT traders are convinced that a project has what it takes to make them rich, WAGMI becomes the oft repeated expression on crypto Twitter and Discord.

Whitelist (WL Spots)

A whitelist is a special list that gives early adopters or followers of an anticipated NFT project the first opportunity to buy into the project. The artist can decide what benefits are attached to gaining a WL spot such as getting the NFT at a discounted price, a higher chance of getting a rare NFT in the collection, and more.