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Glossary

tip

Much of your understanding of the NFT world depends on the clarity of specific terms. Reduce the friction and jump into the following list of terms & definitions!

A​

Airdrop​

An airdrop is a distribution of cryptocurrency, tokens or NFTs that are sent to a web3 wallet address for free as a promotion, or as added value for participating in an experience or purchasing a digital asset. Airdrops are generally used to add additional value or to draw attention to a brand or experience.

Alpha​

Valuable or insider information, usually regarding the value of digital assets like cryptocurrencies and NFTs; a measure of the return on an investment over and above the return offered by the market or other benchmark.

Asset​

In terms of NFT, a Non-Fungible-Token can digitally represent any asset, including online-only assets like digital artwork and real assets such as real estate. Other examples of the assets that NFTs can represent include in-game items like avatars, digital and non-digital collectibles, domain names, and event tickets.

Auction​

An NFT Auction is a type of sale where the seller sets a minimum price and a time period. Interested buyers can submit bids for the NFTs.

B​

Blind Mint​

A type of NFT minting process where you do not know what kind of NFT you are going to receive until the reveal. This type of mint is often combined with web3 RNG mechanisms like Chainlink VRF.

Blockchain​

A system in which a record of transactions made in bitcoin or another cryptocurrency are maintained across several computers that are linked in a peer-to-peer network.

Bridge​

A protocol allowing separate blockchains to interact with one another, enabling the transfer of data, tokens and other information between systems.

C​

Cold Wallet​

An offline device used to store cryptocurrencies and NFTs. Cold wallets can be hardware devices or simply sheets of paper containing a user’s private keys. Because cold wallets are not connected to the internet, they are generally a safer method of storing cryptocurrencies.

Collection​

A collection represents a group of NFTs. Every collection, has a (usually) finite number of NFTs to be minted and once minted users can second-hand sell them on any marketplace that has the collection registered. Simply put, you can think of a collection as a 1-1 match with an ERC721 contract.

Contract​

Smart contracts are simply programs stored on a blockchain that run when predetermined conditions are met. They typically are used to automate the execution of an agreement so that all participants can be immediately certain of the outcome, without any intermediary's involvement or time loss.

D​

DAO​

Decentralized Autonomous Organization, an organization based on open-source code and governed by its users. DAOs typically focus on a specific project or mission and trade the traditional hierarchical systems of legacy corporations for guidelines written on the blockchain.

Degen​

Initially short for degenerate gambler. While this still refers to individuals involved with risky bets, degen may also refer more broadly to anyone involved in crypto and financial spaces. Like with ape, this is generally a self-assigned term and does not carry a negative connotation. Degens are proud people who enjoy ridiculous call options on GME, buying the dip before paying their rent and occasionally aping into shitcoins. “Which one of you degens just bought $50K of XRP at its ATH?!”

Diamond Hands​

A term implying that you are extremely bullish on a certain asset, and have no plans to sell regardless of market volatility, FUD or extreme drops in price. Someone who holds onto a cryptocurrency or stock as it drops 40% in a day is said to have diamond hands.

Drop​

A business term to describe a public, private sale or an airdrop (please refer to the airdrop definition for more details on airdrops). The term aims to describe a business/brand offering certain or all users the ability to buy NFTs or be rewarded NFTs because they meet certain criteria.

Drop Mechanics​

  • Normal is when you know exactly what you are buying, you get what you see.
  • Lootbox is when you get random items, but you don’t know what exactly or even when (late reveal)

E​

ERC-721​

The ERC-721 (Ethereum Request for Comments 721), proposed by William Entriken, Dieter Shirley, Jacob Evans & Nastassia Sachs in January 2018, is a Non-Fungible Token Standard that implements an API for tokens within Smart Contracts.

ERC-1155​

The ERC-1155 is a standard interface for contracts that manage multiple token types. A single deployed contract may include any combination of fungible tokens, non-fungible tokens or other configurations (e.g., semi-fungible tokens).

Events​

Solidity events give an abstraction on top of the EVM’s logging functionality. Applications can subscribe and listen to these events through the RPC interface of an Ethereum client.

EVM​

The Ethereum Virtual Machine (EVM) is what defines the rules for computing a new valid state from block to block. The EVM is a powerful, sandboxed virtual stack embedded within each full Ethereum node, responsible for executing contract bytecode.

F​

Fractionalize​

The process of locking an NFT into a smart contract, and then dividing it into smaller parts which are issued as fungible tokens. This lowers the price of ownership and allows artwork and other digital assets to be owned by a community.

G​

Gas​

Priced in small fractions of the cryptocurrency ether (ETH), commonly referred to as gwei and sometimes also called nanoeth, the gas is used to allocate resources of the Ethereum virtual machine (EVM) so that decentralized applications such as smart contracts can self-execute in a secured but decentralized fashion.

I​

Immediately Minting or Pre-minting​

The creator would pay the minting costs upfront and the buyer would only pay the value of the NFT without the associated expenses.

L​

Lazy Minting​

Lazy minting is a process that delegates the minting costs to the buyer instead of the creator. Simply put, a creator can lazy mint assets and organise a token sale with dSphere without paying for the minting costs of the NFTs. Buyers will mint them on purchase.

Listing​

Simply put, listings are all the NFTs for sale on the marketplace. When a user controlled wallet places an NFT for sale on our or any marketplace, this is called a listing. A listing is executed by the marketplace when a buyer is found.

M​

Marketplace (private)​

A private NFT marketplace allows users of a certain audience (decided by the client) to browse NFTs of specific collections (decided by the client) currently for sale. Users of the marketplace can also place their NFTs for sale. This marketplace will likely have a custom theme to tailor the client’s needs.

Marketplace (public)​

A public NFT marketplace allows all users to browse NFTs of any collections registered with dSphere currently for sale. Users of the marketplace can also place their NFTs for sale, browse through collections and see artists. This marketplace will have a dSphere theme.

Minting​

Minting an NFT is, is how your digital asset becomes a part of the blockchain to make it purchasable.

Minting limitation​

The amount of NFT to be purchased may be limited in each wallet.

Minting costs​

Is the fee or expenses associated to the process of generating new NFT assets.

N​

NFT​

NFT stands for Non-Fungible-Token. At a basic level, an NFT is a digital asset that links ownership to unique physical or digital items, such as works of art, real estate, music or videos. NFTs can be considered modern-day collectibles.

O​

Operator​

A wallet (EOA) allowed to run privileged operations/functions on a contract level. The control of which function can be run by who is placed on the contract during development. An example scenario of an operator wallet would be dSphere deploying a contract for a client but the client requires the ownership of the contract. In that case, we can create an operator role on the contract and transfer the ownership to the client.

Oracle​

A service supplying smart contracts with data from the outside world. Smart contracts are unable to access data that exists off-chain, so they rely on oracles to retrieve, verify and provide external information.

Ownership (contract)​

Many smart contracts require that they be owned or controlled in some way. For example to withdraw funds or perform administrative actions. It is so common that the contract interface used to handle contract ownership should be standardized to allow compatibility with user interfaces and contracts that manage contracts.

Ownership (NFT)​

An NFT essentially allows its buyer to say that they own the original copy of a digital file, in the same way you might own the original copy of a piece of physical art or the master file of a music recording.

P​

Paper Hands​

A term used to describe someone who sold a cryptocurrency or stock as its price was falling, usually for a loss. Someone with paper hands is said to be weak and unable to stomach market volatility.

Private Sale​

A private sale, as its name suggests, is the sale of coins or tokens to specific early investors. These types of sales are usually unannounced and not revealed to the general public.

Public Sale​

Public sales operate on a first-come-first-served basis. To be the first person to get served, savvy NFT traders will engage in “gas wars”. That involves offering increasingly higher tips to miners in the hope their transactions will be processed faster than other competing minters.

R​

Rug pull​

A scam manoeuvre where a crypto project takes the funds that have been invested into its protocol and runs. An inside job pump-and-dump, if you will. A rug pull can also occur in assets with highly centralized ownership. If someone is able to sell a large portion of the circulating supply at once, this rapidly increases the supply, which can cause the price of the asset to plummet.

S​

Sign​

Signing a transaction means cryptographically hashing a set of data using the user’s private key off-chain. That signature cannot be tampered and anyone can prove that this specific wallet signed the transaction.

Sybil Attack​

A Sybil attack is a kind of security threat on an online system where one person tries to take over the network by creating multiple accounts, nodes or computers. This can be as simple as one person creating multiple social media accounts, but in the world of cryptocurrencies, a more relevant example is where somebody runs multiple nodes on a blockchain network.What problems can Sybil attacks cause? Attackers may be able to out-vote the honest nodes on the network if they create enough fake identities (or Sybil identities). They can then refuse to receive or transmit blocks, effectively blocking other users from a network. In really large-scale Sybil attacks, where the attackers manage to control the majority of the network computing power or hash rate, they can carry out a 51% attack. In such cases, they may change the ordering of transactions, and prevent transactions from being confirmed. They may even reverse transactions that they made while in control, which can lead to double spending. DAOs, which centre around community governance, face the threat of sybil attacks, i.e., users having multiple wallets in order to multiply their voting power.So how do blockchains mitigate Sybil attacks?Many blockchains use different consensus algorithms to help defend against Sybil attacks, such as Proof of Work, Proof of Stake and Delegated Proof of Stake. These consensus algorithms don’t actually prevent Sybil attacks, they just make it very impractical for an attacker to successfully carry out a Sybil attack.

Substrate​

Substrate can be described as a blockchain framework — specifically, a framework for building customized blockchains. These blockchains can be run entirely autonomously, which means they don’t depend on any external technology to run.

W​

Wallet​

A cryptocurrency wallet is a device, physical medium, program or a service which stores the public and/or private keys for cryptocurrency transactions. In addition to this basic function of storing the keys, a cryptocurrency wallet more often also offers the functionality of encrypting and/or signing information. Signing can for example result in executing a smart contract, a cryptocurrency transaction identification or legally signing a document.