The top 130 validators that participate in consensus and receive rewards.
Additional rewards given to delegators through certain validators, separate from staking rewards. Airdrops come from protocols in the Terra ecosystem to increase visibility. To claim an airdrop, visit the webpage of the protocol giving out the airdrop.
A cryptocurrency that tracks the price of any asset, usually currency. Algorithmic stablecoins maintain their price peg through a set of rules or software instead of an underlying asset.
To profit from price differences across different markets. Arbitrageurs buy coins in one market and sell them on another market for a higher price.
An unchangeable ledger of transactions copied among a network of independent computer systems.
Groups of information stored on a blockchain. Each block contains transactions that are grouped, verified, and signed by validators.
A validator in the active set participating in consensus. Bonded validators earn rewards.
When a user delegates or bonds Lunc to a validator to receive staking rewards. Validators never have ownership of a delegator’s Lunc, even when bonded. Delegating, bonding, and staking generally refer to the same process.
The destruction of coins. The Terra protocol burns Lunc to mint Terra stablecoins and vice versa. Burned coins are destroyed.
A mobile payments app powered by Terra’s blockchain network.
The current version of the Terra mainnet.
The percentage of staking rewards a validator keeps before distributing the rest of the rewards to delegators. Commission is a validator’s income. Validators set their own commission rates.
A special fund designated for funding community projects. Any community member can create a governance proposal to spend the tokens in the community pool. If the proposal passes, the funds are spent as specified in the proposal.
A system used by validators or miners to agree that each block of transactions in a blockchain is correct. The Terra blockchain uses the Tendermint consensus. Validators earn rewards for participating in consensus.
The open-source framework the Terra blockchain is built on.
An application built on a decentralized platform.
Distributed denial of service attack. When an attacker floods a network with traffic or requests in order to disrupt service.
Decentralized finance. A movement away from traditional finance and toward systems that do not require financial intermediaries.
When users or delegators add their Lunc to a validator’s stake in exchange for rewards. Delegated Lunc is bonded to a validator. Validators never have ownership of a delegator’s Lunc. Delegating, bonding, and staking generally refer to the same process.
A user who delegates, bonds, or stakes Lunc to a validator to earn rewards. Delegating, bonding, and staking generally refer to the same process.
A length of time measured in blocks. An epoch for the governance module occurs every 100800 blocks, or roughly every 7.7 days, given a 6.6-second block time. Block times may vary.
Currency issued by a government that is not backed by an underlying asset. USD is the fiat currency of the United States.
A computer connected to the Terra mainnet that is able to validate transactions and interact with the Terra blockchain. All active validators run full nodes.
Governance is the democratic process that allows users and validators to make changes to the Terra protocol. Community members submit, vote, and implement proposals. One staked Lunc is equal to one vote.
A written submission for a change or addition to the Terra protocol. Topics of proposals can vary from community pool spending, software changes, parameter changes, or any change pertaining to the Terra protocol.
Slang in the cryptocurrency community for holding a cryptocurrency rather than selling it. A person who does this is known as a Hodler.
Inter-Blockchain Communication. The technology that enables different blockchains to interact with each other. IBC allows for assets to be traded and transacted across different blockchains.
Validators that are not in the active set. These validators do not participate in consensus and do not earn rewards.
Validators who misbehave are jailed or excluded from the active set for a period amount of time.
The native staking token of the Terra protocol. Lunc supply expands and contracts in order to maintain the prices of Terra stablecoins (this aspect of LUNC has been suspended and supply is currently fixed - post de-peg event). Lunc is also used as a governance token. Delegators can stake Lunc to receive rewards.
A swap in Terra Station that uses the Terra protocol’s market function. Market swaps occur between Terra stablecoin denominations or between Terra and Lunc. Market swaps spend gas and incur either a Tobin tax or a Spread fee.
Examples
The creation of new coins. Minting is the opposite of burning. The Terra protocol burns Lunc to mint Terra stablecoins and vice versa (this aspect of LUNC has been suspended and supply is currently fixed - post de-peg event).
When a vote fails to be included in consensus.
A section of the Terra core that represents a particular function of the Terra protocol.
A software that monitors the real-world price and exchange rates of different assets. Validators submit exchange rates to the protocol and vote on the correct rates. Oracles are used to relay current external exchange rates to the protocol.
A currency rate that directly tracks an asset’s price. The peg for UST is the price of USD. The ideal peg ratio is 1:1.
Groups of tokens. Supply pools represent the total supply of tokens in a market.
Proof of Stake. A style of blockchain where validators are chosen to propose blocks according to the number of coins they hold.
The minimum amount of votes needed to make an election viable. 40% of all staked Lunc must vote to meet quorum. If quorum is not met before the voting period ends, the proposal fails, and the proposer’s deposit is burned.
When a delegator wants to transfer their bonded Lunc to a different validator. Redelegating Lunc is instant and does not require a 21-day unbonding period.
Revenue generated from fees given to validators and disbursed to delegators.
Special Drawing Rights. An international reserve asset and unit of account created by the IMF. SDR value is calculated daily using a basket of the world’s largest economies. The Terra protocol uses TerraSDR or SDT as its base currency for calculations and to set standards.
The value of a coin minus the cost of its production. In order to mint UST, an equal value of Lunc needs to be offered for burning. In the Terra protocol’s seigniorage mechanism, a percentage of offered Lunc can be recaptured as seigniorage revenue by sending it to a specified pool before burning. In previous versions of the Terra protocol, seigniorage was diverted to fund the community and oracle reward pools. Since the Columbus-5 mainnet upgrade, all seigniorage in the Terra protocol is burned.
The amount of Lunc a validator bonds to themselves. Also referred to as self-bond.
Punishment for validators that misbehave. Validators lose part of their stake when they get slashed.
The difference in a coin’s price between the start and end of a transaction.
The amount of Lunc bonded to a validator.
When a user delegates or bonds their Lunc to an active validator to receive rewards. Bonded Lunc adds to a validator’s stake. Validators provide their stakes as collateral to participate in the consensus process. Validators with larger stakes are chosen to participate more often. Validators receive staking rewards for their participation. A validator’s stake can be slashed if the validator misbehaves. Validators never have ownership of a delegator’s Lunc, even when staking.
The consensus procedure used by the Terra protocol. First, a validator proposes a new block. Other validators vote on the block in two rounds. If a block receives a two-thirds majority or greater of yes votes in both rounds, it gets added to the blockchain. Validators get rewarded with the block’s transaction fees. Proposers get rewarded extra. Each validator is chosen to propose based on their weight.
The official source code for the Terra protocol.
The Terra protocol’s blockchain network where all transactions take place.
Crypto assets that track the price of fiat currency enabled by the Terra protocol. Users mint new Terra stablecoins by burning Lunc. Stablecoins are named for their fiat counterparts. For example, the base Terra stablecoin tracks the price of the IMF’s SDR, named TerraSDR, or SDT. Other stablecoin denominations include TerraUSD or UST, and TerraKRW or KRT. All Terra stablecoin denominations exist in the same pool.
Terra’s native wallet and platform for swaps, governance, and staking. In Station, you can send, receive, swap, and stake Terra coins. You can also participate in governance and vote on proposals.
A validator’s public address beginning with terravaloper followed by a string of characters.
A version of the mainnet just for testing. The testnet does not use real coins. You can use the testnet to get familiar with transactions.
A quickly expanding network of decentralized applications built on the Terra protocol.
The leading decentralized and open-source public blockchain protocol for algorithmic stablecoins. Using a combination of open market arbitrage incentives and decentralized oracle voting, the Terra protocol creates stablecoins that consistently track the price of any fiat currency.
A fee added to every swap between Terra stablecoins (spot-trading). The rate varies, depending on the denomination. For example, while the rate for most denominations is .35%, the rate for MNT is 2%
To block a validator from participating in consensus or oracle voting. Tombstoned validators cannot rejoin the active set.
The total amount of Lunc bonded to a delegator, including self-bonded Lunc.
A validator that is not in the active set and does not participate in consensus or receive rewards. Some unbonded validators may be jailed.
A validator transitioning from the active set to the inactive set. An unbonding validator does not participate in consensus or earn rewards. The unbonding process takes 21 days.
Lunc that can be freely traded and is not staked to a validator.
When a delegator decides to undelegate their Lunc from a validator. This process takes 21 days. No rewards accrue during this period. This action cannot be stopped once executed.
Lunc that is transitioning from bonded to unbonded. Lunc that is unbonding cannot be traded freely. The unbonding process takes 21 days. No rewards accrue during this period. This action cannot be stopped once executed.
When a delegator no longer wants to have their Lun bonded to a validator. This process takes 21 days. No rewards accrue during this period. This action cannot be stopped once executed.
The amount of time a validator is active in a given timeframe. Validators with low up time may be slashed.
A Terra blockchain miner responsible for verifying transactions on the blockchain. Validators run programs called full nodes that allow them to participate in consensus, verify blocks, participate in governance, and receive rewards. The top 130 validators with the highest total stake can participate in consensus.
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