# Glossary

**Centralized Exchange (CEX)** - A form of a cryptocurrency exchange in which a middleman conducts and monitors transactions as well as oversees assets.

**DeFi Pulse Index (DPI)** - A digital asset index that tracks the performance of tokens in the Decentralized Finance industry.

**Decentralized Autonomous Organization (DAO)** - An organization governed by its members and not affected by a central authority, with regulations written as smart contracts on the blockchain.

**Decentralized Exchange (DEX)** - A form of cryptocurrency exchange that lets users perform safe online peer-to-peer cryptocurrency transactions without the use of a middleman.

**Decentralized Finance (DeFi)** - A type of finance that uses smart contracts on blockchains, most commonly Ethereum, to offer traditional financial instruments.

**Dividend** - An amount of money given to the company's shareholders on a recurring basis from its earnings.

**ERC20** - The Ethereum blockchain's standard protocol for writing and issuing smart contracts. Most tokens that operate on the ETH network are ERC20.

**Exchange-Traded Fund (ETF)** - An asset that monitors a sector, another asset, commodity, or index and may be bought and sold on a stock market in the same manner as a conventional stock can.

**Governance** - The structure that regulates and administers an organization, as well as the procedures that hold it and its members accountable

**Impermanent Loss** - The difference in yield generated between the total sum of return from staking a pair of coins in a Yield Fund vs just holding the individual assets in spot.

**Machine Learning** - The application and creation of digital systems that can learn and evolve by analyzing and making inferences from data patterns utilizing algorithms and statistical models.

**Pre-Sale** - An auction held in advance of a general public sale, which is for a small group of buyers.

**Private Sale** - Instead of selling assets on the open market, assets are sold to a small group of strategic investors.

**Rug Pull** - A style of fraud in which developers leave a project and steal the money from its investors.

**SW Improvement Proposal (SWIP)** - Describes the SW DAO platform's standard for an improvement proposal, including core protocol specifications, client APIs, and contract specifications.

**Self-Custody** - When you have ownership over the private key of your wallet, only you have access to your digital assets.

**Simple Moving Average (SMA)** - The average price of an asset over a given time frame.

**Staking** - A method of pledging your crypto assets to a blockchain network.

**Tokenomics** - The study of a crypto token's economics

**Traditional Finance (TradFi)** - Finance that relies on central financial intermediaries such as brokerages, exchanges, or banks.

**Treasury** - A corporation's or institution's assets, typically from revenue, that are reserved or saved.

**Vesting** - A schedule that specifies when a party can wholly own the asset to which they are entitled.

**Yield Fund** - Yield farming is the lending or staking of a cryptocurrency or pair of cryptocurrencies in exchange for interest (yield). Users loan their capital by placing it into a pool and are rewarded with interest payments.