FAQ

A yield aggregator (or yield farm) is a platform or service that allows users to earn interest on their crypto assets by automatically depositing them to different crypto protocols through different passive investment strategies, like liquidity provision, staking and lending. It allows users to earn a passive income on their crypto holdings and optimize the returns on their crypto assets by moving them to the platforms or protocols with the highest interest rates. Additionally, it can also optimize gas fee spending through different techniques like using flash loans, trading strategies, and more.

Real yield in crypto refers to the actual return that an investor earns on their crypto assets after taking into account all the associated costs and risks, including transaction fees, opportunity costs, and the risk of price volatility.

Additionally, it also refers to protocols that generate real value to their liquidity providers (or users) by paying them in a stablecoin or in a cryptocurrency that hasn't just a speculative value and user interested in.

In contrast, protocols that pay rewards in their own token which causes high inflation of token and can eat all the user's profits or even make them lose money are considered as not real yield protocols.

A protocol in the context of cryptocurrencies refer to a set of smart contracts that work together as one project. For example, decentralized exchanges (DEXs) are primarily protocols that are based on a set of smart contracts that control the buying and selling of digital assets. These protocols are built on blockchain networks like Ethereum, and allow users to trade cryptocurrencies directly with each other without the need for a central intermediary. Other examples of protocols include lending platforms, yield farming platforms, and stablecoin projects, all of which are built on smart contracts that work together to provide specific services or functionalities.

A protocol can also refers to a set of rules and standards that govern the functioning of a blockchain network. A protocol is the foundation upon which a blockchain network is built and it defines the rules for creating and verifying transactions, as well as the mechanism for creating new blocks and maintaining the integrity of the network. Protocols like Bitcoin, Ethereum, and Litecoin, for example, have their own set of rules and standards for creating and verifying transactions, and for maintaining the integrity of their respective networks.

A DEX, or decentralized exchange, is a type of cryptocurrency exchange that operates on a blockchain network. It allows users to trade cryptocurrencies directly with each other without the need for a central intermediary. This is in contrast to centralized exchanges, which are controlled by a single entity and require users to deposit their funds into the exchange's custody.

DEXs use smart contracts to facilitate trades, and often allow for greater transparency and security than centralized exchanges, as the trades are recorded on the blockchain and are not controlled by a single entity. Some popular DEXs include Uniswap, Sushiswap, and Kyber Network. DEXs also provide more privacy than centralized exchanges, as the users don't need to provide personal identification documents to open an account.

A lending protocol in the context of cryptocurrency is a decentralized platform or set of smart contracts that facilitates the lending and borrowing of digital assets. These protocols allow individuals to lend their digital assets to others, who can use them for trading or other purposes, in exchange for interest.

Lending protocols can be built on top of existing blockchain networks like Ethereum, and they use smart contracts to automate the process of lending and borrowing, allowing for greater transparency and security. The smart contracts also enforce the terms of the loan, such as interest rate, loan duration, and collateral requirements.

Lending protocols can have different features and designs, for example, some of them can offer collateralized loans, where the borrower pledges a certain amount of assets as collateral in case they are unable to repay the loan, or uncollateralized loans where the lender takes the risk of the borrower defaulting. Some protocols also offer flash loans, which are short-term loans that last for a single transaction and are usually collateralized.

Liquidity in crypto terms refer to the actual amount of assets, tokens, or cryptocurrencies that are available in the market and can be used for different purposes, such as trading, lending, staking, or providing liquidity to other protocols.

For example, in decentralized exchanges (DEXs), users can provide liquidity to different trading pairs by depositing their assets into liquidity pools. These pools allow traders to buy and sell assets directly from one another, and the liquidity providers are incentivized with fees from the trades. They can also add or remove their liquidity from the pool at any time.

Similarly, in lending and staking protocols, users can provide liquidity by lending or staking their assets to the protocol, in exchange they earn interest or rewards.

Providing liquidity to different protocols can be a way to earn passive income, and can also help to increase the overall liquidity of the crypto market, making it easier for traders to enter and exit positions quickly and support price discovery and reduce volatility.

In addition it also can mean the ability of an asset to be easily bought or sold without significant changes in its price.

A liquidity provider is a person or entity that provides assets, tokens, or cryptocurrencies to a market or a trading platform, in order to increase the liquidity of the market and make it easier for other traders to buy and sell assets.

In the context of decentralized exchanges (DEXs), a liquidity provider is a person or entity who deposits assets into a liquidity pool to facilitate trading. They earn a share of the trading fees generated by the pool.

A liquidity provider can be any individual or entity that holds and is willing to contribute digital assets to a liquidity pool, trading platform or any other financial instrument that require liquidity.

In lending protocols, a liquidity provider can be a person or entity who lend their assets to the protocol, in exchange they earn interest on their assets.

In staking protocols, a liquidity provider can be a person or entity who stake their assets to the protocol, in exchange they earn rewards for the validating transactions and helping to secure the network.

Providing liquidity to different protocols can be a way to earn passive income, and can also help to increase the overall liquidity of the crypto market, making it easier for traders to enter and exit positions quickly and support price discovery and reduce volatility.

Liquidity mining, is a process by which users can earn rewards for providing liquidity to a specific market or trading platform.

In the context of decentralized exchanges (DEXs), liquidity mining refers to the process of depositing assets into a liquidity pool in order to facilitate trading. The liquidity providers earn a share of the trading fees generated by the pool.

In lending protocols, liquidity mining refers to the process of lending assets to the protocol and earning interest on them.

In staking protocols, liquidity mining refers to the process of staking assets to the protocol, and earning rewards for validating transactions and helping to secure the network.

Liquidity mining is an incentivization mechanism to attract users to provide liquidity to the platform, and can also help to increase the overall liquidity of the crypto market, making it easier for traders to enter and exit positions quickly and support price discovery and reduce volatility.

It's important to note that liquidity mining can also be associated with risks, such as the risk of impermanent loss, which is a phenomenon that occurs when the price of an asset that is used to provide liquidity in a pool changes, and the liquidity provider may lose some of their assets' value.

APY stands for Annual Percentage Yield, which is a standard measure of the interest rate earned on an investment over the course of a year. It takes into account the effect of compounding, which is when interest is earned on both the original principal and any accumulated interest.

APY is typically used to express the interest rate earned on deposits, loans, and other investments, and is usually expressed as a percentage. For example, if an investment earns an APY of 5%, it means that an investor will earn 5% interest on their investment over the course of a year.

In the context of cryptocurrency, APY is used to express the interest rate earned on lending or staking crypto assets, and it can also be used to express the returns earned on providing liquidity to different protocols. The APY on lending and staking protocols can vary depending on the specific protocol and can be influenced by market conditions and the perceived risk of the investment.

APY is a way to measure the returns on an investment over a year and it's a useful metric to compare different investment options, as it takes into account the effect of compounding and allows for easy comparison.

Important to mention, APY can be calculated in multiple ways, and different protocols may use different methods to calculate it. It's important to be aware that these methods may not always provide an accurate or fair comparison of the returns earned on different investments.

For example, one protocol may use a simple annual interest rate calculation, while another may use a more complex method that takes into account the effect of compounding over a shorter period of time, like a week. As a result, the APYs may not be directly comparable.

It's also important to mention that some protocols may use different ways to calculate APY to make them more attractive, like using only the recent period of time to calculate the APY while ignoring the historical performance, which can give a distorted view of the expected returns.

It's crucial for users to understand the methods used to calculate APY and to compare them with other protocols and other investment options. It's always recommended to investigate and read the whitepaper or any other available documentation of the protocol to understand the mechanics of the protocol and how it generates the returns.

Cryptocurrency, or crypto for short, refers to digital or virtual currency that utilizes advanced encryption techniques for security and protection. Unlike traditional currencies, crypto is decentralized and operates outside of central banking systems. Bitcoin is the most well-known and widely-used cryptocurrency, but there are many others available, including Ethereum, Ripple, and Litecoin.

Impermanent loss is a phenomenon that can occur when providing liquidity to a decentralized exchange (DEX) by depositing assets into a liquidity pool. It occurs when the price of one of the assets in the pool changes, causing the value of the liquidity provider's position to decrease.

When liquidity is provided to a DEX, the provider must deposit an equal value of two different assets into the pool to create a trading pair. When the price of one of the assets changes, the value of the other asset in the pool must also change to maintain the equal overral value of the pair. If the price of the asset owned by the liquidity provider changes more than the other asset, the provider's position will decrease in value.

Impermanent loss can be caused by volatility in the market, and it can also be caused by changes in the trading volume of the assets in the pool. It's important to note that impermanent loss is a risk associated with providing liquidity, and it can be mitigated by closely monitoring the market and adjusting the assets in the pool as necessary.

It's important for users to understand the potential risk of impermanent loss and to weigh it against the potential rewards when deciding whether to provide liquidity to a DEX. It's also important to consider the potential returns, the trading volume and the volatility of the assets in the pool before providing liquidity.

A wallet is a software program that stores private and public keys and interacts with various blockchains. It allows users to send and receive digital currency and monitor their balance. There are different types of wallets, including hardware, desktop, mobile wallets. It is important to choose a wallet that is secure and supports the assets you want to store.

SecOps is a combination of the words "security" and "operations". It refers to the process of combining security and operations teams to improve the security of an organization.

SecOps practices involve many different aspects of security, including:

• Threat detection and prevention
• Continuous protection
• Incident response
• Vulnerability management
• Compliance
• Risk management
• Security automation and architecture

SSDLC is a combination of the words "secure", "software" and "development life cycle". It is fraemwork that describes the process of developing secure software, where security is incorporated in each stage of development lifecycle. The fraemwork involves applying security best practices alongside functional aspects of development, and securing the development environment.