Glossary

Airdrop

Distribution of a token or other digital assets to reward a project’s community based on certain eligibility criteria.

API

Application Programming Interface is a publicly available interface that allows developers to access and interact with the functionalities of a particular software or platform.

Auction Round

First round of the funding round on Polimec where professional and institutional participants submit bids in a candle auction. It determines the final token price as the weighted average of the highest bids that meet the target funding and are above the minimum price set by the issuer.

Bonding

Locking up tokens as collateral to participate in consensus protocols, secure the network, and earn rewards.

Bootstrapping

Self-launching a business without or with only minimum external capital.

Bounties

Rewards offered to individuals or groups for completing specific tasks, such as identifying and reporting bugs, improving code, or developing new features for a blockchain project.

Candle Auction

Type of auction where bidders (participants) can place bids during an unknown predefined period of time. The highest bid/bidder at the conclusion of the time period - end defined after auction period ended - is considered the winning bid/winner.

Collators

Node operators in parachain networks that collect and execute transactions, generate state transition proofs, and provide unsealed blocks to validators for proposing a parachain block, while also facilitating message passing between different parachains.

Community Round

Second round of the funding round on Polimec where all participant types participate at the final token price. It concludes when the target funding amount is reached, or after a period of 5 days.

Contribution Tokens

Tokens issued by projects which successfully raised funds on Polimec, serving as proof of participation for participants of the respective funding round.

Credentials

Verifiable, tamper-proof records that attest identity attributes, skills, achievements, and qualifications of individuals.

Cross-Chain Transfers

Process of transferring tokens or value between different blockchains.

Cross-Consensus Message Format (XCM)

Format that enables the exchange of any type of data between blockchains.

CTYPE

Claim types define the structure of a credential.

DIDs

Decentralized identifiers, globally unique persistent identifiers that do not require a centralized registration authority and are often generated and/or registered cryptographically.

DOT

Native token of Polkadot, serves three purposes: bonding, general operation, and governance.

Evaluators

Assess projects that apply for funding on Polimec and earn rewards for successful evaluations or get slashed for unsuccessful ones.

EVM

Ethereum Virtual Machine, a decentralized software used to create decentralized applications and smart contracts.

Forks

Creating a new blockchain protocol by copying an existing one and making changes to its software or logic.

Fully Diluted Supply

Total number of tokens issued by a project, including the supply which is still to be issued or released.

Gavin Wood

Polkadot founder and Ethereum co-founder, well known for his contributions to smart contract technology and blockchain interoperability.

HNWI

High net worth individuals, commonly referred to as HNWIs, are individuals with substantial financial resources and investable assets.

Instance-ID

Unique identifier assigned to each instance on a blockchain network.

Institutional Participants

Legal entities which qualify as professional, such as financial intermediaries or companies with professional treasury departments.

Interoperability

Ability for a system, such as different blockchains, to exchange or to make use of information and data.

Issuers

Projects applying for funding or raising funds using Polimec.

KILT Protocol

A blockchain identity protocol for generating self-sovereign, decentralized identifiers (DIDs) and verifiable credentials.

KSM

Native token of Kusama, serves three purposes: bonding, general operation, and governance.

KYC/AML

Know Your Customer, process of identifying and verifying the client's identity aimed at uncovering or preventing fraud, corruption, money laundering and terrorist financing.

Anti Money Laundering, a framework of laws, regulations, and procedures aimed at uncovering or preventing efforts to disguise illicit funds.

Layer 0

Provide the fundamental infrastructure for layer 1 blockchains and are designed to address the challenges prevalent to blockchain systems, including security, scalability and interoperability.

Layer 1

Base protocol layer of a blockchain network.

Linear Bonding

Gradually locking up tokens in a smart contract over a specified time period.

Liquidity Pool

Pool of tokens locked in a smart contract that facilitates the trading between the tokens on a decentralized exchange.

Liquidity Providers

Earn fees by offering cryptocurrency assets as liquidity in a decentralized trading pair, which are locked with the protocol for a set period of time.

Mainnet

A project’s fully operational blockchain.

Mainnet Tokens

Tokens that operate on a project’s fully operational blockchain (mainnet).

Minimum Price

Minimum price per token set by the issuer during the funding application.

Multichain

System where multiple independent blockchains are linked together to enable cross-chain interoperability and communication between them.

Multipliers

Factor applied by participants in a funding round to determine the participation amount in relation to the required bonded PLMC and respective duration of the vesting period of their PLMC and mainnet tokens.

Network Participants

General term for all network participants interacting on Polimec, i.e. issuers, evaluators, participants, stakers, liquidity providers.

Nodes

Computers or devices that contribute to maintaining the blockchain by validating transactions, storing a copy of the blockchain, and relaying information to other nodes.

Nominated Proof-of-Stake

Proof-of-stake consensus mechanism where nominators (token holders) nominate and back validators with their own stake to secure the network and create new blocks in exchange for rewards.

On-Chain

Activities, transactions, or data that are recorded directly on the blockchain.

On-Chain Treasury

Smart contract that holds a cryptocurrency project's funds and manages the allocation of those funds through community governance.

Parachains

Purpose-built blockchains that connect to the Polkadot Relay Chain to benefit from shared security, cross-chain interoperability and scalability.

Parathread

Allow parachains to temporarily participate (on a block-by-block basis) in Polkadot security without needing to lease a dedicated parachain slot.

Participation Currencies

Cryptocurrencies that are accepted by the issuer for participating in the funding round (e.g. stablecoins, DOT, KSM), specified in the issuer’s funding application.

Participants

Participate in funding rounds on Polimec and are categorized as retail, professional, or institutional participants.

Permissionless System

Blockchain that allows anyone to participate and transact without the need for approval or permission from a centralized authority/actor.

PLMC

Native token for Polimec, serves four purposes: evaluation, participation, staking, and governance.

Polkadot

Heterogeneous, multi-chain network allowing various blockchains of different characteristics to perform arbitrary, cross-chain communication under shared security, enabling cross-chain interoperability and scalability.

Professional Participants

Natural persons with the necessary knowledge or experience and/or sizable assets at their disposal.

Proof-of-Validity (PoV)

Piece of information created by collators that parachain validators use to verify the validity of a new parachain block, without the need to store the entire parachain storage.

Proof-of-Work (PoW)

Consensus mechanism in which nodes solve complex mathematical problems to validate transactions and mine new blocks, requiring significant computational power and energy consumption.

Protocol Inflation

Gradual increase in the supply of a cryptocurrency resulting from the issuance of new tokens according to the protocol's tokenomics, often used to incentivize network maintenance.

Pseudonymous

Practice of using a public key or wallet address where the identity of a person is unknown whereas it is still possible to assign related transactions to the same wallet.

Regulatory Compliance

Adherence to the laws, regulations, and other provisions set forth by governmental authorities or other bodies that apply to a specific activity or process.

Relay Chain

Blockchain that coordinates consensus and communication between parachains and external chains.

Retail Participants

Natural persons that do not qualify as professional participants.

Root Origin

Concept of root account that has ultimate control over a network's parameters that can make systemic changes. On Polimec, the root origin is the highest privileged origin, and its only used for enacting governance proposals.

Rule-Based Framework

Set of predetermined rules that governs the execution of transactions based on the behavior of network participants or specific circumstances on a blockchain.

Runtime Upgrades

Allow changes or improvements made to the underlying software or logic of a blockchain while it is still operational (i.e. without the need for a hard fork).

SDK

Software Development Kit is a set of software building-tools for specific applications such as protocols.

Slashing

Penalty mechanism in blockchains that involves the deduction of a portion of staked tokens for certain types of malicious, erroneous behavior, or i.e. inaccurate funding prediction.

Smart Contract

Self-executing digital program that automatically enforces the terms and conditions implemented in its code, such as a transaction between parties on the blockchain.

Solidity

High-level programming language used for writing smart contracts on the Ethereum blockchain.

Stablecoin

Type of cryptocurrency designed to maintain a stable value, often pegged to a fiat currency or commodity, providing price stability.

Stakers

Delegate to collators who validate transactions and stabilize the network, and in return, earn rewards.

Staking

Holding/locking up tokens to contribute to validating transactions and supporting the functioning of the network, and in return, earning rewards.

State Transition Proof

Mathematical proof that demonstrates the validity of a transition between two states on a blockchain network, ensuring the integrity and correctness of transactions.

Sybil Attack Protection

Strategies and mechanisms designed to safeguard decentralized and distributed systems from security threats posed by malicious users creating multiple fake identities or nodes to manipulate or control the network.

Tokenomics

Parameters that govern the issuance, allocation, distribution, and usage of tokens, considering factors such as supply and demand, market adoption, and network effects.

Trustless

Ability of a system to function without the need for network participants to trust each other or a central authority/actor.

Unbonding

Withdrawing tokens from a staking pool or other activities, which takes a certain amount of time to complete.

Validators

Node operators in a proof-of-stake (PoS) blockchain that validate transactions and proofs from collators on parachains, and create new blocks along with other validators to earn rewards.

Verifiable Random Function (VRF)

Cryptographic tool used to ensure fair and tamper-proof random selection of events.

Vesting

Gradual release of tokens over a specified period of time, often used as a mechanism to incentivize long-term commitment from token holders.

Web3

Third generation of the world wide web, characterized by the use of decentralized technologies such as blockchain, smart contracts, and peer-to-peer networks.