仮想通貨に関する用語集(CRYPTO GLOSSARY) M行

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MACD

MACD (Moving Average Convergence Divergence) is an indicator that shows the relationship between two moving averages of an asset’s price.

What Is MACD?

The Moving Average Convergence Divergence, commonly referred to as MACD, is a widely used tool in technical analysis. Traders use this indicator to identify the strength, direction, and momentum of a price trend for a specific cryptocurrency.

By visualizing how different moving averages interact, the MACD helps market participants spot potential buy or sell signals.

Because it relies on historical price data, it is considered a lagging indicator, meaning it confirms trends that have already begun rather than predicting them with absolute certainty.

How Does MACD Work?

The MACD indicator consists of three main components that are typically displayed together on a price chart:

・The MACD Line: This is calculated by subtracting the 26-period Exponential Moving Average (EMA) from the 12-period EMA. This line represents the momentum of the price movement.

・The Signal Line: This is a 9-period EMA of the MACD line itself. It is plotted on top of the MACD line to act as a trigger for buy and sell signals.

・The Histogram: This bar graph represents the distance between the MACD line and the Signal line. When the MACD line is above the Signal line, the histogram is positive. When it is below, the histogram is negative.

Traders primarily look for crossovers between these lines. A bullish signal occurs when the MACD line crosses above the Signal line, suggesting that momentum is shifting upward.

A bearish signal occurs when the MACD line crosses below the Signal line, indicating that downward pressure is increasing.

Why MACD Matters

MACD is essential for understanding market momentum and identifying potential reversals. Beyond simple crossovers, traders look for divergence.

This occurs when the price of a cryptocurrency makes a new high, but the MACD fails to do so. Such a discrepancy suggests that the current trend is losing strength and may be about to reverse.

By providing a clear visual representation of momentum, the MACD provides an objective framework for assessing whether a trend is accelerating or slowing down.

While no single indicator provides a complete picture, combining MACD with other tools like support levels and resistance levels creates a more robust foundation for navigating market volatility with clarity.

Mainnet

What is Mainnet in Crypto?

It is a blockchain network that is fully operational and deployed by its developers. Bitcoin and Ethereum are both Mainnets.

The term is used in contrast to a “Testnet”, which is a blockchain project that is still in progress and is not yet ready to be deployed.

Testnets are often used to troubleshoot and test all the features of the MainNet network.

The Difference Between a Testnet and Mainnet

While a Mainnet is a live blockchain network, a Testnet is an identical network that runs parallel to it. Similar to a dev site for traditional websites, it is a mock system where developers can experiment with new ideas, gather feedback, and check the efficacy of a system before its launch.

A Testnet also allows developers to test updates and codes, build applications, and detect errors or bugs before implementing changes on the Mainnet. Since Testnets are not live, there is no risk of causing major disruptions on the network.

Testnets and Mainnets are complementary systems that allow for smooth transitions for blockchain networks.

For example, the different elements of the Ethereum merge operated on a Testnet before being implemented on the Mainnet. The network transitioned from the Proof-of-Work (PoW) consensus mechanism to a Proof-of-Stake (PoS) consensus, and developers conducted three testnet rehearsals before the final merge occurred on the Ethereum.

Developers use the testnet in the early stages of a project to detect errors before they are implemented on a fully functional mainnet.

Man-in-the-Middle (MITM) Attack

What Is a Man-in-the-Middle (MITM) Attack?

In general cybersecurity, a Man-in-the-Middle (MITM) attack is a form of digital eavesdropping. The attacker positions themselves between a sender and a receiver to intercept and potentially alter messages. While both parties believe they are communicating directly, the attacker controls the entire flow of information.

In the context of blockchain and crypto assets, an MITM attack targets the communication between your interface (such as a smartphone, browser, or laptop) and the wallet service, decentralized application (dApp), or blockchain node you are using. Attackers aim to intercept sensitive data such as login credentials, seed phrases entered, or transaction details. If successful, they can manipulate a transaction before it is broadcast, which can permanently redirect your digital assets to an attacker’s address.

How Does a Man-in-the-Middle Attack Work?

Common examples of MITM attacks in crypto include DNS Spoofing, where an attacker redirects your browser from a legitimate DeFi platform or exchange to a fraudulent lookalike. You may think you are interacting with a trusted site, but the attacker is capturing your approval to drain your funds.

Malicious browser extensions are another common vector. These compromised tools can monitor your web traffic and silently swap your intended destination address for an attacker’s address when you initiate a transaction. Similarly, rogue Wi-Fi hotspots allow attackers to monitor or tamper with unencrypted data you send, potentially exposing recovery phrases or passwords if you type them into insecure websites or apps on unsecured networks.

How Ledger Prevents Man-in-the-Middle Attacks

The primary danger of an MITM attack is the blind signing of transactions. Because an attacker can alter what you see on your computer or phone screen, you might unknowingly approve a transaction that actually sends your assets to a thief. Ledger reduces this risk by keeping your private keys inside a Secure Element chip, so they never leave the device and remain safe from online threats.

Central to this defense is the Secure Screen, which serves as your ultimate source of truth. Unlike a computer or smartphone display that malware can manipulate, the Secure Screen is controlled directly by the Secure Element in your Ledger signer (hardware wallet). As long as you carefully check the details there, the transaction data you confirm on the device is the actual data you are about to sign, even if a compromised interface shows something different.

What’s more, Ledger’s Clear Signing lets you verify the destination address and transaction amount on your physical device before approving your digital signature. If the data on your Secure Screen does not match what you intend to do, you can immediately reject the transaction.

Margin

What Is Margin in Crypto Trading?

Margin is the collateral you put up to access margin trading (also called leveraged trading). Rather than paying the full value of a position, you deposit a fraction of it as security, and the platform lends you the rest.

This allows you to open a position larger than your available capital, amplifying both potential gains and potential losses.

For example, opening a ＄10,000 position with 10x leverage requires ＄1,000 in margin. That ＄1,000 is your skin in the game. If the trade moves against you far enough, your margin is consumed, and the position is liquidated.

Initial Margin Vs. Maintenance Margin

Two margin thresholds matter to leveraged traders.

Initial margin is the minimum deposit required to open a position, while the maintenance margin is the minimum balance required to keep it open.

If your position moves against you and your account balance falls below the maintenance margin threshold, you will receive a margin call, a warning to deposit additional funds or reduce your position.

If you do not add collateral in time, the position can be liquidated to cover the loss.

How Does Margin Work in Crypto?

Crypto platforms typically offer two margin modes. Cross margin uses your entire account balance as collateral across all open positions.

A loss in one position draws from the same pool supporting others, which can increase the risk of broader account losses. Isolated margin caps the collateral assigned to a single position at a fixed amount, limiting losses from that trade to the margin allocated to it.

Leverage magnifies exposure in both directions. In crypto markets, where prices can move sharply within minutes, under-margined positions can be liquidated before a trader has time to respond.

Margin Vs. Spot Trading

While margin trading uses collateral to increase exposure, spot trading means buying an asset outright with funds you own.

Spot holders do not face liquidation risk from leverage, while margin traders do, making risk management and position sizing critical.

Margin Call

A margin call is a request to add funds or reduce a leveraged position after the value of the collateral falls below a certain level.

What Is a Margin Call?

A margin call is a formal request from a broker or lender for a borrower to restore an account to the required maintenance level. This can be done by depositing cash, posting additional collateral, or reducing the size of the leveraged position. If the borrower does not meet the requirement, the lender may liquidate part or all of the collateral, sometimes with prior warning and sometimes without it.

The term comes from traditional securities markets, where traders using borrowed money had to keep their accounts above a minimum maintenance threshold. When the account fell below that threshold, the broker issued a call to fix the shortfall.

How Do Margin Calls Work in Crypto?

Crypto lending platforms use a similar framework, usually based on a loan-to-value ratio (LTV), which is the loan amount divided by the value of the collateral. A borrower who deposits ＄10,000 worth of bitcoin to secure a ＄5,000 loan starts at 50% LTV. If bitcoin’s price falls, the LTV rises, and the borrower’s safety buffer shrinks.

Many platforms set a margin call threshold below a separate liquidation threshold. When the LTV reaches the margin call level, the borrower may receive a warning to add collateral or reduce the loan. If the borrower does not act and the LTV reaches the liquidation threshold, the platform may liquidate part of the collateral according to its rules.

The exact process varies by platform: some centralized services give borrowers a response window, while others liquidate automatically and quickly. Decentralized protocols typically enforce liquidation through smart contracts, which reduces human discretion but introduces risks such as oracle failures or contract bugs.

Margin Calls and Custody Risk

A margin call means collateral is already exposed to the lender’s risk controls.

On a centralized platform, the platform controls liquidation.

On a decentralized protocol, the smart contract does. Regardless of the platform, once assets are posted as collateral, they are no longer under direct self-custody in the ordinary sense.

Margin Trading

Margin trading is the practice of trading with borrowed money to improve one’s trading position.

What is Margin Trading in Crypto?

Also called leverage trading, margin trading is a risky crypto trading strategy where a trader uses borrowed money, or leverage, from a crypto exchange or broker to increase their purchasing power. It gives the trader control over a larger position than their trading account balance can allow.

To utilize margin trading, traders need to establish a margin account that allows them to borrow funds from a third party. In return, traders provide collateral for the loan, which is typically a percentage of the loan amount. The amount of crypto you need to enter a leveraged position is called a margin (initial margin).

The position size a trader can open is determined by the loan amount and the leverage ratio, which is a multiplier representing the amount they can borrow compared to their capital. It ranges between 1x and 100x.

The trader can borrow a crypto asset at the current market price, sell it immediately, and then repurchase it when the price drops to repay the loan (short it). The trader then pockets the profit from the difference. Alternatively, they can borrow the asset at the current market price and anticipate selling it when its value goes up (open a long position).

Here’s an example:

Suppose you have an account balance of ＄200. Assuming you have 10x leverage, you can borrow crypto assets worth 10 times your account balance to open a position size worth ＄2000. The loan amount would be ＄2000 (position size) – ＄200 (initial investment) = ＄1800.

Scenario 1, the price goes up by 10%. Your initial investment of ＄200 (your capital) would result in a profit of ＄200. In scenario 2, the value drops by 10%. In this case, you lose your initial investment of ＄200, leading to liquidation, where the exchange automatically closes your trade to recover the borrowed fund.

Risks of Margin Trading

Volatility Risk: The crypto market is unpredictable and prices can move in either direction without warning. Hence, margin traders are more exposed to losses than in traditional markets. Leverage amplifies a trader’s profits in case the crypto value rises, but also magnifies the losses if the price dips.

Liquidation Risk: Liquidation occurs when the trader fails to meet the minimum margin requirements. Margin trading increases the potential for forced liquidation if a trader’s position moves against them.

 

Market Capitalization

Market capitalization is a measure of the total value of a cryptocurrency. It is calculated by multiplying the current market price of a coin by its available supply.

What is Market Capitalization in Crypto?

Market capitalization, also referred to as market cap or Mcap, is a metric used to calculate a cryptocurrency’s value and market size. It is calculated by multiplying the total number of coins or tokens in circulation by the current market price of each individual coin or token.

The market cap indicates the dominance, popularity, and value of a cryptocurrency. Cryptocurrencies with larger market caps are usually more popular and dominant in the market, such as Bitcoin and Ethereum.

Why is Market Cap Important?

Market capitalization is used by investors to gauge and track the value of a cryptocurrency. The market cap, along with other metrics like market trends and market sentiments, is a common measurement that traders use to consider which cryptocurrencies are worth investing in. Other key indices like market volume and liquidity are also essential in determining the performance of a cryptocurrency.

Cryptocurrencies are categorized into large-cap, mid-cap, and small-cap groups based on their market cap size. Large-caps are cryptocurrencies that are in the top 10 by market cap. They are well-established, with market capitalizations of ＄10 billion or more. They are comparatively less volatile and have more liquidity as compared to other groups. Examples include Bitcoin and Ethereum.

Mid-cap cryptocurrencies are assets in the top 10-50 cryptocurrencies by market cap. They have MCap between ＄1 billion and ＄10 billion. They have more growth prospects than large-caps, but also experience more volatility and risk. Litecoin and Algorand are both mid-cap.

Small-cap cryptocurrencies are those with relatively small market capitalizations, typically below ＄1 billion. These are usually less established cryptocurrencies that may not have the same level of adoption or recognition as large-cap cryptocurrencies. They may have more potential for growth than large-cap cryptocurrencies, but they also carry a higher level of risk due to their lack of stability and track record.

The market cap of a cryptocurrency determines its stability and growth potential. Investors can use the market cap to determine whether to invest in a coin for stability or potential.

How to Calculate Crypto Market Cap

To calculate the market cap of a coin, multiply the number of circulating coins by its market price.

・Token A has a circulating supply of 10,000,000 and a market price of ＄3.00

・10,000,000 × 3 = 30,000,000

・Ergo, the market cap is ＄30,000,000

Market Depth

Market depth is a visualization of how many buy and sell orders are currently available for a specific cryptocurrency at different price levels.

What Does Market Depth Mean in Crypto?

In the cryptocurrency context, market depth is a real-time representation or reflection of the volume of buy and sell orders of a specific digital asset at varying price points. Simply, it shows the total number of orders waiting to be executed.

Also known as the depth of market (DOM), market depth measures how much the crypto market can withstand relatively large transactions without suffering significant price changes. This is because large trades in markets with little depth can cause slippage for traders. A deeper market typically means that the asset prices remain relatively stable even when large trades occur.

That said, DOM comprises three main components – buy orders, sell orders, and bid-ask spread.

Buy orders (bids) – Contain the buyer information, including the offers to buy the cryptocurrency assets at a specific price, indicating the buying interest of traders.

Sell orders (asks) – Contain the seller information, including the offers to sell cryptocurrency assets at a specific price, indicating the level of selling pressure.

Bid-ask spread – Bid-ask spread indicates the price difference between the highest bid price and the lowest ask price.

This information is often illustrated in a depth chart – a visual representation of an order book. The depth chart helps traders gauge the market’s overall liquidity and current supply and demand dynamics, as well as predict potential price movements.

What Factors Influence Market Depth?

Several factors affect how a market responds to large transactions. Some of these factors include:

Liquidity – The more buyers and sellers in the market, the more liquid the market is, resulting in a deeper market. In contrast, illiquid markets with few participants may experience significant price swings from large orders.

Bid-ask spread – A minimal price difference between the highest bid and the lowest bid often symbolizes high trading activity and greater market stability. Therefore, a wide bid-ask spread indicates a shallow market while a narrow spread signifies a deeper market.

Order size and distribution – A market with many small orders, as opposed to a few large orders, signifies a deep market. This is because there is consistent trading activity and price stability.
Market maker activity – Market makers are responsible for providing liquidity by participating in both buying and selling of assets. They ensure bids and asks are continuously available, typically deepening the market.

Regulatory environment – A favorable regulatory environment incentivizes investor participation and trust, thereby helping deepen the market.

Trading pairs – Generally popular trading pairs exhibit deeper markets compared to less common trading pairs.

Maximal Extractable Value (MEV)

Maximal extractable value (MEV) is the maximum value block producers (miners or validators) can obtain by including, reordering, or excluding transactions when producing a new block.

What Is Maximal Extractable Value (MEV)?

Originally called miner extractable value, maximal extractable value (MEV) is a strategy block producers (validators or miners) use to optimize their profitability by deliberately including, omitting, or changing the order of transactions during the block creation process.

It is sometimes called the “invisible tax” as it extracts extra value from a block on top of block rewards and transaction fees.

Other independent network participants, known as searchers, also profit from MEV opportunities through arbitrage, front-running, or liquidation. Generally, both smart contract-enabled proof-of-stake (PoS) networks and proof-of-work (PoS) systems facilitate MEV.

How Does MEV Work?

When a user submits a transaction, the transaction goes to the mempool of every node in the network. The block producers can decide to include, exclude, or reorder the transactions within the next block. By design, validators and miners tend to prioritize transactions with the highest transaction fees as this is more profitable.

Block producers can extract MEV from organizing the transactions within a block regardless of fees. For instance, ordering transactions in a certain way can result in on-chain liquidation or arbitrage opportunities, resulting in extra profit besides transaction fees and block rewards.

As such, searchers using complex algorithms to spot profitable opportunities can outbid normal transactions by paying higher fees to be prioritized. This ensures that their profitable arbitrage transactions and strategies are executed before similar trades.

Types of MEV

MEV profits are mostly captured through arbitrage and are considered good MEV. Other types of MEV include:

Front-running – A front-run trade entails block producers and searchers inserting a buy order before a similar order is executed. They benefit from the impact the other trade has on the price.

Back-running – A back-run trade occurs when a target trade is immediately succeeded by that of an MEV actor. The MEV actor benefits by capturing a large portion of liquidity in a DEX and selling the asset at a higher price.

Sandwich attack – A sandwich attack entails organizing transactions to execute a buy order before and a sell order after a target transaction. The network participant gains from the slippage of the original trade.

Liquidation – DeFi protocols depend on MEV to liquidate the positions of borrowers when their collateral goes below the set threshold. Since the liquidation needs a faster response, MEV actors pay higher fees for priority. A portion of the fees goes to the MEV actor who facilitated the liquidation.

Pros and cons of MEV

The benefits of MEV are:

Rapid liquidation by MEV actors ensures DEXs remain solvent.
The competition among block producers to validate transactions enhances network security.

The drawbacks of MEV include:

High slippage created by MEV sandwich attackers worsens end-user experience.

MEV exceeding the block reward may lead to consensus instability, where the block producers are incentivized to reorder previous blocks to extract MEV.

Meme Stocks

Meme stocks are shares that experience sudden, extreme price swings driven by viral social media attention rather than company fundamentals.

What Are Meme Stocks?

A meme stock is a publicly traded share that gains rapid, outsized attention through social media platforms, particularly Reddit, X, and YouTube.

Price movement is powered by retail investors coordinating online rather than by any change in the underlying company’s revenues or growth prospects. Many early examples were recognisable consumer brands which institutional investors had bet against via short positions. That said, not all meme-driven surges are preceded by heavy shorting.

How Did Meme Stocks Begin?

The term traces back to a viral surge in GameStop (GME) in early 2021, when retail investors in the Reddit community r/wallstreetbets noticed that hedge funds had taken large short positions against the struggling games retailer.

Coordinated buying drove the share price from roughly $5 in early January 2021 to an intraday peak near $483 on Jan 28 (the all-time high close was about $86.88 on Jan 27). The resulting short squeeze forced institutional short sellers to buy back shares at inflated prices, amplifying the surge. The moment was later portrayed in the 2023 film, ‘Dumb Money’.

The Risks

Much like meme coins, meme stocks are defined by volatility in both directions. As prices reflect social momentum, not business performance, they can collapse just as fast once attention moves on. FOMO drives the loudest buying near the peak, meaning late participants absorb most of the downside. In addition, short squeezes are mechanical, not permanent. This means once short sellers have covered, the forced buying pressure disappears.

MemeFi

MemeFi is a social game that combines the aspects of blockchain gaming and the meme culture.

What Is MemeFi?

MemeFi is a decentralized game that fuses meme culture, social interaction, and blockchain gaming economics. It uses tap-to-earn (T2E) – a simple click-based model that allows users to earn rewards for tapping on their screen – to create an opportunity for players to battle, loot, and earn.

Simply, MemeFi is a browser- and Telegram-based game that allows gamers to interact with humorous memes, compete and earn tokens, and collect in-game NFT assets. This game rewards users for participating or completing quests and leveling up. The players use their accumulated in-game assets to increase their winning chances, upgrade their characters, or enhance their clans.

How Does MemeFi Work?

Like most games, you earn in-game currency by defeating the boss, which, in this case, entails tapping on the boss to drain their health. In addition, you can spend the currency to boost your energy cap (which determines the amount you can tap in a single sitting) or damage done per tap.

The gameplay revolves around gamers picking a side, known as a clan – where they select their favorite memecoins – and raids or clashes. Each of the participating clans represents memecoins, such as Dogecoin and Shiba Inu. The clan members work together to battle members of another clan, loot the in-game currency, and improve rankings on the leaderboard.

The battles typically range from individual raids to clan raids. Individual or boss raids are player-versus-environment (PvE) events where a single player battles a new boss daily. On the other hand, clan raids are player-versus-player (PvP) events – where the entire clan directly competes with another participating clan within a certain period – initiated by clan leaders. As a result, the winning clan claims resources from the losing side.

The game also features a dynamic key system, where each key represents social capital in the game. Your character keys allow you to benefit from the success of others – that is, you earn a share of other players’ rewards. What’s more, the keys are tradable and their values appreciate based on demand and liquidity pool mechanisms.

In short, the clan system allows players to collaborate in raids and missions under their desired memecoin banner. In addition, clan members share resources and payouts based on their contributions. Therefore, the more you play, the greater the potential rewards. Besides clashes, users can interact in private chats and clan chats to formulate strategies, form alliances, and even forge friendships.

Mempool

A mempool is a node’s mechanism for tracking all the unconfirmed transactions.

What is a Mempool?

Every time a new transaction is made on a blockchain network, the transaction is not immediately added to the blockchain. The new transactions are first collected and stored in a temporary storage space called “mempool”.

A mempool, or memory pool, is the waiting room for all unconfirmed/pending transactions. It’s like an organized waiting list for storing and sorting blocks before they are added to the blockchain.

Every individual node within the blockchain maintains its own mempool that acts as a repository for the series of transactions that it has checked and validated. This means that a blockchain has as many mempools as there are nodes. In simpler terms, a mempool stores unconfirmed transactions as individual transactions.

How Do Crypto Transactions Get Added to the Blockchain?

It’s the job of validators/miners to add new blocks of transactions to the blockchain through “consensus”. Hence, the transaction remains in a node’s mempool until a miner adds it to the blockchain. The node performs initial transaction validation checks, which involve ensuring that the number of outputs matches the inputs, the transaction is not a double spend, and the digital signatures are valid. The participating nodes update their copies of the transaction and propagate them to their peers across the network.

The transaction is rejected if the validation checks fail. Otherwise, it is added to the mempool of the node as it awaits for a miner/validator to include it in the next block. In the case of proof-of-work blockchains, miners compete to solve a complex mathematical puzzle, where the miner that finds a solution first gets to add a new block to the blockchain. Once a block is added to the blockchain, the transactions in that block are deemed “confirmed” and removed from the mempool.

Can Pending Crypto Transactions Be Rejected?

As a rule of thumb, if a transaction occupies the mempool long enough, around 48 hours, the transaction is dropped and the funds returned to the user’s wallet. This may happen when the individual pays a low transaction fee during periods of high transaction volumes. This is because miners typically prioritize transactions that offer competitive gas fees since they incentivize them to include those transactions in the next block.

Mempool Space

A mempool space is a software application that queries the Bitcoin blockchain and displays essential information about the current state of the mempool.

What Is Mempool Space: Bitcoin Block Explorer?

Mempool.space is a software application or website used to explore or visualize data about the Bitcoin ecosystem. This data includes unconfirmed Bitcoin transactions, address history, transaction status, and transaction fee rate estimates. Ideally, it denotes both a mempool explorer and a Bitcoin block explorer.

A mempool or “memory pool” typically refers to the temporary storage space or waiting area for all pending or unconfirmed transactions.

Thus, as a mempool explorer, mempool.space showcases a mempool’s current state and its unconfirmed transactions. And, as a Bitcoin block (blockchain) explorer, mempool.space allows users to query the Bitcoin blockchain or browse through Bitcoin transactions.

Technically speaking, the mempool explorer displays the estimated fee rates necessary for achieving specific confirmation times. Additionally, the explorer provides users with the estimated time of arrival (ETA) on pending transactions. It also shows the total data size as well as the mempool’s Bitcoin volume.

How To Use Mempool.space

As a block explorer and mempool explorer, the website encompasses statistics such as confirmed and unconfirmed blocks, transaction fees, difficulty adjustment, recent replacements, and latest transactions (unconfirmed).

These statistics help users customize their fee rates to incentivize miners to include their transactions in the next block. It also allows them to view the status of their transactions after submitting them.

For instance, the dynamics of the unconfirmed blocks, such as block confirmation times and fee rates, allow users to determine when to submit new transactions. This is because miners often reprioritize transactions over others based on the fees they stand to gain. In some cases, they consider the transaction’s size and age.

The explorer also displays the upcoming transactions – an influx of unconfirmed transactions entering the mempool. This data enables users to determine the fee rate that would get their transactions processed in the next block ahead of the existing ones.

In addition, before submitting a transaction, you can use the explorer to view the transactions being dropped from the mempool based on “Memory Usage” and “Purging” metrics. For context, the mempool purges uncompetitive transactions to free up block space when the mempool storage is full.

Moreover, users can utilize the website’s search feature to find a specific address, transaction, or block in the Bitcoin ecosystem.

Merkle Tree

A Merkle tree is a way of organizing data to make it more secure and efficient to process.

What is a Merkle Tree?

A Merkle tree, also known as a Hash tree, is a tree-like data structure named after Ralph Merkle, the computer scientist who introduced the concept in 1987. It organizes large sets of data efficiently by condensing the entire dataset into a single root hash or Merkle root.

In the context of blockchain and cryptocurrency, Merkle trees ensure the integrity of information or transaction data within a block. They also provide a way of organizing transaction data that minimizes the consumption of computational resources such as processing power and storage spaces.

How Do Merkle Trees Work?

Think of a Merkle tree like a family tree for computer files. Imagine you have a folder with four files: A, B, C, and D. To create a Merkle tree, you first create a unique code for each file. Then you combine the codes in pairs and create new codes until you have one code at the top—the “parent code.” It’s like mixing pairs of siblings’ photos, then photos of pairs, until you have just one photo of the whole family.

Now, if the integrity of file B is in question, a user needs B’s code and the parent code for verification. If anyone tries to modify even a tiny bit in B, its code would change, which would affect the codes above. This way, the tree makes sure that no file can be changed without getting noticed.

The parent code in Merkle trees is known as the Merkle root (root hash), despite being at the top of the structure. The unique codes are the hashes of the transactions or data blocks. The hashes at the base of the tree are the leaves (leaf nodes or transaction IDs) while the hashes in the middle are called branches or non-leaf nodes.

The Merkle root is created by combining the hashes of individual transactions into a single hash from the bottom upwards. The root hash is then stored in the block header and used as the base for verifying whether it’s valid to include a particular block in the blockchain.

Technically, Merkle trees break down large data sets into smaller chunks. This allows nodes to verify a specific transaction without having to download the entire block or store a copy of it. It also reduces the blockchain’s size and improves its efficiency.

Metadata

Metadata is a basic summary about a larger set of data. Metadata helps users understand the nature and context of a larger set of data.

What Is Metadata?

Metadata is essentially a data that describes another data. Think of it as the synopsis of a book. Just like the book synopsis gives a brief overview of the story and what to expect, metadata provides information about a particular piece of data.

For example, if you take a photograph with a digital camera, the metadata associated with that photograph might include information about the camera used, the date and time the photo was taken, the location where the photo was taken, and other details. This can be helpful in organizing and searching for specific files, and can also provide context and additional information about the file itself.

It provides the details and characteristics of an NFT for users to read and understand. It provides important information about the NFT and the artwork it represents, such as who created it, when it was created, description, name, etc. This helps users to understand its traits, history, and value.

An NFT’s metadata is usually formatted in a JavaScript Object Notation (JSON), and typically includes a link to view the NFT as a Jpeg, MP4 or audio file.

Where can I find NFT’s Metadata?

It can be found using the blockchain’s explorer.

For NFTs that use the ERC-721 and ERC-1155 token standards, users can also employ Etherscan to verify the authenticity of the NFT, transaction history, and its metadata.

Metaverse

A metaverse is a digital or virtual realm containing all the aspects of the real world.

What is a Crypto Metaverse?

A metaverse is simply a copy of the real world, in its digital form. It is an immersive, shared, and interactive virtual space that allows users to experience life in ways possible and not possible in the physical world. For instance, you can attend your favorite musician’s concert in Las Vegas while sipping a margarita from the comfort of your couch somewhere in Africa.

Metaverses built on blockchain technology facilitate the functioning of digital economies powered by cryptocurrencies and non-fungible tokens (NFTs). It integrates online games, decentralized economic systems, and virtual world elements to create a seamless and open ecosystem. Users can socialize, work, create, build, explore, trade, own property, etc., similar to the real world.

What can you do in the virtual environment?

Socialize, work, create/build, explore, trade, own property, you name it.

What are the Core Attributes of Crypto Metaverses?

The metaverse has been referred to as a 3D internet or the internet of experience – a manifestation of reality grounded in a digital realm. Some core attributes include:

Synchronicity and liveness: A metaverse should be available to everyone and function in real-time, i.e., it is a mimic of real life in real-time.

Persistence: It is indefinite and continuous, never stopping, skipping forward, ending, or resetting. It just keeps going.

A fully functioning economy: It should allow businesses and individuals to create, own, and trade in assets that have real-world economic value.

Enhanced interoperability: A metaverse should allow users to traverse between different areas and experiences seamlessly, without hurdles of varying currencies or consistency.

Contribution-oriented: It features a wide array of content and experiences, produced and controlled by different contributors. The contributors can be individuals, businesses, organizations, or corporations.

Inclusiveness: Anyone can partake in everything a metaverse has to offer, allowing them to take part in any activity, event or place.

MiCA Legislation

The EU’s MiCA legislation establishes a legal framework for the digital asset market and its service providers.

What Is MiCA Legislation?

The Markets in Crypto-Assets (MiCA) legislation represents the European Union’s first unified regulatory framework for cryptocurrencies. It is intended to create a consistent set of rules for the crypto industry with the stated goals of enhancing investor protection, ensuring market integrity, and supporting financial stability.

Before MiCA, the crypto industry in Europe operated under a patchwork of national laws, which created regulatory uncertainty. MiCA aimed to establish a single set of rules, allowing Crypto-Asset Service Providers (CASPs) like exchanges, custodians, and trading platforms to operate across all EU member states with a single authorization.

How Does MiCA Legislation Work?

MiCA establishes rules for the issuance, offering, and trading of crypto-assets. Its approach is built on several key pillars:

Categorization of Crypto-Assets

MiCA classifies digital assets into three categories: e-money tokens (which reference a single official currency), asset-referenced tokens (which reference any other value or combination of assets), and a third catch-all category of all other crypto-assets, which includes utility tokens as well as assets like Bitcoin and Ether. Each category is subject to specific requirements.

Authorization for Service Providers

CASPs must obtain authorization from a national authority in an EU member state. Once approved, they can “passport” their services across the entire EU.

Mandatory White Papers

Issuers of new crypto-assets must publish a detailed white paper containing transparent information about the project, its technology, and its risks to allow for informed investor decisions.

Strict Rules for Stablecoins

MiCA places stringent requirements on issuers of asset-referenced tokens and e-money tokens, a category that includes most stablecoins. These include rules on maintaining adequate reserves, governance, and redemption rights.

Market Abuse Provisions

The framework introduces rules to combat market manipulation and insider trading, aligning crypto markets more closely with traditional financial markets.

The framework now applies in full. July 1, 2026, marks the end of MiCA’s transitional period, after which crypto-asset service providers must hold full MiCA authorization to serve EU clients, with no further grandfathering under national regimes.

Industry Perspectives on MiCA

The crypto industry’s reaction to MiCA has been mixed, with stakeholders highlighting both significant benefits and considerable challenges.

Some in the crypto industry have welcomed the regulatory clarity that MiCA aims to provide. Proponents argue that a harmonized framework reduces legal complexity and lowers barriers to entry for companies wanting to operate across Europe.

Conversely, other industry participants have raised concerns about the potential negative impacts of the regulation. Specifically, that strict regulation could interfere with innovation, making it more difficult and expensive for smaller companies to operate and thus leading to market consolidation by larger and better-funded non-European companies.

Miner

A miner is a participant in a cryptocurrency network responsible for generating new coins and verifying transactions.

What is Crypto Miner?

In traditional banking systems, government authorities and financial institutions are responsible for the printing and distribution of fiat currency to the public. In cryptocurrencies, new tokens are minted and introduced into the system through mining and this is where a miner comes in.

Mining is the process of competing to solve complex mathematical puzzles to generate new coins and secure the blockchain for a block reward. A crypto miner is a cryptocurrency network user who is responsible for gathering and verifying transactions, creating new blocks, and recording them on the blockchain. Miners are also responsible for adding new coins into the ecosystem and maintaining network integrity.

To verify transactions and add new blocks to the blockchain, miners use computing power to solve complex mathematical puzzles. Once a minor successfully creates new blocks, they earn a certain amount of that cryptocurrency, which is called a mining reward or block reward.

What do Miners Use to Mine Cryptocurrency?

To mine cryptocurrencies, you need a cryptocurrency wallet and mining software. Mining also requires specialized hardware to solve complex mathematical puzzles, such as a computer’s CPU (central processing unit), GPU (graphics processing unit) and ASIC (application-specific integrated circuit) machines. However, the CPU mining option is less popular since CPUs overheat and lack the speed and power to handle processes in the competitive crypto mining operations.

Mining some cryptocurrencies requires specialized computing units with greater processing power. For instance, Bitcoin mining uses ASIC machines. ASIC is a specialized hardware fashioned for the sole purpose of crypto mining. It can be engineered to minimize energy consumption demands while still maximizing computing power.

Since the chances of solving the mathematical puzzle are slim for an individual miner, some miners choose to join a mining pool. Mining pools entail a collection of miners pooling their computational resources (by building a mining rig) to improve their odds of winning mining rewards. The reward is shared among the miners in the pool based on the amount of work contributed.

How Much Do Crypto Miners Make?

A lot of factors will determine the profitability of crypto mining. For instance, miners contributing more computational power to the network will generally earn more.

This means that individual miners are less likely to receive a block reward as compared to miners in mining pools.

The crypto’s rate of mining rewards and its market price also affect the profitability of mining that crypto. Crypto mining calculators, like WhatToMine, help miners to calculate the profitability of mining a specific cryptocurrency and the ones to avoid.

Miner Capitulation

Miner capitulation is when the cost of mining exceeds the potential rewards, causing miners to reduce their operations or sell reserves.

What Is Miner Capitulation?

Miner capitulation is a market phenomenon that occurs when the individuals and companies that secure a blockchain network, known as miners, face extreme financial stress.

In the competitive world of mining, profit margins are under constant pressure from two factors: the market price of the asset and the network’s hash rate (the total computing power on the network). When the cost of electricity and hardware maintenance exceeds the value of the coins being earned, less efficient or highly leveraged miners are forced to “capitulate.” This results in them turning off their machines and often liquidating their accumulated reserves to cover their debts or operational expenses.

How Does Miner Capitulation Work?

Miner capitulation typically follows a specific cycle of events that impact the entire blockchain ecosystem:

Declining Profitability: A sharp drop in price makes mining less profitable. This can also be seen after a “Halving” event (which cuts miner rewards in half)

Selling Pressure: To stay afloat, miners begin selling coins from their reserves. This increase in sell-side supply can put further downward pressure on the market price.

The Shutdown: Marginal miners with high electricity costs or older hardware can no longer compete. They turn off their rigs, leading to a visible drop in the network’s total hash rate.

Difficulty Adjustment: As miners leave, the network’s protocol automatically adjusts its mining difficulty downward. This makes it easier and cheaper for the remaining, more efficient miners to find blocks, eventually stabilizing the industry.

While miner capitulation sounds bearish because it involves mass selling and a drop in network computing power, some investors view it as a contrarian bullish signal.

For long-term holders, miner capitulation can represent something of a system refresh, leaving behind a more robust and efficient network of miners. Once inefficient miners exit the market, the sell-side pressure from the mining sector drops significantly, potentially paving the way for price recovery.

Miner Fee

A miner fee is the fee that a blockchain charges to process and confirm transactions on the network.

What Is Miner Fee?

When you transfer cryptocurrency to other parties, it takes computational power to execute and validate the transaction on the network. To account for this power consumption, each transaction incurs a small fee that goes to the miner who validated the transaction. This transaction cost is known as the miner or mining fee.

A miner is a contributor to a proof-of-work blockchain responsible for processing transactions, creating new blocks, and including them in the blockchain using specialized hardware. As compensation for their service and computational resources, they are rewarded with miner fees. Miner fees were originally designed to discourage fraudulent activities that may disrupt part of the Bitcoin network’s operations. They also prevent the network from clogging up or overloading as miners compete to process transactions first to receive the fees as part of their reward.

In the Ethereum network, miner fees are known as “gas fees”.

What Characterizes Miner Fees?

In most blockchains, miner fees are constantly fluctuating. The blockchain’s state at the time of a transaction will determine the exact amount a user will pay for their transaction to be processed. Hence, if the network is congested, users will pay higher fees than usual. In addition, the amount varies based on the network due to their distinct ways of calculating miner fees. For instance, transferring tokens like TRON and EOS attracts negligible miner fees.

The amount of miner fees determines the priority of a transaction. A transaction that pays a sufficient amount of miner fees will be confirmed in a shorter period than one that pays less. Transactions with lower or no miner fees may take days to be validated. In some instances, they may be rejected and the funds get credited to the user’s wallet.

Mining

Mining is the process of confirming and validating transactions and adding them to a proof-of-work blockchain.

What is Crypto Mining?

Traditional financial systems introduce new fiat currency units by simply printing and issuing more of them to the public. In cryptocurrency networks, there is no centralized entity responsible for the creation and issuance of new coins or confirming transactions. Instead, crypto networks use a process called mining or minting for this purpose.

Crypto mining is the process through which transactions are gathered, verified, and included in a blockchain network. It is also a way of generating and issuing new crypto units. Mining is an energy-intensive process used in proof-of-work (PoW) blockchains like Bitcoin and other altcoins. Its alternative is minting, often associated with proof-of-stake (PoS) and other consensus mechanisms.

The individuals involved in the mining process are known as miners or mining nodes. The miners are tasked with confirming transactions from their mempool and organizing them in a new block. A block reward, made up of transaction fees and block subsidy, is used to incentivize miners for successfully mining a block.

How Does Crypto Mining Work?

Cryptocurrency mining involves miners packaging transactions into batches and competing to solve a complex mathematical puzzle using specialized hardware. The winning miner gets the opportunity to add a new block to the blockchain and receives a block reward in the form of the respective blockchain’s native currency.

To further put this into context, take Bitcoin mining for instance. When a user sends some BTC to a friend, the transaction is assigned an “unconfirmed” status and broadcast across the network. The unconfirmed transaction is then added to a queue (waiting or temporary area) of unconfirmed transactions called mempool or memory pool. Every miner basically has their own mempool.

Miners pick unconfirmed transactions from the waiting area and package them into batches or candidate blocks. An average block on the Bitcoin network fits around 2,000 transactions, which is approximately 2MB. The actual mining process begins after the transactions are packaged into a candidate block. The miners compete to find a valid hash, which has to be less than or equal to a predetermined value (the target value). Finding the valid hash allows the miners to fully verify their candidate blocks, which are then added to the blockchain. The miners then update their mempools to remove the confirmed transactions. The process repeats itself every 10 minutes on the Bitcoin network.

Why is all this laborious process necessary?

Mining secures the crypto networks from spam transactions and attempts to manipulate or take control of the network. Thus, it is a necessary process for maintaining a PoW blockchain’s integrity.

Mining Difficulty

Mining difficulty is a measure of how hard and time-consuming it is to mine a new block in a proof-of-work blockchain.

What Is Mining Difficulty?

In proof-of-work (PoW) blockchains, network participants known as miners validate transactions and successfully include new blocks in the blockchain.

The mining process – which demands significant computational resources – involves several individual miners (or mining pools) competing with each other to solve a complex computational puzzle.

The first one to do so successfully earns rewards in exchange for their computational energy and resources.

. Mining difficulty is the metric for gauging how difficult and time-consuming producing a block is. Typically, the difficulty of mining blocks increases as the number of miners in the network increases, and decreases as the number of miners decreases. For example, Bitcoin’s difficulty level was 1.873 trillion as of December 19, 2012. By February 18, 2024, the difficulty had risen to 81.7 trillion, reflecting the growing number of miners in the network.

Mining Difficulty in Bitcoin

The typical block time – the average time taken to gather and compile individual transactions into blocks – for Bitcoin is approximately 10 minutes. To uphold this consistency and prevent blocks from being produced too quickly or too slowly, Bitcoin mining difficulty undergoes adjustments at fixed intervals.

Specifically, Bitcoin undergoes a crucial adjustment after every 2,016 blocks mined(roughly every two weeks).

This happens because the network changes what is known as the target value. To explain, Bitcoin miners are required to calculate a fixed-length string of text, called a hash, to successfully mine a block.

What’s more, for the hash to be valid, it must be equal to or smaller than the target value. The larger the target value is, the harder it is for miners to find a valid hash.

In other words, the network increases the target value when it needs to slow down the block time, and decreases the target value when it needs to speed up the block time.

Mining Pool

A mining pool is a collection of crypto miners who combine their computing resources to increase their chances of earning a reward.

What is a Mining Pool in Crypto?

In Proof-of-Work blockchains, the more processing power a miner has, the higher their chances of producing a block. This process can prove expensive for solo miners while mining some coins. To improve their chances of finding the next block, individual miners can join forces and combine their computing resources with other miners to form a crypto mining pool. The mining pool shares any rewards earned from successfully mining a block among the miners, based on their contribution to the pool.

How Do Mining Pools Work?

Think of software engineers trying to find a bug in thousands of lines of code. Every engineer has a powerful computer that could eventually identify the bug and fix it. But what if the first engineer to find the bug and fix it earned a monetary reward? This makes it a competitive venture. Instead of working individually, some of the software engineers could form a collective group to pool their resources for the hunt. This would improve their chances of finding the bug first, fixing it, and splitting the reward.

Crypto mining pools work in a similar manner. Instead of competing individually, miners combine their individual computational power to increase their chances of successfully mining blocks. The mining pool has a team leader or coordinator that assigns tasks to ensure the miners don’t waste resources trying to produce the same block. The coordinator is also responsible for sharing the reward based on the miners’ computing power contribution.

Mining pools operate in different ways, some of which include:

Pay-Per-Share (PPS): Miners are paid a fixed amount for each “share” (the number of hashes matching the pool’s specification that have been submitted), regardless of whether the pool successfully mines a block. The pool operator may charge a fee upfront or from the block reward.

Full Pay-Per-Share (FPPS): Like PPS, miners share the reward according to their contribution, but also receive a share of transaction fees. The pool calculates and distributes the average transaction fee based on the submitted shares.

Pay-Per-Last-N-Shares (PPLNS): Miners are rewarded only when the pool successfully mines a block. The pool considers the last N shares and calculates rewards based on shares submitted within that range.
Some benefits of mining pools include:

・Increased chances of consistently earning rewards
・Reduction of variability through reward distribution
・Miners with less powerful hardware can still participate in mining
・Mining pools are more cost-efficient as miners share energy costs

Miniscript

Miniscript is a dynamic and flexible, high-level programming language for expressing Bitcoin Scripts in a structured way.

What Is Miniscript?

Despite its extensive capacity, Bitcoin Script – the native programming language used to create the conditions under which Bitcoin transactions are executed – is limited to simple scripts such as single-signature and basic multi-signature. In addition, Bitcoin Script can be very difficult and time-consuming for programmers.

Miniscript is a high-level programming language for writing Bitcoin Scripts, giving developers a more dynamic and flexible framework. As a result, it simplifies encoding spending conditions and the creation of valid witnesses.

Pieter Wuille, Andrew Poelstra, and Sanket Kanjalkar designed and implemented this high-level language at Blockstream Research. It was aimed to allow users to craft customized, dynamic, and flexible rules and conditions for Bitcoin transactions.

How Does It Work?

Miniscript comprises two main parts – a Policy language and the Miniscript itself. The policies are made up of fragments – the building blocks that can be integrated to forge more sophisticated policies. The resulting policies can then be compiled into Miniscript, which simply translates or compiles the policy language into Bitcoin Script.

Put another way, Miniscript analyzes, composes, and compiles spending policies to represent Bitcoin Script. Its structure facilitates its malleability, security, and correctness, as well as other properties, allowing it to translate into the Script language.

This advanced scripting language streamlines the creation of complex Bitcoin transactions, eliminating the need to write custom scripts from scratch. This includes leveraging the programmability of Script to create intricate multi-sig wallets or enabling time-locked transactions (which only allow users to automatically access their funds after a certain period has elapsed). It can save developers substantial time and effort while minimizing the potential for coding errors.

For example, Ledger uses Miniscript to create time-locked wallets for safety and recovery, allowing users to perform some sort of “trustless assisted custody.” Such miniscript-aware Ledger wallets provide you with another way of accessing funds – but only after a predetermined period – should you lose your primary keys or multi-sig.

What’s more, its simpler syntax and modular design simplify code verification and auditing, thereby mitigating the potential for bugs and coding vulnerabilities. This can help enhance the overall security of Bitcoin transactions. In addition, its flexibility and extensibility enable developers to leverage it to create custom Bitcoin transactions tailored to their specific needs.

Minting

Minting in the context of blockchain refers to the mechanism through which new coins or tokens are produced and introduced into circulation.

What is Minting?

Just as fiat currencies have a minting process, crypto also involves the generation of new coins or tokens. This occurs on the blockchain through computational processes that validate information and result in the creation of new blocks.

In contrast to fiat currencies, where a central reserve manages the minting process for a country, blockchain-based minting is fully decentralized, free from central oversight. The validators on the blockchain carry out the minting process and receive incentives in the form of token rewards.

How Does It Work in Crypto?

Generating new tokens in crypto can happen in one of two ways: minting or mining.

Mining primarily refers to the process of validating and adding transactions to the blockchain, typically in proof-of-work (PoW) consensus algorithms. In PoW blockchains like Bitcoin, miners compete to solve complex mathematical puzzles using computational power. The first miner to solve the puzzle successfully adds a new block of transactions to the blockchain and is rewarded with newly minted coins or tokens.

Minting is commonly associated with proof-of-stake (PoS) and other consensus algorithms. In PoS blockchains, participants who hold a certain amount of existing tokens can validate and mint new tokens based on their stake. Instead of solving computational puzzles, minters are chosen based on their ownership or “stake” in the network.

By pledging these tokens, participants become validators on the blockchain. The role of a validator in a PoS blockchain is to verify and document transactions executed on that network. These validators are then rewarded with newly minted tokens for creating new blocks.

In summary, mining involves validating transactions and adding blocks to the blockchain through computational work, while minting is the process of creating new coins or tokens, often through ownership or participation in a proof-of-stake system.

Minting NFTs

Minting is typically the initial step in the lifecycle of an NFT, where a digital asset is tokenized and represented as a unique token on the blockchain.

When an NFT is minted, a smart contract is used to create a digital certificate of ownership for a specific asset or piece of content, such as digital artwork, collectibles, virtual real estate, or even tweets. The minting process usually involves interacting with a platform or marketplace that supports NFT creation.

During the minting process, certain attributes and metadata can be associated with the NFT, such as the creator’s information, a description of the asset, provenance details, and any additional properties or characteristics that define the uniqueness of the token.

Once the minting process is complete, the NFT is assigned a unique identifier that distinguishes it from all other tokens on the blockchain. This identifier is recorded on the blockchain, ensuring the authenticity, ownership, and scarcity of the digital asset.

 

ML-DSA (Module-Lattice Digital Signature Algorithm)

ML-DSA is a standardized, lattice-based signature scheme designed to provide robust quantum resistance for digital transactions.

What Is ML-DSA?

ML-DSA, formerly known as Dilithium, is one of the primary post-quantum cryptographic (PQC) standards selected by the National Institute of Standards and Technology (NIST). ML-DSA is designed to augment, and potentially eventually replace, some classical digital signature algorithms in systems that adopt post-quantum cryptography.

The development of ML-DSA is a direct response to the threat posed by future quantum computers. While current signature schemes are highly secure against classical computers, they are vulnerable to being broken by a sufficiently powerful quantum computer. ML-DSA uses lattice-based mathematics, a complex geometric framework that, as of now, remains computationally infeasible for both classical and quantum computers to solve.

How Does ML-DSA Work?

ML-DSA operates on the principle of module lattices, which provide a balance between high-level security and computational efficiency. Implementing this standard introduces a significant shift in how digital signatures are handled:

Signature Size: One of the most notable differences between ML-DSA and current standards is the size of the signature data. While a standard Bitcoin ECDSA signature is roughly 64 bytes, an ML-DSA signature is significantly larger, often around 2.4KB.

RAM Requirements: The algorithm requires a substantial amount of memory to process and verify. For hardware signers, this represents a key engineering challenge. Secure chips must be powerful enough to handle these larger datasets and more complex calculations while maintaining the strict isolation required for security.

Lattice Complexity: ML-DSA relies on the difficulty of finding the shortest vector in a high-dimensional lattice. This approach is specifically chosen because, as of now, there are no known efficient quantum algorithms that can solve the underlying lattice problems.

Crypto-Agility and Hardware Readiness

The transition to ML-DSA is where crypto-agility becomes essential. For an ecosystem to survive the quantum age, hardware must be capable of running these new, resource-intensive algorithms alongside existing ones.

Crypto-agile hardware may eventually support ML-DSA, allowing users to interact with assets secured by post-quantum signatures, depending on ecosystem adoption and wallet support. The hardware device acts as the trusted signing layer, using its secure chip to handle these large data packets while its screen provides a clear, human-readable verification experience.

This ensures that, even as the underlying cryptography evolves toward quantum resistance, users can still physically verify what they are authorizing before signing.

Mobile Wallet

A mobile wallet is a built-in feature or software application that can be installed on a smartphone. In crypto, the program stores users’ private keys and allows them to interact with their digital assets.

What is a Mobile Wallet?

A mobile wallet in the crypto context is a mobile-based software application used to store a user’s private keys. These wallets facilitate swapping, sending, and receiving digital assets. They allow you to monitor and control your digital assets as well.

Your cryptocurrencies live on the blockchain, and mobile wallets, like most crypto wallets, are only a conduit through which you can access your funds. This means that they only store your private keys, which prove that you own your digital assets and authorize your transactions.

A crypto mobile wallet is similar to your bank’s mobile app through which you can send and receive funds through the application. They also feature a recovery phrase, which is a collection of randomized text representing all the private keys associated with the wallet, to facilitate asset recovery and password resets.

Are Mobile Wallets Custodial or Non-Custodial?

Mobile wallets can be custodial or non-custodial. Non-custodial mobile wallets imply that the user has complete control over their private keys, giving them the sole responsibility of safeguarding their digital assets. This is opposed to custodial wallets that involve a third party, like a crypto exchange, managing the user’s private keys.

However, since they require an active internet connection, they are regarded as a form of hot storage. This internet also exposes them to vulnerabilities, such as malware attacks, hacking, and malicious programs, that can be used to gain unauthorized access to private keys.

They are generally known for their portability, user-friendliness, easy accessibility, and flexibility. They also facilitate faster transaction processing time.

Modular Blockchain

A modular blockchain is a blockchain that specializes in performing a few responsibilities or functions and delegating the rest to other layers.

What Is a Modular Blockchain?

Monolithic blockchains employ a unified structure model, meaning that all activities and tasks are performed on a single layer. However, as the amount of transactions or activities in the network grows, the cost associated with verification resources proportionally increases.

Instead of trying to do everything on the base layer, modular blockchain follows the principles of separation of concern to scale throughput while maintaining security and decentralization.

A modular chain defines a blockchain network that focuses on a specific function(s). Its essence lies in dividing the blockchain’s core functions into smaller, distinct modules.

This modular approach optimizes resource utilization and reduces network congestion by offloading other tasks to separate chains. It also allows autonomous development, maintenance, and upgrading of individual modules, promoting greater efficiency, scalability, and overall network performance.

Such blockchains can specialize as:

Execution: Blockchains specializing in execution process transactions and state changes. They also facilitate interactions between the blockchain and its users, such as signing transactions, exchanging assets, and creating smart contracts.

Settlement: Settlement-specific blockchains resolve disputes and verify the execution of transactions. The settlement layer is non-existent in monolithic blockchains and optional in a modular stack.

Consensus: The consensus layer is responsible for ordering transactions and transaction finality. It achieves this through the full nodes that confirm the authenticity or validity of a transaction.

Data availability: The data availability layer holds the transactional data necessary to verify state changes. In simpler terms, it ensures that historical data is available whenever needed.

Most popular blockchains were designed to handle all these functions on the base layer, making them monolithic. Modular stacks, on the contrary, distribute the core functions across several specialized chains.

Modular Blockchain Examples

Some common modular chains include Celestia and Polygon Avail, which specialize in data availability and consensus by offloading execution to rollups (modular chains focusing on execution).

Other solutions include StarkEx, zkPorter, Optimism, Arbitrum, and zkSync.

Move-to-Earn

Move-to-Earn is a concept in the Web3 ecosystem through which people are rewarded for physical activities like walking, jogging, and running.

What is Move-to-Earn (M2E)?

Move-to-earn (M2E) refers to a subset of decentralized protocols or applications (dApps) that incentivize exercise using blockchain technology, NFTs, DeFi, and gamification.

M2E platforms generally require users to purchase an ecosystem NFT in order to participate (though some may offer limited functionality for non-NFT holders). Then, the M2E dApp makes use of the sensors in users’ mobile devices to track their physical activities. The specific activities that the dApp registers can vary between applications. The data captured during these activities is then used to issue player rewards. These rewards are usually crypto tokens that can be used to trade or purchase upgrades within the platform, or traded on third-party platforms.

Users’ physical activity earns them crypto rewards. This is what sets this form of earning crypto apart from other ones that rely on on-screen interactions like Play-to-Earn or Learn-to-Earn. Move-to-Earn (or M2E for short), allows people to incentivize their daily physical activities and motivates them to get moving in the age of screens.

How Can You Earn with M2E?

Earning with M2E is pretty straightforward, though the specifics depend on the type of dApp you choose. Some of the common ways to earn crypto via M2E involve:

Exercising: Platforms like STEPN give tokens like GST for the number of steps taken by users, making them engage in regular exercise.
Minting: One can also mint NFTs like virtual sneakers that can be sold and exchanged within the game for any desired coin increase by the game.

Trading: Gaming platforms will allow users to trade in-game items and NFTs via secondary markets such as OpenSea, which unlocks new income sources for players.

Staking: M2E platforms also allow crypto staking, where users can lock their assets for a period of time, and in return, get interest or rewards over time. For example, Step App allows perpetual staking of its FITFI tokens.

Challenges and Competitions: One can even seek fitness challenges and competing with other users which can also give rewards. It gives the whole fitness routines a gaming appeal and therefore making them more exciting.

Overall, Move-to-Earn merges the fields of fitness and finance, using the blockchain to create a new form of motivation and gamification for physical activities, thus encouraging healthier habits.

 

Moving Average

A moving average (MA) is an indicator that smooths out price data by creating a constantly updated average price over a specific period.

What Is a Moving Average?

A moving average (MA) is one of the most widely used tools in technical analysis, designed to filter out the “noise” of random short-term price fluctuations. By calculating an average price over a set timeframe it creates a single, smooth line on a chart, making it easier for traders to identify the underlying trend direction.

Because it is based on past prices, the moving average is considered a lagging indicator. It doesn’t predict future prices but rather confirms the current trend. Its simplicity and effectiveness make it a foundational component of many other technical indicators and trading strategies like Bollinger Bands.

How Does a Moving Average Work?

A moving average is calculated by summing up an asset’s closing prices over a specific number of periods (e.g., 50 days) and then dividing by that number of periods. As each new period closes, the oldest data point is dropped, and the newest one is added, causing the average to “move” over time.

Traders use moving averages in several key ways:

・Trend Identification

If the price is consistently trading above the moving average, it’s generally considered to be in an uptrend. If it’s below the moving average, it’s in a downtrend. The slope of the MA also indicates the trend’s direction and strength.

・Support and Resistance

In an uptrend, a moving average can act as a dynamic support level where prices may bounce. In a downtrend, it can act as resistance.

・Crossover Signals

Traders watch for crossovers between different moving averages. When a shorter-term MA crosses above a longer-term MA, it creates a bullish golden cross. When it crosses below, it forms a bearish death cross.

There are two primary types of moving averages:

・Simple Moving Average (SMA): This is the most basic form, where all prices in the period are weighted equally.

・Exponential Moving Average (EMA): This type gives more weight to the most recent prices, making it react more quickly to new price changes.

While SMAs provide a smoother line and are better for long-term trend identification, EMAs are preferred by traders who want to capture shorter-term moves and receive earlier signals.

 

MPC Wallets

MPC Wallets use Multi-Party Computation to split a private key into multiple “shards” distributed across different parties.

What Is an MPC Wallet?

Multi-Party Computation (MPC) is a cryptographic protocol that allows multiple parties to jointly compute a function while keeping their individual inputs private. In a crypto wallet, MPC replaces a single private key with several independent mathematical secrets, or shards, held by different devices or entities.

When a transaction needs to be authorized, these shards collaborate to generate a valid digital signature without ever combining into a full private key. This architecture is designed to remove the single point of failure associated with traditional key management. If one shard is compromised, the attacker cannot sign a transaction because they lack the other distributed pieces.

How Does an MPC Wallet Work?

The security of an MPC wallet relies on a Threshold Signature Scheme (TSS). When the wallet is created, the involved parties generate their shards locally, and no single party ever sees the others’ data. To sign a transaction, a predefined number of these parties must participate in the computation. For example, in a 2-of-3 setup, at least two shards must be active to authorize a move.

As the final signature looks identical to a standard blockchain signature, MPC is chain-agnostic and works across any network. It also allows for flexible governance, as the underlying shards can be redistributed among new participants without ever changing the wallet’s public address.

MPC vs. Multisig: Understanding the Trade-offs

Both MPC and multisig wallets require multiple approvals to move funds, but they rely on different technical architectures. Choosing between them often depends on a user’s specific requirements for transparency and flexibility.

・Multisig (On-chain Logic): Multisig wallets rely on multiple distinct private keys. The rules of the wallet are written into a smart contract directly on the blockchain. This provides a transparent, immutable audit trail where every signature is recorded publicly. This onchain approach is highly valued for its transparency and decentralization, though it can sometimes result in higher transaction fees and limited cross-chain compatibility.

・MPC (Off-chain Computation): MPC happens entirely off-chain before the transaction is broadcast. It is highly efficient and provides privacy, as the distributed nature of the signature is not visible on the blockchain. It is also compatible with any blockchain as it produces a standard signature. However, because the process occurs off-chain, it lacks the transparency and public auditability inherent to smart-contract-based multisig.

Multichain

A multichain is an application designed to operate across isolated chains, allowing them to communicate with each other.

What is a Multichain?

The advent of blockchain technology has revolutionized the financial landscape and how the everyday user goes about their day. However, a persistent pain point is that blockchains are currently siloed, with each operating independently of the other. When blockchains are siloed, it hinders innovation while preventing users from utilizing their digital assets on other blockchains.

For example, if the digital assets are limited to a single chain, developers and users cannot transfer data and assets to other chains without introducing bridges, which can create security concerns.

Multichain technology is built to address blockchain siloes. A multichain or multichain application is a decentralized application (dApp) deployed on multiple chains. Operating on at least two chains simultaneously, a multichain allows users on different networks to communicate and collaborate. It also facilitates the transfer of digital assets across networks without the use of blockchain bridges.

Multichain can also be defined as a cryptocurrency asset available on different blockchains. For instance, a stablecoin such as Tether (USDT) simultaneously exists on Ethereum, EOS, Solana, Tron, and Liquid Network. This makes it a multichain cryptocurrency asset.

How Multichain Technology Works

Blockchains are inherently disconnected from each other and often operate independently. Since they barely interact with outside networks, accessing applications and digital assets on a different chain poses a challenge.Multichain technology aims to solve this blockchain fragmentation setback by enabling transactions across different chains and smooth data and assets exchange. Besides scalability, this approach also enhances functionality and efficiency in the ecosystem.

To achieve this, multichain technology splits the underlying blockchain infrastructure into different layers: the base layer and the application layer.

Base or consensus layer: The base layer is essential in handling the ecosystem’s overall security.

Application layer: This layer is programmable. It allows individual blockchains to co-exist and communicate with outside networks regardless of their structures. This allows developers to create and launch the same application on different networks, which facilitates interoperability without jeopardizing the ecosystem’s security.

Multichain Vs. Cross Chain

How is multichain different from cross-chain technology?

Cross-chain technology describes technology that allows different blockchains to share and access information and value across completely unrelated networks without intermediaries.

Its main difference between cross-chain and multichain technology is that cross-train technology utilizes smart contracts to create “wrapped” versions of a cryptocurrency. This synthetic version can be directly used in outside networks. On the other hand, multichain technology creates an “internet” of blockchains that can seamlessly interact without compromising security.

 

Multisignature

Multisignature or “multisig” transactions are a type of transaction that requires multiple signatures for a single transaction to be executed.

What is Multisignature in Crypto?

Multisignature requires two or more signatures for a single wallet address to execute transactions. The funds on a multisig address can only be accessed when all signatories approve. The technology has been around for a while, but was popularized by Bitcoin and cryptocurrencies in 2012.

Think of a multisig address like a vault with two locks and two keys.

The first key is held by one person and the second is held by another person, and neither of them can open the vault without the other. The vault can only be opened by both individuals at the same time.

This offers an extra layer of security and removes the risks associated with single key addresses, which can be more prone to security risks like phishing.

How Does a Multisig Transaction Work?

In a multisig transaction, two private keys are used in tandem to initiate and complete a transaction. Both parties have to sign a transaction at the same time before the network approves it.

This distribution of responsibilities increases the security of the multisig address.

Users can choose how many keys are required to access the wallet or address. For example, a 2-of-3 multisig requires two out of three private keys to unlock a multisig address. Bitcoin’s Lightning network requires a 2-of-2 multisig to close a payment channel.

Corporations and businesses favor the multisig transaction system for increased security. It allows businesses to store their assets on a cold wallet, and different members of the team are assigned the private keys. This reduces the risk of one employee unilaterally accessing the assets.

Ledger Enterprise offers a multisig product tailored for this purpose.

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