Hem
Ordlista
Crypto Protocol

Crypto Protocol

Intermediate
A crypto protocol is a set of rules and procedures governing participants’ behavior in a decentralized network that uses cryptography to secure its operations. Crypto protocols are usually open-source and transparent, allowing anyone to examine and verify the underlying code. Designed to be decentralized in nature, they ensure that no single entity or authority controls the network. Instead, participants contribute to its operations by validating transactions and maintaining the network’s consensus.
Protocols are not exclusive to cryptocurrencies; they exist almost everywhere. Take the Internet, for example, where protocols enable websites to function. The most common internet protocols are HTTP and HTTPS. These form the underlying code that allows all Internet applications to run. Google, Facebook, Twitter, and many other websites run on one of these internet protocols.
Crypto protocols are designed to be trustless, meaning participants can transact without needing a trusted intermediary. This is made possible through the use of cryptography to secure transactions and ensure their integrity.
To demonstrate, look at Bitcoin, the most prominent crypto protocol. It allows users to transact money directly, without a third party like a bank. Bitcoin’s consensus algorithm is based on Proof of Work (PoW), which requires participants in the network to solve complex mathematical puzzles to validate transactions and earn new bitcoins as a reward. 
Crypto protocols are fundamental in the emerging field of decentralized finance (DeFi), which aims to create new financial systems and products that operate on decentralized networks to rival traditional finance.
Ordlista

A cryptocurrency or digital cash that is independent of any other platform, which is used as an exchange of...

Ordlista

A bullish chart pattern where a shorter-term moving average crosses above a longer-term moving average.

Ordlista

The maximum amount of funds a project intends to raise during their Initial Coin Offering (ICO) or alternat...

Ordlista

A term referring to traders or investors who lack the confidence to hold their assets or to follow their tr...

Ordlista

The time elapsed when a transaction is submitted to the network and the time it is recorded into a confirme...

Ordlista

Describes how authorities adjusts the tax rates of a country, influencing how public funds should be collec...