Learn
Crypto Basics
< All Topics
Print

Tokens

Basics

Tokens are created by smart contracts on blockchains.  Tokens come in several flavors, from MemeCoins (tokens with no purpose other than novelty) to currency used to fund projects, to currency meant to use or buy things inside projects or games.

 

Definitions:

Liquidity: The funds held by the token you are trading. Liquidity increases and decreases with each buy and sell of the token.

Liquidity Lock: When liquidity is locked, the contract owner does not have access to pull the pooled trading funds, until the end of the lock period. If liquidity is unlocked, investors typically consider the project unsafe, as all funds can be taken from the project at anytime.

Presale: A sale that occurs prior to the project being activated on an exchange platform.

Renounced: The ownership of the contract in question is no longer held by the contract creator. Functions of the code which can be utilized to “scam” investors, cannot be accessed when a contract is renounced.

Rug Pull: There are various styles of rug pulls. A rug pull is where the developer of a project, intentionally removes value from the liquidity pool and leaves investors with a small fraction of their investment, or nothing.

Shill: The individual (or group) act of promoting a project, or investment, by advertising/marketing, usually through group/social media, in order to grow one’s investment.

Slow Rug: When a developer funds themselves with tokens of the project, for no cost. As liquidity is added through transactions occurring, the developer will sell off these tokens, to take project funds from investors.

Whitelist:  A specific list of wallets that can perform a function for a token – often meant to track wallets that can purchase tokens in a presale.

Next Projects
Table of Contents