Common Terms

A system of common terms used in the crypto asset market and related to decentralized applications (abbreviated as “DApp”) VNST:

Terms	Definitions
Stablecoin	Stablecoins are designed to minimize the impact of price volatility by pegging their value to a more asset such as fiat currency, a commodity (gold, silver, etc.), another cryptoasset, or another stabilization mechanism.
Fiat-backed stablecoin	Stablecoins are backed 1:1 or nearly 1:1 by a real asset such as fiat currency (e.g. USD, EUR, or other national currencies, etc.). Fiat collateral will be held in reserve by the issuing organization, traditional bank accounts or highly liquid assets such as government bonds, accompanied by regular auditing and transparency processes to maintain trust and ensure 1:1 conversion.
Commodity-backed stablecoin	Stablecoins are guaranteed to have value stability by anchoring their value to tangible assets such as Gold and Silver.
Crypto-backed stablecoin	A stablecoin directly utilizes other cryptocurrencies (such as Bitcoin, Ethereum, etc.) as collateral to ensure its value stability This maintains the highest level of decentralization as it is not reliant on traditional banking institutions.
Algorithmic-backed stablecoin	Stablecoins ensure stability not through physical assets, but by employing algorithmic economic models and smart mechanisms to adjust supply expansion or contraction in response to market dynamics. This aims to maintain stability.
KYC	It's the process of identifying users, abbreviated as "Know Your Customer" (KYC) or "Know Your Client" (KYC). Ensures transparency and prevents activities like money laundering or other illicit financial activities to comply with financial regulations and legal requirements.
Smart Contract	A type of programming code that runs on a distributed system (Blockchain). Characteristics: It automatically executes, controls, and records relevant events or actions based on pre-established term
MiCA Market in Crypto -Assets Regulation	It's the cryptocurrency regulation law that has been approved by the European Union and came into effect in July 2023, abbreviated as "Markets in Crypto Assets" (MiCA). It outlines regulations for classifying crypto assets and imposes strict rules on crypto businesses, particularly those dealing with stablecoins.
Mint	In the context of cryptocurrency and Blockchain, "Mint" refers to the process of creating new coins or tokens on the Blockchain network. After Minting, all data on the Blockchain will always exist and cannot be altered on the network, ensuring transparency and public visibility.
Redeem	In the context of cryptocurrency and blockchain, "Redeem" refers to the process of exchanging tokens or types of digital assets with ownership rights to become real assets or cash.
AMM - Automated Market Maker	An automated system that enables users to directly trade with other cryptocurrency assets based on supply and demand ratios, automatically determining the value of assets without the need for intermediary intervention.
VMM - VNST Market Maker	An automatic algorithm inherits the core elements of AMM to determine the exchange rate of the VNST/USDT trading pair.
De-Fi	Abbreviated as "Decentralized Finance" Operates on the Blockchain's Smart Contracts, giving users complete control over their assets (non-custodial) within DeFi applications.