Glossary: Your guide to all things Web3 and the Metaverse

We know that the Metaverse and Web3 can be full of new and confusing terms.

In order to fully understand the concepts surrounding the Metaverse and Web3, it is essential to have a comprehensive understanding of the terminology used within these fields.

We’ve put together this handy guide to provide clear and concise definitions. 

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Avatar:

A digital representation of a user in the Metaverse, often used to interact with other users and virtual objects.

Augmented Reality (AR):

A technology that overlays digital information on the real world, enhancing their perception and interaction with their environment, typically viewed through a smartphone or tablet camera. 

Blockchain

A decentralised, digital ledger that records transactions across a network of computers using cryptography, creating a secure and transparent record of data. It is the backbone of web3, providing the foundation for a decentralised web.

Cryptocurrency:

A digital or virtual currency that uses cryptography for security. Bitcoin is the first decentralised cryptocurrency, and it is built on blockchain technology.

Cryptography

The practice of secure communication, typically through the use of mathematical algorithms, to protect sensitive information from unauthorised access or tampering.

Decentralised

Refers to a system or network that operates without a central authority or point of control, allowing for distributed power and decision-making among its users or participants. Web3 is based on decentralised technology, which allows for a more open, transparent, and secure web.

Decentralised Application (dApp):

Applications that run on a blockchain network, allowing for a decentralised and distributed system, rather than relying on a central authority. They are open-source, meaning anyone can view and contribute to their code.

Decentralised Autonomous Organisation (DAO): 

A digital organisation that operates on blockchain technology, allowing for decentralised decision making and autonomous operation without the need for a central authority or intermediary.

Decentralised Finance (DeFi):

Refers to a new financial system built on blockchain technology that allows for decentralised control and access to financial services, such as lending and borrowing, without the need for traditional financial intermediaries.

Distributed Ledger Technology (DLT):

A type of database that is spread across a network of computers. It allows multiple parties to have access to the same information and make updates to it in a secure and decentralised way.

Gas Fee:

A fee that is required to execute a transaction on a blockchain network. Gas is paid in the form of cryptocurrency and is used to incentivizse users to validate transactions.

Metaverse:

The Metaverse is a virtual shared space where users can interact, socialise and engage in a fully immersive environment, using advanced technology such as virtual reality and artificial intelligence.

Non-Fungible Token (NFT):

Unique digital assets that use blockchain technology to prove ownership and authenticity. They represent ownership of a digital item such as artwork, music, videos, and more. NFTs can be bought, sold and traded just like physical assets and cannot be replicated or replaced

Peer-to-Peer Network:

A network of devices that communicate directly with each other, without the need for a central server. Web3 technology utilises peer-to-peer networks, which allows for a more decentralised and secure web.

Smart Contract:

A self-executing contract that is written in code and stored on a blockchain covering the terms of an agreement between buyer and seller. It can automatically execute the terms of the contract when certain conditions are met.

Token:

A digital asset that represents a specific value or utility within a decentralized application. Tokens can be traded on cryptocurrency exchanges and can be used to access certain features or services within a dApp.

Virtual Reality (VR):

An immersive technology that simulates a computer-generated environment, allowing users to interact with and experience a different reality. It typically requires the use of a headset and controllers for full immersion.

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Merse Advisory was created to provide credible, objective, and pragmatic advice on the Metaverse and Web3. Merse consultants are immersed in bringing new ideas to life and working with clients to successfully enter the Metaverse. 

For more information, get in touch today.