Buy/Sell Tax
By CoinGecko | Updated on Feb 21, 2022
It is possible to code a smart contract token to have an innate on-chain "tax" whenever someone wants to buy or sell the tokens. The way it works is that a percentage of the tokens being bought or sold is transferred to a preset address - essentially "taxing" the buyer and seller and thus discourage wash trading. However, this code function is can be abused where the tax rate is unreasonable, making it a Honeypot.
Related Terms
Frontrun
To intercept a particularly large AMM buy order for the purpose of purchasing an reselling the assets back to the buyer before the order transaction is mind on the blockchain.
MicroBitcoin (uBTC)
One millionth of a bitcoin or 0.000001 of a bitcoin. Microbitcoin is the abbreviation of uBTC and often misunderstood as the fork of Bitcoin.
Mining Reward
The reward resulting from contributing computing resources to process transactions
Total Value Locked
Total Value Locked (TVL) represents the number of assets that are currently staked in a protocol or the total quantity of underlying amount of funds that a DeFi protocol has secured.
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