# Glossary

Key terms and acronyms used across the institutional documentation. If you are coming from traditional finance or other blockchain networks, this page will help you navigate Canton-specific terminology.

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## Assets and Tokens

**CBTC (Canton Bitcoin)**

Wrapped Bitcoin on the Canton Network. 1 CBTC is always backed 1:1 by BTC held in decentralized custody. CBTC is the primary asset for institutional trading on Canton.

**CC (Canton Coin)**

The native network rewards token on Canton. CC is earned through eligible transactions and distributed to participants. CC is not a stablecoin. Its value fluctuates based on market conditions.

**USDXLR**

A Canton-native yield-bearing stablecoin. The primary trading pair for CBTC. Trading CBTC/USDXLR earns rewards from both assets.

**USDCx**

A cross-chain stablecoin available on Canton. Provides a familiar stable pairing for BTC traders.

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## Canton Network

**Canton Network**

An institutional-grade blockchain network designed for privacy, compliance, and atomic settlement. All participants are KYC-verified.

**Daml**

Canton's smart contract language. Used for building applications and defining transaction logic on the network.

**CIP-56**

Canton token standard. Defines how tokens (including CBTC) are created, transferred, and managed on Canton.

**Validator Node**

A node that participates in the Canton Network's consensus and transaction processing. Required for direct CBTC minting. Multi-tenant validator options are available for firms that do not want to run their own.

**Multi-Tenant Validator**

A shared validator node operated by a third-party provider. Allows firms to participate in the Canton Network without running their own infrastructure. Lower cost and faster setup than a dedicated node.

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## Security and Custody

**FROST (Flexible Round-Optimized Schnorr Threshold)**

The threshold signature scheme used for CBTC's decentralized custody. FROST allows multiple parties to collectively sign Bitcoin transactions without any single party holding the full private key.

**Attestor Network**

The group of decentralized signers that collectively approve CBTC mints and burns using FROST threshold signatures. Currently operates on a 2-of-4 threshold.

**Threshold (M-of-N)**

The minimum number of attestors required to approve a transaction. For CBTC, 2 out of 4 attestors must sign to authorize a mint or burn.

**Proof of Reserve (PoR)**

Chainlink's verification mechanism confirming that all CBTC in circulation is fully backed 1:1 by BTC held in custody.

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## Trading and Venues

**RFQ (Request for Quote)**

A trading model where a firm requests a price from a market maker and can accept or reject the quote. Used by Elk Capital / Trngle for institutional OTC execution.

**CLOB (Central Limit Order Book)**

A traditional exchange-style order book where buy and sell orders are matched by price and time priority. Used by Temple Digital.

**AMM (Automated Market Maker)**

A DeFi trading model where liquidity pools and mathematical formulas determine prices instead of an order book. Used by Tradefast.

**MEV (Miner/Maximal Extractable Value)**

The profit that can be extracted by reordering, inserting, or censoring transactions in a block. Canton eliminates MEV because it has no public mempool.

**Mempool**

A holding area for unconfirmed transactions visible to all network participants. Canton does not have a public mempool, which prevents front-running and sandwich attacks.

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## Rewards and Economics

**Transaction-Count-Based Rewards**

Canton's reward model where every eligible transaction generates CC rewards regardless of transaction size. High-frequency strategies earn more rewards than low-frequency, high-volume strategies.

**Featured App (FA)**

A Canton application that has been designated as a Featured App, which affects reward multipliers for activity within that application.

**Anti-Gaming Policy**

Canton's tokenomics accountability process that detects and shuts down artificial transaction patterns (such as A to B to A transfers) designed to farm rewards without real economic activity.

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## Agreements and Onboarding

**MSA (Master Service Agreement)**

The standard commercial agreement between a trading firm and BitSafe. Required before a firm can mint CBTC.

**KYC/AML (Know Your Customer / Anti-Money Laundering)**

Compliance checks required during onboarding. All Canton participants must be KYC-verified.

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## Technical

**DAR (Daml Archive)**

A compiled Daml package file used to deploy smart contracts on Canton.

**cbtc-lib**

A Rust library for interacting with CBTC minting and burning functionality. Required for direct minting from BTC.

**Canton SDK**

The software development kit for building applications and submitting transactions on the Canton Network.