> ## Documentation Index
> Fetch the complete documentation index at: https://docs.kaleidoswap.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Glossary

> Key terms and concepts for RGB, Lightning Network, and KaleidoSwap

## RGB Protocol

<AccordionGroup>
  <Accordion title="RGB Asset" icon="gem">
    A digital asset created using the RGB protocol. RGB assets are client-validated smart contracts that leverage Bitcoin's security while maintaining scalability and privacy through off-chain validation.
  </Accordion>

  <Accordion title="NIA (formerly RGB20)" icon="coins">
    Non-Inflatable Asset — the RGB interface for fixed-supply fungible tokens, similar to ERC-20 on Ethereum. Used for creating and managing divisible assets like stablecoins or utility tokens. This is the asset type KaleidoSwap trades today.
  </Accordion>

  <Accordion title="IFA" icon="coins">
    Inflatable Fungible Asset — the RGB interface for fungible tokens whose supply can be expanded or replaced by the issuer (mint/burn). Not currently supported by KaleidoSwap.
  </Accordion>

  <Accordion title="UDA (formerly RGB21)" icon="image">
    Unique Digital Asset — the RGB interface for non-fungible tokens (NFTs), comparable to ERC-721. Used for unique digital assets and collectibles. Not currently supported by KaleidoSwap.
  </Accordion>

  <Accordion title="CFA (formerly RGB25)" icon="layer-group">
    Collectible Fungible Asset — the RGB interface for collectibles with rich media and metadata. Not currently supported by KaleidoSwap.
  </Accordion>

  <Accordion title="Asset ID" icon="fingerprint">
    A unique identifier for an RGB asset, typically in the format `rgb:xxxxxx-xxxxxx-xxxxxx`. Each asset has a globally unique ID derived from its genesis transaction.
  </Accordion>

  <Accordion title="Client-Side Validation" icon="shield-check">
    A core RGB concept where asset state and transaction history are validated by clients rather than being stored on the blockchain. This provides enhanced privacy and scalability.
  </Accordion>

  <Accordion title="Consignment" icon="box">
    A data package containing all necessary information to validate an RGB asset transfer, including proofs, history, and state transitions.
  </Accordion>

  <Accordion title="Schema" icon="sitemap">
    The blueprint defining an RGB asset's properties, state transitions, and validation rules. Different interfaces (NIA, IFA, UDA, CFA — formerly RGB20/21/25) enable different asset types.
  </Accordion>
</AccordionGroup>

## Lightning Network

<AccordionGroup>
  <Accordion title="Lightning Network" icon="bolt">
    A Layer 2 payment protocol built on Bitcoin enabling instant, low-cost transactions through off-chain payment channels.
  </Accordion>

  <Accordion title="Payment Channel" icon="arrow-right-arrow-left">
    A bidirectional payment channel between two Lightning nodes allowing multiple transactions without touching the blockchain until the channel is closed.
  </Accordion>

  <Accordion title="Channel Capacity" icon="gauge">
    The total amount of Bitcoin (and potentially RGB assets) locked in a payment channel, determining the maximum transaction size.
  </Accordion>

  <Accordion title="Inbound Liquidity" icon="arrow-down">
    The amount of funds others can send to you through a channel. Determined by your channel partner's balance.
  </Accordion>

  <Accordion title="Outbound Liquidity" icon="arrow-up">
    The amount of funds you can send through a channel. Determined by your balance in the channel.
  </Accordion>

  <Accordion title="BOLT11" icon="receipt">
    The standard Lightning Network invoice format for requesting payments. Contains payment amount, recipient, and other metadata.
  </Accordion>

  <Accordion title="Keysend" icon="paper-plane">
    A Lightning payment method allowing spontaneous payments without requiring an invoice, used for pushing assets or funds.
  </Accordion>

  <Accordion title="HTLC (Hash Time-Locked Contract)" icon="clock">
    A conditional payment mechanism ensuring atomic transactions across Lightning channels using cryptographic hashes and time locks.
  </Accordion>

  <Accordion title="Routing" icon="route">
    The process of finding a path through the Lightning Network to deliver a payment from sender to receiver.
  </Accordion>
</AccordionGroup>

## LSP (Lightning Service Provider)

<AccordionGroup>
  <Accordion title="LSP (Lightning Service Provider)" icon="server">
    A service provider that offers Lightning infrastructure, liquidity, and channel management services to users.
  </Accordion>

  <Accordion title="LSPS (LSP Specification)" icon="file-contract">
    A set of standardized protocols for Lightning Service Providers, defining how they interact with clients.
  </Accordion>

  <Accordion title="LSPS1" icon="hashtag">
    The first LSP specification defining channel opening and liquidity services. KaleidoSwap implements LSPS1 for RGB-enabled channels.
  </Accordion>

  <Accordion title="Channel Request" icon="hand">
    A request from a client to an LSP to open a Lightning channel with specific parameters like capacity and asset allocation.
  </Accordion>

  <Accordion title="JIT Channel" icon="zap">
    Just-In-Time channel opening where an LSP opens a channel on-demand when a user receives a payment, providing instant onboarding.
  </Accordion>
</AccordionGroup>

## KaleidoSwap Specific

<AccordionGroup>
  <Accordion title="RGB-LSP" icon="palette">
    A Lightning Service Provider that supports RGB assets in payment channels, enabling instant RGB asset transfers over Lightning.
  </Accordion>

  <Accordion title="Atomic Swap" icon="atom">
    A trustless exchange of one asset for another that either completes entirely or fails entirely, with no possibility of partial execution.
  </Accordion>

  <Accordion title="Swap Order" icon="rectangle-list">
    An order to exchange one asset for another at a specified price, which can be settled on-chain or via Lightning.
  </Accordion>

  <Accordion title="RFQ (Request for Quote)" icon="comment-dollar">
    A request to get a price quote for swapping between two assets. Quotes are valid for a limited time.
  </Accordion>

  <Accordion title="Swapstring" icon="link">
    A compact string encoding all parameters of a swap transaction, used for coordinating atomic swaps between parties.
  </Accordion>

  <Accordion title="Settlement Type" icon="handshake">
    The method used to finalize an asset transfer - either LIGHTNING (instant via payment channels) or ONCHAIN (via Bitcoin transactions).
  </Accordion>

  <Accordion title="Asset Delivery" icon="truck">
    The process of transferring RGB assets through Lightning channels using keysend after a channel is opened.
  </Accordion>

  <Accordion title="Rate Decision" icon="scale-balanced">
    When market rates change significantly during order processing, users can choose to accept the new rate or request a refund.
  </Accordion>
</AccordionGroup>

## Bitcoin & On-Chain

<AccordionGroup>
  <Accordion title="Satoshi (sat)" icon="bitcoin-sign">
    The smallest unit of Bitcoin, equal to 0.00000001 BTC. All amounts in KaleidoSwap are denominated in satoshis.
  </Accordion>

  <Accordion title="Millisatoshi (msat)" icon="coins">
    One-thousandth of a satoshi, used for precise calculations in Lightning Network payments (not enforceable on-chain).
  </Accordion>

  <Accordion title="UTXO (Unspent Transaction Output)" icon="cube">
    A discrete chunk of Bitcoin that can be spent. RGB assets are anchored to specific UTXOs on the Bitcoin blockchain.
  </Accordion>

  <Accordion title="Confirmation" icon="check-double">
    When a Bitcoin transaction is included in a block on the blockchain. More confirmations mean higher security against reorganization.
  </Accordion>

  <Accordion title="Mempool" icon="inbox">
    The pool of unconfirmed Bitcoin transactions waiting to be included in the next block.
  </Accordion>

  <Accordion title="Fee Rate" icon="gauge-high">
    The cost per byte to include a transaction in a Bitcoin block, typically measured in satoshis per virtual byte (sat/vB).
  </Accordion>

  <Accordion title="Testnet" icon="flask">
    A separate Bitcoin network used for testing, where coins have no real value.
  </Accordion>

  <Accordion title="Signet" icon="pen-nib">
    A newer test network with more predictable block times, used for development and testing.
  </Accordion>

  <Accordion title="Regtest" icon="wrench">
    Regression test mode allowing developers to create local private Bitcoin networks for testing.
  </Accordion>
</AccordionGroup>

## Wallet & Security

<AccordionGroup>
  <Accordion title="Mnemonic Seed" icon="key">
    A 12 or 24-word phrase that can restore your entire wallet. Must be kept secure and private.
  </Accordion>

  <Accordion title="Public Key" icon="lock-open">
    The public portion of a cryptographic key pair, safe to share. Used to receive payments and verify signatures.
  </Accordion>

  <Accordion title="Private Key" icon="lock">
    The secret portion of a cryptographic key pair, never to be shared. Used to sign transactions and prove ownership.
  </Accordion>

  <Accordion title="Derivation Path" icon="code-branch">
    A scheme for generating multiple keys from a single mnemonic seed in a deterministic way.
  </Accordion>

  <Accordion title="Watch-Only Wallet" icon="eye">
    A wallet that can view balances and transactions but cannot sign or send transactions.
  </Accordion>

  <Accordion title="Channel Backup" icon="floppy-disk">
    A backup file containing essential data to recover Lightning channel funds in case of data loss.
  </Accordion>
</AccordionGroup>

## Trading & Market

<AccordionGroup>
  <Accordion title="Trading Pair" icon="scale-unbalanced">
    A combination of two assets that can be traded against each other, e.g., BTC/USDT.
  </Accordion>

  <Accordion title="Base Asset" icon="b">
    The first asset in a trading pair - what you're buying or selling.
  </Accordion>

  <Accordion title="Quote Asset" icon="q">
    The second asset in a trading pair - what you're paying with or receiving.
  </Accordion>

  <Accordion title="Precision" icon="calculator">
    The number of decimal places an asset supports. For example, USDT typically has 6 decimals of precision.
  </Accordion>

  <Accordion title="Maker" icon="user-tie">
    The party providing liquidity by creating a swap offer that others can accept.
  </Accordion>

  <Accordion title="Taker" icon="user">
    The party consuming liquidity by accepting an existing swap offer.
  </Accordion>

  <Accordion title="Slippage" icon="arrow-trend-down">
    The difference between expected price and actual execution price, typically due to market movement or liquidity constraints.
  </Accordion>

  <Accordion title="Order Status" icon="list-check">
    The current state of a swap order: OPEN, PENDING\_PAYMENT, PAID, EXECUTING, FILLED, CANCELLED, EXPIRED, or FAILED.
  </Accordion>
</AccordionGroup>

***

<Note>
  This glossary is continuously updated. If you encounter unfamiliar terms not listed here, please let us know via our [support channels](/desktop-app/support/additional-resources).
</Note>