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2. Intermediate Course

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  1. 1. What is Layer 0 in Blockchain technology?
  2. 2. What is layer 1 in Blockchain?
  3. 3. Second layer (layer 2) - what is it? 
  4. 4. Blockchain and its layers - What is layer three in Blockchain (L3)?
  5. 5. Ethereum 2.0 - What is it? 
  6. 6. Ethereum Proof-of-Stake (PoS) - what should you know?
  7. 7. Ethereum London Hard Fork - what is it ? 
  8. 8. What is the Ethereum Name Service (ENS) and how does it work?
  9. 9. Arbitrum: Ethereum scaling solution - everything you need to know
  10. 10. Polygon 2.0 - the value layer for the Internet
  11. 11. Ethereum ERC-4337 - what is it and how does this standard work?
  12. 12. What is an ERC20 token and how is it created?
  13. 13. The ERC-721X VS ERC-721 Standard – Key Differences!
  14. 14. What is cryptocurrency burning?
  15. 15. Examples of the use of WEB3 on the blockchain
  16. 16. What is Web5? 
  17. 17. Blockchain Oracle - what are oracles? 
  18. 18. Polkadot - Decentralized blockchain and DOT cryptocurrency
  19. 19. Polkadot Parachain - Next-generation blockchain
  20. 20. Interoperability in the world of cryptocurrencies and blockchain
  21. 21. What is Blockchain sharding?
  22. 22. Mainnet versus Testnet on the Blockchain. The complete guide!
  23. 23. MINA Protocol: the lightest blockchain in the world!
  24. 24. Sustainable Blockchain - Proof of Useful Work & Flux
  25. 25. Cosmos SDK: Building the Blockchain Ecosystem
  26. 26. What is cross-chain interoperability in Blockchain technology?
  27. 27. Blockchain trilemma - explanation of the problem. What is the impact on cryptocurrency payments?
  28. 28. Non-fungible tokens and NFT exchanges
  29. 29. How to make money with NFT?
  30. 30. What is the NFT licence fee?
  31. 31. NFT Gas Fee - what is it? How can you reduce your gas fee?
  32. 32. The main differences between static NFT and dynamic NFT
  33. 33. What is minting an NFT?
  34. 34. What are NFT Ordinals? A guide to Bitcoin NFT.
  35. 35. What is KnowOrigin NFT, and how does it work?
  36. 36. ERC-6551 - the new NFT standard. What does it bring to the non-exchangeable token sector?
  37. 37. What is NFT Lending all about? An innovative solution in the world of cryptocurrencies!
  38. 38. The Metaverse – a new virtual world
  39. 39. Metaverse – TOP 15 virtual reality projects
  40. 40. Technical analysis – is it worth using?
  41. 41. Trading order types: stop loss, trailing stop loss, LIMIT
  42. 42. Market Cap versus Fully Diluted Market Cap - the most important differences you should know!
  43. 43. Set up of Stop Loss and Take Profit orders
  44. 44. What are DeFi liquidity pools?
  45. 45. Real Yield in DeFi - what is this trend? What does it consist of?
  46. 46. Vampire Attacks in Decentralized Finance (DeFi): Explanation and Examples
  47. 47. What are wrapped tokens 
  48. 48. What are security tokens?
  49. 49. What are Social Tokens? 
  50. 50. Liquidity Provider Tokens (LPs). What are they, and why are they so important?
  51. 51. What is the Lightning Network, and how does it work?
  52. 52. What is Play-to-Earn (P2E) and how does it work?
  53. 53. Cryptocurrency steps - What is move to earn M2E?
  54. 54. Segregated Witness - what is Segwit Bitcoin all about?
  55. 55. What are Decentralized Cryptocurrency DEX Exchanges?
  56. 56. What is Curve Finance?
  57. 57. What is GameFi and how does it work?
  58. 58. What is Proof of Reserves (PoR)? How does it work?
  59. 59. DAO Investment: A revolution in the world of finance and investment
  60. 60. What is MakerDAO and DAI Stablecoin?
  61. 61. What is the SubDAO protocol, and how does it work?
  62. 62. How to Create Your Own Decentralized Autonomous Organization (DAO)?
  63. 63. Atomic Swap: What is an atomic swap, and how does it work with cryptocurrencies?
  64. 64. What Is Cryptocurrency Vesting? What Are Its Advantages?
  65. 65. What Is the Metaplex Candy Machine Protocol? How Does It Work?
  66. 66. What Is the BNB Greenfield Ecosystem?
  67. 67. What Is Slashing in Cryptocurrencies?
  68. 68. Royalties – What Are They? How Does This Type of Licensing Fee Work?
  69. 69. What is TradFi? The importance for cryptocurrencies!
  70. 70. What is the Real World Asset (RWA) trend in cryptocurrencies? Explanation and examples!
  71. 71. Pyth Network: a powerful oracle harnessing the power of Solana!
  72. 72. What are stables in the world of cryptocurrencies?
  73. 73. What Is Binance Oracle?
  74. 74. Shibarium: A new era in the Shiba Inu ecosystem?
  75. 75. What is an ETF? How will an exchange-traded fund on bitcoin work?
  76. 76. Symmetric and asymmetric encryption - key cryptography techniques!
  77. 77. Hedging in cryptocurrencies - great portfolio protection against risk!
  78. 78. How to create your own cryptocurrency? 
  79. 79. What is a Dusting Attack in cryptocurrencies? How to protect against it?
  80. 80. What is a Black Swan?
Lesson 67 of 80
In Progress

67. What Is Slashing in Cryptocurrencies?

The Proof-of-Stake consensus is used to validate transactions and generate new blocks. The entire process requires that validators receive rewards and appropriate compensation for their work.

However, it can happen that validators may intentionally or completely inadvertently engage in activities that harm the proper functioning of the entire blockchain. And this is where crypto slashing appears.

What is this action? What are its causes? Let’s dig deeper into this topic!

Crypto Slashing – Definition

The term is used to refer to validators who violate the principle of proper staking of cryptocurrencies. The main purpose of slashing is to promote appropriate behavior, adherence to the rules in the protocol and responsibility for one’s actions. This punishment encourages participants in a given network to act honestly and eliminate inappropriate behavior.

Simply put, slashing is part of the Proof-of-Stake consensus, which bans validators with bad intentions.

How Does Slashing Work?

As mentioned earlier, slashing serves as a punishment for inappropriate behavior by validators. It entails reducing a portion of their rewards due to violations of specific network rules.

Remember that validators are key participants in a given protocol or ecosystem. They earn money by verifying transactions and creating new blocks on the chain. For a validator to gain this responsible function, they must first pledge a certain amount of a given cryptocurrency to the network. This is a kind of security and motivates validators to act honestly. Thus, if a validator intentionally engages in something that harms the network, he may lose some of his funds through slashing.

Of course, the severity of the penalty varies from protocol to protocol. But the principle is common – slashing involves some specific percentage that is deducted from the validator’s rate, for each negligence. You probably want to ask at this point – can there be a situation where a validator has been so negligent in his duties that his entire account has been subject to slashing? Yes. This results in the removal of the validator from the community.

Reasons for Slashing

There are three main causes of crypto slashing. The first is the so-called downtime. Each network expects validators to be on standby at all times and to participate in the ecosystem. So if a given validator’s node is offline for an extended period of time, it causes delays in block production. The effect? The overall security of the entire network is reduced. For such behavior, the validator is subject to slashing.

The second reason is double signing. This offense is definitely more serious than downtime. It also involves a much greater penalty. What is involved? Double signing occurs when a validator signs two blocks at the same time – it doesn’t matter whether this procedure is accidental or intentional. This behavior triggers a backup node, which, as you probably know, results in nothing good for the primary chain.

The third is to manipulate the network and, more specifically, the consensus process. Beyond simply participating in the network, validators must completely avoid ill-intentioned behavior that potentially compromises the protocol. Understanding these principles is essential for anyone who wants to act as a network validator.

How to Minimize the Risk of Slashing?

We know – losing capital really hurts. Especially since when you invest in digital assets, you’re setting yourself up for profit, not loss. The good news, however, is that there are many ways to minimize the risk of slashing while still making money through staking.

For example, you can choose projects that do not use slashing. This group includes, for example: VeChain, Neo, Tron, Algorand or Band.

All right, but what about when you are nevertheless interested in a project that uses slashing? You can minimize the risk. Before you start staking, take a look at the rules of the protocol. Some of them are really tolerant, and in order to lose some of your funds, you have to really make an effort.

Trustworthy validators are invaluable to a particular network. The revenue of a given protocol depends on them. No wonder, that the developers of a network decide them so carefully and pay special attention to their behavior. In the case of downtime, part of the reward will be lost not only for the validator, but for the entire network!


If you have aspirations to be a validator, you need to understand what slashing is and the consequences that come with it. Understanding this is not difficult, and it will help you avoid behaviors that are subject to penalties in the ecosystem.