Crypto Fundamentals for Absolute Beginners.

What is blockchain, really?

Forget every dramatic explanation you've seen on YouTube. Blockchain is just a shared notebook. Imagine you and 100 friends keep a notebook that records who owes whom money. Everyone has an identical copy. Whenever someone makes a payment, every notebook is updated at the same time. To cheat — say you wanted to erase a debt — you'd have to bribe more than half of the people to change their notebooks in unison. With 100 friends that's hard. With a million strangers, it's effectively impossible.

That's what blockchain is. A notebook of transactions, stored on thousands of computers, all kept in sync by a clever piece of math. The "cryptocurrency" is just the unit of value that the notebook tracks.

What is a wallet?

A "wallet" is a misleading word. A crypto wallet doesn't hold money — it holds the key that proves the money on the blockchain belongs to you. Think of it more like a signet ring. The money sits on the public notebook. Whoever holds the ring can sign payments out of that account.

This means two things:

• If you lose the ring (your seed phrase), no one — not BABA, not the blockchain, not anyone — can recover your money. It's gone.
• If someone else gets the ring, they can sign payments out of your account as if they were you. There is no fraud reversal.

This is why people obsess over "seed phrases." They are the ring. Treat them like the spare key to a vault.

What is an address?

Your blockchain address is the equivalent of a bank account number — except it's public, you can have as many as you want, and you create them yourself instead of asking a bank for permission. It looks like 0x2AFE5FFe043C1c45843076E65BF93517d37d1Ed7.

Anyone can send money to your address. To send money from your address, you need the ring (your wallet's seed phrase). That asymmetry — public to receive, private to send — is the entire genius of the system.

What is gas?

Every time you make a transaction on a blockchain, you pay a tiny fee called gas. This pays the computers that maintain the notebook. The fee changes based on how busy the network is — like Uber surge pricing. On Ethereum mainnet, gas can cost $5–50 per transaction. On modern Layer 2 chains like Base, Arbitrum, or Hyperliquid, it's typically less than $0.10.

You can't pay gas with regular money. It has to be paid in the chain's native token (ETH on Ethereum/Base/Arbitrum, etc.). This is why your first task on any new chain is always: get a tiny amount of the native token to cover gas.

What is a stablecoin?

Most cryptocurrencies (Bitcoin, Ethereum) bounce in price all day. Stablecoins are crypto tokens that are pegged 1:1 to the US dollar — the most common are USDC and USDT. One USDC is always worth one USD, give or take a fraction of a cent.

Stablecoins are the workhorse of crypto trading. They let you hold "cash" on-chain without converting to actual cash. You move stablecoins between venues, you collateralise trades with stablecoins, you measure profit and loss in stablecoins.

For the BABA universe specifically, USDC is the primary stablecoin you'll use — it's accepted on Hyperliquid, GRVT, most DEXes, and is widely trusted (audited monthly, fully reserved with actual dollars in regulated US banks).

What is an exchange vs a DEX?

There are two kinds of places to trade crypto:

• Centralised exchanges (CEX) — Binance, Coinbase, Kraken. They hold your money for you. You deposit, you trade, you withdraw. They have customer support, KYC, and the legal protections (and risks) of a regulated company. They can also freeze your account, go bankrupt with your money (see FTX), or get hacked.
• Decentralised exchanges (DEX) — Uniswap, Aerodrome, Hyperliquid. There is no company holding your money. You connect your wallet, sign a transaction, and trade directly with the blockchain. No KYC, no freezes, no bankruptcy risk. The trade-off: no customer support, no fraud reversal, if you mess up you can lose everything irretrievably.

BABA is built around DEX trading because that's the only way "trustless" actually works. We never have to trust a company to hold your money safely, because no company holds it. You do.

What does "perpetual" or "perp" mean?

A perpetual futures contract (or "perp") is a way to bet on the price of an asset going up or down, without owning the asset itself. If you buy a $1,000 Bitcoin perp and Bitcoin goes up 5%, you make $50 — even if you never actually held any Bitcoin.

Perps are useful because:

• You can bet on down price moves (called "shorting") as easily as up
• You can use leverage — control a $1,000 position with $100 of capital (10x leverage). This amplifies wins and losses equally.
• Many perps are settled in stablecoins, so you don't need to actually hold the underlying asset

Perps are also where most retail traders blow themselves up. Leverage cuts both ways — a 10% move against you on 10x leverage wipes you out entirely. The BABA Academy modules and Cohort 2 spend a lot of time on this.