# Glossary

**Arbitration Fee:** A refundable fee paid to initiate the arbitration process when there's a disagreement with the Committee's assessment.

**Arbitration Mechanism:** A system allowing security researchers to challenge the Committee's decisions on submissions, with a third-party arbitrator providing an impartial judgment.

**Audit Commencement:** The phase where security researchers submit their findings directly on-chain during an audit.

**Audit Competition Process:** Hats Finance's approach combining traditional audits with decentralized solutions.

**Audit Competition Promotion:** Campaigns launched in partnership with protocols to engage security researchers.

**Audit Competitions:** Events where security professionals compete to uncover vulnerabilities in smart contracts.

**Audit Request Initiation:** The starting point for protocols to engage Hats Finance's audit services.

**Audit Slot Reservation:** Protocols reserve their audit slot by depositing into a dedicated vault.

**Bug Bounties:** Programs that reward individuals for identifying and reporting system vulnerabilities.

**Challenge Period:** A designated timeframe for disputing and reviewing submitted claims.

**Code Update Audit:** A focused audit on new code or modifications, particularly useful for projects with previous audit participation.

**Committee's Preliminary Assessment:** The initial evaluation of a claim by the project's committee.

**Continued Engagement:** Post-audit phase where protocols may opt to keep their vault active for ongoing bug bounties.

**Decentralized Arbitration:** A system for resolving disputes in audit competitions and bug bounty submissions fairly.

**Dynamic Analysis:** Testing smart contracts through unit and integration tests to identify untested areas and potential vulnerabilities.

**Escalation Period for Additional Issues:** A period provided for submitting overlooked issues post-audit.

**Expert Committee:** A group appointed to review disputes and suggest new payouts for challenged claims.

**Hacker:** An individual identifying and reporting potential security vulnerabilities.

**Initial Claim Submission:** The first step in the arbitration process, involving the on-chain submission of findings.

**Kleros Court:** A decentralized service offering final judgment on escalated disputes.

**Liquidity Mining:** A process where users provide liquidity to a project's token pool and receive rewards, often in the project's native tokens.

**Manual Code Review:** A thorough examination of smart contract code by auditors.

**Post-Fix Review and Mainnet Launch Sign-Off:** The final review stage post-fixes, leading to mainnet deployment approval.

**Preliminary Assessment and Proposal:** An initial review by Hats Finance based on provided details, shaping the audit process.

**Public Competition with FCFS Mechanism:** An open audit competition where any auditor can participate and submit vulnerabilities.

**Review of Findings:** The process of evaluating findings during and at the end of an audit competition.

**Safety Period:** A timeframe before public disclosure of a vulnerability for committee review and resolution.

**Scope and Timeline Discussion:** Detailed discussions with the protocol team to define the audit's scope and timeline.

**Solo Auditor Engagement:** A model where individual auditors are given a base fee for auditing contracts and triaging submissions.

**Static Analysis:** Using automated tools to scan code for common errors and known vulnerabilities.

**Triage Competition:** A proposed feature to incentivize community assistance in submission quality control.

**Vault Committee:** A group responsible for governance and claims management within Hats Finance.

**Web3 Security Researchers:** Specialists in identifying and addressing vulnerabilities within blockchain and smart contract ecosystems.

**Whitehats:** Ethical hackers focused on securing systems and reporting vulnerabilities.


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