Definition: trustless

Not trusted. Not trustworthy. Trustless often refers to Bitcoin, Ethereum and other blockchain-based networks because no individual party that participates in processing that particular blockchain needs to be trusted.

How Can You Trust a Trustless System?
Because there is no single entity that has to be trusted. Thousands of participants work together to keep the blockchain working. A majority of active parties agree which new transactions are valid by reaching consensus.

The blockchain protocol is designed to maintain the integrity of the system, which means that the blockchain itself "is trusted." The trustless term is confusing but careful thinking about naming things in the technology world is often not a priority (see naming misnomers). See consensus mechanism, 51% consensus, blockchain, permissionless and crypto glossary.

Can We Trust a Centralized Exchange?

We may trust the blockchain, but can we trust an exchange that holds our crypto? In 2022, Netflix released this documentary about the founder of a Canadian exchange who supposedly died in 2019 and $200 million in bitcoins disappeared (see Quadriga). See decentralized exchange. (Image courtesy of Netflix.)