An ada amount a wallet pledges when submitting a transaction that runs a Plutus script. Cardano splits script execution into two phases: a cheap phase-1 check (the transaction is well-formed, balanced, properly witnessed) that every node performs, and an expensive phase-2 check (the script actually runs and returns true or false).
If phase-1 passes but phase-2 fails, the wallet's collateral is taken instead of the normal transaction fee. This lets the network charge for the wasted phase-2 work without requiring every node to fully replay failed validations, keeping the eUTxO model's predictable-fee property intact.
Explore next
- Smart ContractSelf-executing code stored on a blockchain that automatically enforces and executes agreement terms when predefined conditions are met.View term
- Plutus CoreCardano's on-chain smart-contract runtime. Higher-level languages (Plinth, Aiken) compile down to Plutus Core for execution.View term
- eUTXOCardano's extension of the UTXO accounting model; each output can carry datum and script logic, so smart contracts express rules without the shared mutable state used by account-based chains.View term
- Collateral PercentageThe protocol parameter that sets how much collateral must be put up relative to a Plutus transaction's fee, currently 150 (i.e. 150% of the fee) on mainnet.View term