Crypto Term

A unique identifier for a cryptocurrency wallet, used to send and receive digital currencies. It’s similar to a bank account number but for blockchain networks.

Example: A Bitcoin address might look like “1A1zP1eP5QGefi2DMPTfTL5SLmv7DivfNa”

A distribution of free cryptocurrency tokens or coins directly to multiple wallet addresses, often used as a marketing strategy or to decentralize token distribution.

Example: Uniswap airdropped 400 UNI tokens to anyone who had used their platform before a specific date.

A type of stablecoin that maintains its peg to another asset through algorithms and smart contracts rather than being backed by collateral.

Example: Terra’s UST was an algorithmic stablecoin that attempted to maintain a $1 value through an algorithmic relationship with the LUNA token.

The highest price a cryptocurrency has ever reached in its trading history.

Example: Bitcoin reached an all-time high of nearly $69,000 in November 2021.

The lowest price a cryptocurrency has ever reached in its trading history.

Example: After the 2022 market crash, many cryptocurrencies hit their all-time lows.

Any cryptocurrency that is not Bitcoin. Alternative coins that emerged after Bitcoin’s creation, short for “alternative coin”.

Example: Ethereum, Litecoin, and Dogecoin are all considered altcoins.

Regulations and procedures designed to prevent criminals from disguising illegally obtained funds as legitimate income, applied to cryptocurrency transactions and exchanges.

Example: Cryptocurrency exchanges implement KYC and AML procedures to verify user identities and monitor suspicious transactions.

A decentralized exchange protocol that uses liquidity pools and a mathematical formula to price assets, eliminating the need for traditional order books.

Example: Uniswap uses an AMM model where prices are determined by the ratio of assets in liquidity pools.

A set of protocols and tools that allows different software applications to communicate with each other, commonly used to integrate cryptocurrency services.

Example: Developers use Coinbase’s API to build applications that can access real-time cryptocurrency price data.

The practice of buying a cryptocurrency on one exchange and selling it on another where the price is higher to profit from the price difference.

Example: A trader buys Bitcoin for $30,000 on Exchange A and immediately sells it for $30,200 on Exchange B, earning a $200 profit.

Specialized hardware designed specifically for mining cryptocurrencies, significantly more efficient than general-purpose computers.

Example: Bitmain’s Antminer S19 is an ASIC miner designed specifically for Bitcoin mining.

A smart contract technology that enables the exchange of cryptocurrencies from different blockchains without using centralized intermediaries.

Example: An atomic swap could allow direct trading of Bitcoin for Litecoin without using an exchange.

Someone who holds onto a cryptocurrency that has significantly decreased in value with the hope that the price will eventually recover.

Example: “He became a bag holder after buying at the peak of the 2021 bull run and refusing to sell during the subsequent crash.”

A protocol that provides programmable liquidity, allowing multiple tokens in varying weights within a single liquidity pool.

Example: A Balancer pool might contain 80% ETH and 20% DAI, unlike Uniswap pools which require 50/50 splits.

A prolonged period of decline in the cryptocurrency market, characterized by falling prices and pessimistic sentiment.

Example: The crypto market experienced a significant bear market throughout 2022.

The first and most well-known cryptocurrency, created by an anonymous person or group using the pseudonym Satoshi Nakamoto in 2009.

Example: Bitcoin pioneered the concept of decentralized digital currency using blockchain technology and prevent double spend.

The ratio of Bitcoin’s market capitalization to the total market capitalization of all cryptocurrencies, expressed as a percentage.

Example: A high Bitcoin dominance often indicates less interest in altcoins, while a declining Bitcoin dominance might signal an altcoin season.

An event that occurs approximately every four years where the reward for mining Bitcoin blocks is cut in half, reducing the rate at which new Bitcoins are created.

Example: The most recent Bitcoin halving occurred in May 2020, reducing the block reward from 12.5 to 6.25 BTC.

A collection of transaction records in a blockchain, grouped together and verified by miners or validators.

Example: Bitcoin generates a new block approximately every 10 minutes, containing the latest verified transactions.

A distributed digital ledger that records all transactions across a network of computers, ensuring transparency and security without a central authority.

Example: The Bitcoin blockchain maintains a permanent, unalterable record of all Bitcoin transactions.

The process by which a transaction is verified and added to a blockchain, with each subsequent block adding another confirmation.

Example: Many exchanges require at least 6 block confirmations before considering a Bitcoin transaction final.

An online tool that allows users to search and navigate through a blockchain, viewing transaction histories, addresses, and other data.

Example: Etherscan allows users to search for and verify Ethereum transactions and smart contracts.

The number of blocks in the chain between a given block and the first block (genesis block).

Example: “Bitcoin reached block height 800,000 in early 2023.”

The cryptocurrency awarded to miners for successfully adding a new block to the blockchain.

Example: Bitcoin miners currently receive 6.25 BTC as a block reward when they mine a new block.

The amount of data that can be stored in a single block on a blockchain, affecting transaction capacity and speed.

Example: Bitcoin’s block size is limited to 1MB (plus SegWit data), which constrains the number of transactions per block.

A mathematical curve that defines the relationship between a token’s price and its supply, often used in decentralized exchanges and token sales.

Example: Some DeFi protocols use bonding curves to automatically adjust token prices as supply changes.

A reward offered for performing specific tasks or identifying bugs in a cryptocurrency project.

Example: A blockchain project might offer a bounty of 1,000 tokens to developers who identify critical security vulnerabilities.

A period of rising prices and optimistic sentiment in the cryptocurrency market.

Example: The crypto bull market of 2020-2021 saw Bitcoin rise from around $7,000 to nearly $69,000.

The process of permanently removing cryptocurrency tokens from circulation by sending them to a wallet address from which they can never be retrieved.

Example: Binance regularly burns a portion of BNB tokens to reduce supply and potentially increase their value.

A cryptocurrency exchange operated by a company that acts as an intermediary between buyers and sellers, maintaining custody of user funds.

Example: Coinbase and Binance are popular centralized exchanges where users can trade cryptocurrencies.

The process of analyzing blockchain data to track transactions, identify patterns, and gather intelligence.

Example: Law enforcement agencies use chain analysis to track illicit funds moving through cryptocurrency networks.

When a blockchain divides into two separate chains, each with its own transaction history and cryptocurrency, typically caused by a contentious hard fork.

Example: The Bitcoin/Bitcoin Cash chain split in 2017 created two separate cryptocurrencies with different block sizes.

The number of cryptocurrency coins or tokens that are publicly available and circulating in the market.

Example: Bitcoin’s circulating supply is approaching 19 million coins, but will never exceed 21 million.

Keeping your cryptocurrency offline to protect it from hacks. It’s the opposite of a “hot wallet”.

Example: Storing your Bitcoin on a USB drive or a hardware wallet like a Ledger Nano X, tucked safely in a drawer.

A position where users lock up collateral to generate a loan, often in the form of a stablecoin.

Example: In the MakerDAO system, users create CDPs by locking ETH as collateral to generate DAI stablecoins.

A method used by blockchain networks to validate transactions and maintain network security.

Example: Proof of Work (used by Bitcoin) and Proof of Stake (used by Ethereum after 2022) are common consensus mechanisms.

A connection that enables the transfer of tokens and data between different blockchain networks that would otherwise be unable to communicate.

Example: The Wormhole bridge allows users to transfer tokens between Ethereum, Solana, and other blockchains without using a centralized exchange.

An extended period of low cryptocurrency prices and market stagnation, similar to a prolonged bear market.

Example: The industry endured a crypto winter from 2018 to 2020 after the 2017 bull market ended.

A digital or virtual currency that uses cryptography for security, typically operating on a decentralized network using blockchain technology.

Example: Bitcoin, Ethereum, and Litecoin are all cryptocurrencies.

The science of secure communications techniques that allow only the sender and intended recipient of a message to view its contents, fundamental to blockchain security.

Example: Cryptocurrencies use public key cryptography to secure transactions between users.

A digital wallet where a third party (like an exchange) controls the private keys to your cryptocurrency.

Example: Funds kept in a Coinbase account are in a custodial wallet, as Coinbase controls the private keys.

An organization represented by rules encoded as a computer program that is transparent, controlled by organization members, and not influenced by a central authority.

Example: MakerDAO is a decentralized organization that governs the DAI stablecoin system.

An application that runs on a decentralized network rather than a single computer, typically using blockchain technology.

Example: Uniswap is a dApp that enables token swaps without a central authority.

An investment strategy where a fixed amount is invested at regular intervals, regardless of asset price, to reduce the impact of volatility.

Example: Instead of investing $1,000 at once, an investor might buy $100 of Bitcoin every week for ten weeks.

A cryptocurrency that has been abandoned, has no trading volume, or has failed due to a scam, hack, or lack of development.

Example: Many ICO tokens from 2017-2018 are now dead coins with no market activity or development.

A system or network that is not controlled by a single central authority, but instead distributed across multiple participants.

Example: Bitcoin is decentralized because no single entity controls its network or monetary policy.

A cryptocurrency exchange that operates without a central authority, allowing for direct peer-to-peer cryptocurrency transactions.

Example: Uniswap and SushiSwap are popular decentralized exchanges on the Ethereum network.

A blockchain-based form of finance that does not rely on central financial intermediaries like banks, instead using smart contracts on blockchain networks.

Example: Platforms like Uniswap and Aave allow users to lend, borrow, and trade cryptocurrencies without traditional bank involvement.

A system allowing individuals to create and manage their digital identities without relying on a central authority.

Example: Self-sovereign identity solutions on blockchain enable users to control their personal data and share only what’s necessary.

The act of assigning your tokens to a validator in a Proof of Stake system to help secure the network and earn rewards without running a validator node yourself.

Example: Cardano holders can delegate their ADA to a stake pool to earn staking rewards.

A financial contract whose value is based on an underlying asset, such as a cryptocurrency.

Example: Bitcoin futures and options are derivatives that allow traders to speculate on Bitcoin’s future price without owning the actual cryptocurrency.

A cryptocurrency wallet that generates addresses and private keys from a single seed, allowing for easy backup and recovery.

Example: HD wallets (Hierarchical Deterministic) generate predictable wallet addresses from a master seed phrase.

The automatic mechanism that adjusts the complexity of mining based on total network computational power to maintain consistent block times.

Example: Bitcoin’s difficulty adjustment occurs every 2,016 blocks to maintain a 10-minute average block time.

A measure of how hard it is to mine a block in a blockchain network, adjusting automatically to maintain consistent block times.

Example: Bitcoin’s mining difficulty increases when more miners join the network, ensuring blocks are produced approximately every 10 minutes.

A non-tangible asset that exists in digital form, including cryptocurrencies, tokens, and NFTs.

Example: Bitcoin, Ethereum tokens, and CryptoPunks NFTs are all considered digital assets.

A mathematical mechanism that verifies the authenticity and integrity of a digital message or document, used to confirm cryptocurrency transactions.

Example: When sending Bitcoin, your wallet creates a digital signature using your private key to prove you authorized the transaction.

An electronic application that allows users to store, send, and receive cryptocurrencies.

Example: MetaMask is a popular digital wallet for storing Ethereum and other ERC-20 tokens.

A database that is consensually shared, replicated, and synchronized across multiple sites, institutions, or geographies.

Example: Blockchain is one type of distributed ledger technology used by most cryptocurrencies.

A potential problem in digital currencies where the same digital token is spent more than once, something blockchain technology was designed to prevent.

Example: Bitcoin’s consensus mechanism prevents double spending by requiring network confirmation before transactions are considered valid.

Very small amounts of cryptocurrency that are often uneconomical to transact with due to transaction fees.

Example: “I have some dust in my wallet—just 0.0000012 BTC that isn’t worth the fees to send.”

A document proposing new features or processes for the Ethereum network, similar to Bitcoin’s BIP system.

Example: EIP-1559 introduced a new fee market to the Ethereum network, changing how transaction fees work.

A type of cryptography used in many blockchain systems for generating key pairs, offering strong security with relatively small keys.

Example: Bitcoin uses a specific elliptic curve algorithm called secp256k1 for its cryptographic operations.

A technical standard for tokens issued on the Ethereum blockchain, defining a common set of rules and functions that an Ethereum token must implement.

Example: Many popular tokens like USDT, USDC, and LINK are ERC-20 tokens built on Ethereum.

A standard for non-fungible tokens on the Ethereum blockchain, allowing for unique, one-of-a-kind tokens that cannot be interchanged equivalently.

Example: Most Ethereum-based NFT collections use the ERC-721 standard.

A token standard on Ethereum that allows for both fungible and non-fungible tokens within the same smart contract, enabling more efficient and flexible token management.

Example: Some gaming platforms use ERC-1155 to represent both unique items (NFTs) and in-game currencies (fungible tokens) in a single contract.

A third-party arrangement where funds are held until certain conditions are met, often implemented in cryptocurrency transactions using smart contracts.

Example: In a peer-to-peer crypto exchange, an escrow smart contract holds the seller’s cryptocurrency until the buyer’s payment is confirmed.

A blockchain platform that enables smart contracts and decentralized applications (dApps), with its native cryptocurrency called Ether (ETH).

Example: Many NFT projects and DeFi applications are built on the Ethereum blockchain.

The runtime environment for smart contracts on Ethereum, processing and executing code across the distributed network.

Example: Developers write smart contracts in languages like Solidity, which are then compiled to bytecode that runs on the EVM.

A platform where users can buy, sell, and trade cryptocurrencies.

Example: Coinbase, Binance, and Kraken are popular cryptocurrency exchanges.

A website or application that distributes small amounts of cryptocurrency for free, typically used for testing or to introduce new users to a cryptocurrency.

Example: Testnet faucets provide free test coins for developers to experiment with blockchain applications without using real money.

Government-issued currency not backed by a commodity, such as US Dollars or Euros.

Example: When you buy Bitcoin with US Dollars, you’re exchanging fiat currency for cryptocurrency.

A service or platform that allows users to exchange fiat currency for cryptocurrency.

Example: Coinbase acts as a fiat on-ramp by allowing users to purchase cryptocurrencies with USD, EUR, and other fiat currencies.

The point at which a transaction can no longer be reversed or altered, and is permanently recorded on the blockchain.

Example: Bitcoin transactions achieve practical finality after 6 confirmations, though theoretical reorgs remain possible.

A type of uncollateralized loan in DeFi where cryptocurrency is borrowed and repaid within the same transaction block.

Example: A trader might use a flash loan to take advantage of arbitrage opportunities between different exchanges or protocols.

A hypothetical scenario where Ethereum’s market cap surpasses Bitcoin’s, becoming the largest cryptocurrency by market capitalization.

Example: “The flippening didn’t happen during the last bull market, but Ethereum enthusiasts believe it might occur in the future.”

The lowest price at which an NFT from a particular collection is listed for sale on marketplaces.

Example: “The floor price for Bored Ape Yacht Club NFTs is currently 80 ETH.”

A split in a blockchain that creates two separate versions, either as a soft fork (backward-compatible) or a hard fork (creating a new cryptocurrency).

Example: Bitcoin Cash was created as a hard fork from Bitcoin in 2017.

The anxiety or apprehension that one might miss an opportunity, particularly in cryptocurrency markets when prices are rising rapidly.

Example: “FOMO drove many new investors to buy cryptocurrencies at peak prices during the 2021 bull run.”

A strategy to influence perception by disseminating negative and dubious information, often used to manipulate cryptocurrency markets.

Example: “The price dropped after FUD about potential regulatory crackdowns spread through social media.”

A property of an asset where individual units are interchangeable and each unit is identical in value and function to any other.

Example: Bitcoin is fungible because any 1 BTC is equal to any other 1 BTC, unlike NFTs which are non-fungible.

Financial contracts obligating the buyer to purchase an asset or the seller to sell an asset at a predetermined future date and price.

Example: Bitcoin futures allow investors to speculate on Bitcoin’s future price without holding the actual cryptocurrency.

A fee paid to miners on the Ethereum network for including transactions in blocks, measured in Gwei.

Example: During network congestion, gas fees can spike, making small Ethereum transactions economically unfeasible.

The maximum amount of gas a user is willing to spend on an Ethereum transaction.

Example: Setting an appropriate gas limit ensures your transaction has enough computational resources to complete without wasting fees.

The amount of Ether a user is willing to pay for each unit of gas, typically denominated in Gwei.

Example: During network congestion, users might set higher gas prices to prioritize their transactions.

The first block of a blockchain, hardcoded into the protocol and has no reference to a previous block.

Example: Bitcoin’s genesis block was mined by Satoshi Nakamoto on January 3, 2009.

A cryptocurrency that gives holders voting rights on proposed changes to a protocol or platform.

Example: UNI token holders can vote on Uniswap improvement proposals and protocol changes.

A denomination of Ether, where 1 Gwei equals 0.000000001 ETH (one billionth of an Ether), commonly used to specify gas prices.

Example: “The current gas price is 25 Gwei, which is relatively low compared to peak periods.”

A scheduled reduction in the block reward for a cryptocurrency, typically programmed to occur at regular intervals.

Example: Bitcoin’s block reward is cut in half approximately every four years, with the most recent halving occurring in 2020.

The maximum amount of funds a cryptocurrency project aims to raise during a token sale or ICO.

Example: “The project has set a hard cap of $20 million for their token sale.”

A permanent divergence from the previous version of a blockchain that requires all nodes and users to upgrade to the latest version of the protocol software. Non-upgraded nodes cannot process or validate new transactions.

Example: Ethereum’s transition from Proof of Work to Proof of Stake (The Merge) was implemented through a hard fork.

A physical device that securely stores cryptocurrency offline, protecting it from online hacks.

Example: Ledger Nano X and Trezor are popular hardware wallet brands.

A fixed-length output produced by a hash function from variable-length input data, used to verify data integrity in blockchains.

Example: Every block in a blockchain contains the hash of the previous block, creating a chain of blocks that ensures data integrity.

An algorithm that converts data of any size into a fixed-size output (hash), with slight changes to input data producing drastically different outputs.

Example: Bitcoin uses the SHA-256 hash function for its proof-of-work mining process.

The speed at which a computer can perform cryptographic calculations, typically used in mining cryptocurrencies.

Example: A higher hash rate means more computational power and potentially more mining rewards.

A wallet that generates a hierarchical tree-like structure of private/public key pairs from a single seed, allowing for better organization and backup.

Example: Most modern cryptocurrency wallets are HD wallets, allowing users to back up all their addresses with a single seed phrase.

A misspelling of “hold” that became a popular term meaning to keep cryptocurrency long-term, regardless of market volatility.

Example: “I’m going to HODL my Bitcoin through this market downturn.”

A cryptocurrency wallet that is connected to the internet, allowing for quick access but potentially more vulnerable to hacking.

Example: Exchange wallets and mobile wallets like Trust Wallet are hot wallets because they’re online and readily accessible.

A fundraising method where new cryptocurrency projects sell tokens to investors.

Example: EOS raised over $4 billion through its ICO in 2018.

A token sale conducted on a decentralized exchange (DEX) directly to the public, often more accessible than traditional ICOs.

Example: “The new project is launching via an IDO on PancakeSwap next week.”

The property of being unchangeable, a key characteristic of blockchain records once they have been confirmed.

Example: Once a Bitcoin transaction has received enough confirmations, it becomes immutable and cannot be reversed.

An investment fund that holds a portfolio of cryptocurrencies designed to track the performance of a specific market index.

Example: A crypto index fund might hold BTC, ETH, and other top cryptocurrencies weighted by market capitalization.

A token sale conducted directly through a cryptocurrency exchange, which typically vets the projects before listing.

Example: Binance Launchpad hosts IEOs for new cryptocurrency projects.

A fundraising method where investors delegate their cryptocurrency to a project’s stake pool, earning the project’s tokens instead of the regular staking rewards.

Example: “The new Cardano project is raising funds through an ISPO, where ADA holders delegate to their stake pool.”

The ability of different blockchain systems to exchange and make use of information.

Example: Projects like Polkadot and Cosmos aim to create interoperability between different blockchains (Cross-Chain Bridge).

A process by which businesses verify the identity of their clients, required by many cryptocurrency exchanges to comply with regulations.

Example: To open an account on Coinbase, users must complete KYC verification by providing identification documents.

The foundational infrastructure upon which Layer 1 blockchains can be built, focusing on interoperability between blockchains.

Example: Polkadot can be considered a Layer 0 blockchain, allowing for custom Layer 1 parachains to be built on top of it.

The base blockchain protocol, such as Bitcoin or Ethereum, that processes and finalizes transactions on its own blockchain.

Example: Bitcoin, Ethereum, and Solana are all Layer 1 blockchain networks.

A secondary framework or protocol built on top of an existing blockchain to improve its scalability and efficiency.

Example: Lightning Network is a Layer 2 solution for Bitcoin that enables faster and cheaper transactions.

A record-keeping system for financial transactions, with blockchains being a specific type of distributed ledger.

Example: The Bitcoin blockchain serves as a public ledger of all Bitcoin transactions ever made.

Using borrowed funds to increase the potential return of an investment in cryptocurrency, amplifying both gains and losses.

Example: A trader using 10x leverage would gain 10% if the price increases by 1%, but would also lose 10% if the price decreases by 1%.

A Layer 2 payment protocol built on top of the Bitcoin blockchain that enables faster and cheaper transactions through payment channels.

Example: Using the Lightning Network, users can make small Bitcoin payments with minimal fees and near-instant confirmation.

The ease with which a cryptocurrency can be bought or sold without causing a significant change in its price.

Example: Bitcoin has high liquidity because it can be traded in large volumes without drastically affecting its market price.

A process where cryptocurrency holders provide assets to liquidity pools in exchange for rewards, typically in the form of governance tokens.

Example: “I’m earning UNI tokens through liquidity mining by providing ETH and USDC to a Uniswap pool.”

A collection of funds locked in a smart contract, used to facilitate decentralized trading, lending, and other financial activities.

Example: Uniswap uses liquidity pools to enable users to trade tokens without traditional order books.

An individual or entity that contributes assets to a liquidity pool in a decentralized exchange or protocol.

Example: Liquidity providers on Uniswap earn trading fees in proportion to their share of the pool.

The fully developed and deployed version of a blockchain where actual transactions take place and have real economic value.

Example: “The project is migrating from testnet to mainnet next month, meaning tokens will have real value.”

The total value of a cryptocurrency, calculated by multiplying its current price by the total number of coins in circulation.

Example: Bitcoin’s market cap often exceeds $500 billion.

An individual or entity that places limit orders to buy and sell assets, providing liquidity and narrowing the bid-ask spread in markets.

Example: Professional market makers help ensure cryptocurrency exchanges maintain liquid markets with tight spreads.

The maximum number of coins or tokens that will ever exist for a particular cryptocurrency.

Example: Bitcoin has a maximum supply of 21 million coins, creating digital scarcity.

The profit that can be extracted from blockchain users by reordering, including, or excluding transactions within blocks.

Example: Flash bots and front-running attacks are common methods used to extract MEV from blockchain networks.

A waiting area for unconfirmed cryptocurrency transactions before they are added to the blockchain.

Example: During high network congestion, transactions with low fees may remain in the mempool for extended periods.

A data structure used in blockchain to efficiently verify the contents of large data sets, summarizing all transactions in a block.

Example: Bitcoin uses Merkle trees to efficiently organize transaction data within each block.

A popular browser extension and mobile app that serves as an Ethereum wallet and gateway to blockchain applications.

Example: Users can connect MetaMask to decentralized applications to interact with smart contracts and manage their Ethereum assets.

The process of validating and adding new transactions to a blockchain, typically involving solving complex mathematical problems.

Example: Bitcoin miners use powerful computers to solve cryptographic puzzles and earn Bitcoin rewards.

A group of cryptocurrency miners who combine their computational resources to increase their chances of finding a block and earning rewards.

Example: F2Pool and Antpool are large mining pools where thousands of miners work together to mine Bitcoin.

A specialized computer system designed specifically for mining cryptocurrencies.

Example: A Bitcoin mining rig might consist of multiple ASIC miners connected to a power supply and cooling system.

The process of validating information, creating a new block, and recording that information onto the blockchain, or creating new tokens or NFTs.

Example: Artists mint NFTs by creating digital tokens that represent ownership of their artwork on the blockchain.

Slang term referring to a cryptocurrency rapidly increasing in value, “going to the moon.”

Example: “Bitcoin is mooning!” might be exclaimed when its price increases dramatically in a short period.

A security feature requiring multiple private keys to authorize a cryptocurrency transaction, rather than a single signature.

Example: A corporate Bitcoin wallet might use multisig requiring 3 out of 5 executives to approve withdrawals.

A computer or server that participates in a blockchain network by maintaining a copy of the blockchain and, in some cases, validating transactions.

Example: Running a Bitcoin full node helps secure the network by validating and relaying transactions.

A type of cryptocurrency service or wallet where users maintain control of their private keys and, consequently, their funds.

Example: MetaMask is a non-custodial wallet as it gives users full control of their private keys and funds.

A unique digital asset representing ownership of a specific item or piece of content on the blockchain.

Example: Digital art pieces sold on platforms like OpenSea are often NFTs.

Transactions or processes that occur outside of the blockchain but may still be connected to blockchain assets.

Example: Lightning Network transactions occur off-chain and are only settled on the Bitcoin blockchain when a payment channel is closed.

Activities that take place directly on the blockchain and are recorded in the distributed ledger.

Example: Standard Bitcoin transactions are on-chain, requiring network confirmations and paying miner fees.

Software whose source code is publicly available, allowing anyone to inspect, modify, or enhance it.

Example: Bitcoin’s codebase is open source, enabling transparency and community contributions to its development.

A service that provides real-world data to blockchains and smart contracts, bridging the gap between blockchain and external systems.

Example: Chainlink oracles provide price feed data to DeFi platforms, enabling accurate token swaps and loans.

Trading that occurs directly between two parties without the supervision of an exchange.

Example: Large Bitcoin transactions are often conducted OTC to avoid moving the market price on exchanges.

A physical document containing printed copies of a cryptocurrency wallet’s public and private keys.

Example: Some users create paper wallets as a form of cold storage by printing their private keys and storing them in a safe.

A decentralized communication model where parties interact directly with each other without a central server or authority.

Example: Bitcoin transactions are peer-to-peer, allowing users to send funds directly to each other without intermediaries.

A blockchain where access is restricted to authorized participants, controlled by one or more entities.

Example: Hyperledger Fabric is a permissioned blockchain often used by enterprises for private business networks.

A blockchain that anyone can join and participate in, without needing approval from a central authority.

Example: Bitcoin is a permissionless blockchain, allowing anyone to run a node or mine without requiring permission.

A fraudulent attempt to obtain sensitive information such as passwords or private keys by disguising as a trustworthy entity.

Example: Crypto users may receive fake emails pretending to be from exchanges asking them to “verify” their wallet details.

A secret alphanumeric code that allows access to cryptocurrency holdings, used to sign transactions and prove ownership.

Example: The private key to a Bitcoin wallet must be kept secure, as anyone with access to it can control the associated funds.

A consensus mechanism that relies on a set of approved validators to create new blocks in a blockchain.

Example: VeChain uses a Proof of Authority consensus where authority nodes are known entities with verified identities.

A consensus mechanism where validators are chosen to create new blocks based on the number of coins they “stake” or lock up as collateral.

Example: Ethereum switched to a Proof of Stake model in 2022.

A consensus mechanism where miners compete to solve complex mathematical problems to validate transactions and create new blocks.

Example: Bitcoin uses Proof of Work as its consensus mechanism.

A set of rules that govern how data is exchanged and processed within a blockchain network.

Example: The Bitcoin protocol specifies how transactions are validated, blocks are created, and consensus is achieved.

A cryptographic code shared publicly and used to receive cryptocurrency, derived from but not revealing the private key.

Example: A Bitcoin address is derived from a public key and can be safely shared with others to receive funds.

A scheme where a group artificially inflates the price of a cryptocurrency (pump) before selling their holdings at the higher price (dump).

Example: Some Telegram groups coordinate pump and dump schemes on low-volume altcoins to profit at the expense of unsuspecting investors.

A two-dimensional barcode that can be scanned with a smartphone to quickly access a cryptocurrency address.

Example: Many cryptocurrency wallets generate QR codes representing public addresses to facilitate easier transfers.

An automatic adjustment of a cryptocurrency’s total supply to achieve a target price or functionality.

Example: Ampleforth is a rebasing cryptocurrency that adjusts its supply daily based on demand to target a stable value.

A technical analysis indicator that measures the speed and magnitude of price movements to evaluate overbought or oversold conditions.

Example: Traders might sell when a cryptocurrency’s RSI exceeds 70, indicating potentially overbought conditions.

A series of words (typically 12 or 24) that can be used to recover a cryptocurrency wallet and its associated private keys.

Example: “Please write down your 24-word recovery phrase and store it in a secure location.”

A technical analysis indicator that measures the speed and change of price movements, used to identify overbought or oversold conditions.

Example: Traders might sell when a cryptocurrency’s RSI exceeds 70, indicating it may be overbought.

A Layer 2 scaling solution that processes transactions off the main blockchain but posts transaction data back to the main chain.

Example: Optimistic and zk-rollups on Ethereum increase transaction throughput while maintaining the security of the main chain.

A performance measure used to evaluate the efficiency of an investment, calculated by dividing the profit by the cost.

Example: “My ROI on Bitcoin since 2020 has been over 300%.”

A scam where cryptocurrency developers abandon a project and run away with investors’ funds.

Example: Many small, unregulated DeFi projects have been known to perform rugpulls.

The smallest unit of Bitcoin, equal to 0.00000001 BTC (one hundred millionth of a Bitcoin), named after Bitcoin’s creator.

Example: “That’ll cost you 500 satoshis” is a way of referring to a small fraction of a Bitcoin.

The pseudonymous person or group who created Bitcoin and published the Bitcoin whitepaper in 2008.

Example: Despite numerous claims and investigations, the true identity of Satoshi Nakamoto remains unknown.

The ability of a blockchain network to handle an increasing amount of transactions and users efficiently.

Example: Bitcoin’s Lightning Network is a solution aimed at improving Bitcoin’s scalability by enabling faster and cheaper transactions.

A fraudulent cryptocurrency created with the intention to steal investor funds.

Example: Many scam tokens create websites that mimic legitimate projects to trick investors into purchasing worthless coins.

A series of words that can be used to access a cryptocurrency wallet, also known as a recovery phrase or mnemonic phrase.

Example: “Never share your seed phrase with anyone, as it provides complete access to your wallet.”

A Bitcoin protocol upgrade that separates signature data from transaction data, increasing the network’s transaction capacity.

Example: SegWit was implemented in Bitcoin in 2017 to help address scaling issues.

A blockchain scaling technique that partitions a network into smaller pieces (shards) to process transactions in parallel.

Example: Ethereum’s roadmap includes sharding to dramatically increase network capacity and reduce fees.

Aggressively promoting a cryptocurrency, often for personal gain and without disclosing financial interests.

Example: “That influencer is shilling low-cap altcoins to his followers without mentioning he’s being paid to promote them.”

A pejorative term for cryptocurrencies perceived to have little to no value or use case.

Example: “Most of the thousands of tokens created during the 2017 ICO boom turned out to be shitcoins with no utility.”

Borrowing a cryptocurrency to sell it, with the intention of buying it back later at a lower price and profiting from the price decrease.

Example: “When the market looked overheated, I decided to short Bitcoin at $60,000 and closed the position at $40,000.”

A separate blockchain that runs parallel to the main blockchain, with a two-way peg that allows assets to be transferred between them.

Example: The Liquid Network is a Bitcoin sidechain that enables faster and more private transactions for traders and exchanges.

The difference between the expected price of a cryptocurrency trade and the actual price at which the trade executes.

Example: “When I tried to swap a large amount of tokens on a DEX with low liquidity, I experienced 5% slippage.”

Self-executing contracts with the terms directly written into code, automatically executing when predetermined conditions are met.

Example: Decentralized lending platforms use smart contracts to automatically issue and manage loans.

A backward-compatible upgrade to a blockchain protocol where only previously valid blocks/transactions are made invalid. Non-upgraded nodes will continue to process transactions as long as they follow the new rules.

Example: The SegWit upgrade in Bitcoin was implemented as a soft fork, allowing non-upgraded nodes to continue operating on the network.

A programming language designed for developing smart contracts that run on the Ethereum Virtual Machine.

Example: Most smart contracts on Ethereum are written in Solidity, including those used for popular DeFi applications.

A cryptocurrency designed to maintain a stable value, often pegged to a fiat currency like the US Dollar.

Example: Tether (USDT) and USD Coin (USDC) are popular stablecoins.

The process of actively participating in transaction validation on a Proof of Stake blockchain by locking up a certain amount of cryptocurrency.

Example: Ethereum holders can stake their ETH to earn rewards while helping to secure the network.

A group of coin holders who combine their resources to increase their chances of being rewarded for validating blocks.

Example: “I joined a Cardano staking pool since I don’t have enough ADA to run my own validator profitably.”

A Layer 2 scaling solution where participants can conduct multiple transactions off-chain, only settling the final state on the main blockchain.

Example: Bitcoin’s Lightning Network uses state channels to enable fast, low-fee transactions that are only settled on the main chain when channels are closed.

The exchange of one cryptocurrency for another, typically through a decentralized exchange.

Example: “I used Uniswap to swap some of my ETH for USDC without using a centralized exchange.”

A separate blockchain used for testing purposes, allowing developers to experiment without using real cryptocurrency.

Example: Bitcoin’s testnet allows developers to test new wallet features without risking actual Bitcoin.

A digital asset created on an existing blockchain, representing various types of value or utility.

Example: Many tokens are created on the Ethereum blockchain using the ERC-20 standard.

The economic system governing how a token is created, distributed, and used within a blockchain ecosystem.

Example: “The project’s token economy includes staking rewards, governance rights, and fee sharing for token holders.”

The process of permanently removing cryptocurrency tokens from circulation by sending them to a wallet address from which they can never be retrieved.

Example: Some projects burn tokens regularly to reduce supply and potentially increase value.

A set of rules and functions that tokens on a particular blockchain must implement for compatibility.

Example: ERC-20, ERC-721, and ERC-1155 are popular token standards on the Ethereum blockchain.

The total amount of a cryptocurrency that will ever exist, including all coins currently in circulation and those yet to be released.

Example: Bitcoin has a total supply cap of 21 million coins.

A measure of a blockchain’s throughput, indicating how many transactions it can process each second.

Example: “While Bitcoin processes around 7 TPS, Solana claims to handle over 50,000 TPS under optimal conditions.”

An automated program that trades cryptocurrencies according to predefined strategies and algorithms.

Example: Many professional traders use trading bots to execute strategies 24/7 without emotion or fatigue.

A small amount paid to miners or validators to process and confirm a cryptocurrency transaction.

Example: Ethereum transaction fees (called “gas fees”) can vary based on network congestion.

A unique identifier assigned to every cryptocurrency transaction, used to track its status on the blockchain.

Example: You can look up a transaction hash on a block explorer to check if your transaction has been confirmed.

A fund of tokens controlled by a project’s team or DAO, used for development, marketing, and other expenses.

Example: “The DAO voted to allocate 1 million tokens from the treasury to fund new protocol upgrades.”

A system that operates correctly and securely without relying on a trusted third party, a fundamental aspect of blockchain technology.

Example: Bitcoin’s trustless system allows users to transact directly without needing to trust each other or an intermediary.

A popular decentralized exchange protocol on Ethereum that uses automated market makers instead of order books.

Example: “I used Uniswap to swap ETH for a new token that isn’t listed on centralized exchanges yet.”

An output of a blockchain transaction that can be spent in the future, used in Bitcoin and some other cryptocurrencies.

Example: Bitcoin wallets calculate your balance by summing all UTXOs associated with your addresses.

A cryptocurrency designed to provide access to a specific product or service within an ecosystem.

Example: “The BNB token has utility for paying reduced fees on the Binance exchange.”

A participant in a Proof of Stake blockchain who is responsible for verifying transactions and maintaining consensus.

Example: Ethereum validators must stake 32 ETH to participate in block validation and earn rewards.

The degree of variation in a trading price over time, with cryptocurrencies often exhibiting high volatility.

Example: Bitcoin’s price can experience double-digit percentage changes within a single day, demonstrating its high volatility.

A digital tool that allows users to store, send, and receive cryptocurrencies.

Example: MetaMask, Trust Wallet, and Exodus are popular cryptocurrency wallets.

A unique string of alphanumeric characters that serves as a destination to send cryptocurrency, derived from a public key.

Example: “Please send the Bitcoin to wallet address 1A1zP1eP5QGefi2DMPTfTL5SLmv7DivfNa.”

The process of buying and selling the same cryptocurrency to create artificial trading volume and manipulate prices.

Example: “Some cryptocurrency exchanges engage in wash trading to appear more liquid and attract new users.”

The concept of a new iteration of the World Wide Web based on blockchain technology, emphasizing decentralization and token-based economics.

Example: Web3 applications like decentralized social media platforms aim to give users ownership over their data and content.

An individual or entity that holds a large amount of a particular cryptocurrency.

Example: A Bitcoin whale might own thousands of bitcoins, capable of significantly impacting market prices.

A document issued by a cryptocurrency project that explains its technology, purpose, and tokenomics.

Example: The Bitcoin whitepaper, published by Satoshi Nakamoto in 2008, outlined the first blockchain-based cryptocurrency.

A token pegged to the value of another cryptocurrency but compatible with a different blockchain.

Example: “WBTC (Wrapped Bitcoin) allows Bitcoin holders to participate in Ethereum-based DeFi protocols.”

The return earned on cryptocurrency holdings through various means such as staking, lending, or providing liquidity.

Example: “By providing liquidity to a stablecoin pair, I’m earning a 15% annual yield in trading fees and reward tokens.”

A practice where cryptocurrency holders provide liquidity to DeFi protocols in exchange for rewards, often in the form of additional tokens.

Example: Users can earn yield by depositing their tokens into liquidity pools on platforms like Curve or Balancer.

A cryptographic method that allows one party to prove to another that a statement is true without revealing any additional information.

Example: “zk-rollups use zero-knowledge proofs to verify transactions on Ethereum while maintaining privacy and reducing gas costs.”

Zero-Knowledge Succinct Non-Interactive Argument of Knowledge; a specific type of zero-knowledge proof used in cryptocurrencies like Zcash.

Example: “Zcash uses ZK-SNARKs to enable users to shield transaction amounts and addresses from public view while still verifying their validity.”