CRYPTO GLOSSARY
New to the world of cryptocurrency or just need a refresher? Our Crypto Glossary is here to help! Explore clear and concise definitions of common crypto terms and jargon to enhance your understanding and navigate the crypto space with confidence.
Ox Protocol
0x is an Ethereum-based open-source platform for exchanging cryptocurrencies. It allows for the creation of features in a decentralized exchange (DEX), a wallet or a marketplace.
401(k) Plan
A 401(k) plan is a retirement savings program sponsored by US companies where employees contribute part of their income and the employer matches the contributions.
51% Attack
If more than half the computer power or mining hash rate on a network is run by a single person or a single group of people, then a 51% attack is in operation.
Aave
A decentralized lending and borrowing platform on Ethereum. Users can take out loans by providing collateral in the form of crypto assets. Lenders receive aTokens in return, which pay interest automatically. Aave introduced "flash loans," allowing for uncollateralized lending as long as the principal is repaid within the same Ethereum transaction block.
Airdrop
A method of distributing cryptocurrency for free, often used to attract or reward users. It can occur during hard forks, project launches, or to incentivize community engagement.
Algorithm
A set of well-defined instructions for performing a calculation or solving a problem.
Allocation
The portion of assets or funds assigned to a particular investment. In portfolios, allocation determines the percentage held in different asset classes.
Altcoin
Any cryptocurrency that is not Bitcoin. Examples include Ethereum (ETH), Ripple (XRP), and Litecoin (LTC).
AML (Anti-Money Laundering)
Regulations and procedures aimed at preventing illegal income-generating activities, such as money laundering.
Amortizing
Spreading an initial cost over time. In crypto networks, this helps lower individual transaction fees by dividing them across a large user base.
API (Application Programming Interface)
Software that enables different applications to communicate and exchange data.
Arbitrage
Profiting from price differences across exchanges. For example, buying Bitcoin at a lower price on one exchange and selling it at a higher price on another.
Ashdraked
Losing all funds by continuously betting against a rising market, particularly associated with shorting Bitcoin.
ASIC-resistant
A cryptocurrency designed to resist mining by ASIC (Application-Specific Integrated Circuit) machines, often to promote more decentralized mining.
Ask Price
The price at which a seller is willing to sell their cryptocurrency.
ATH (All-Time High)
The highest price ever reached by an asset.
Atomic Swap
A smart contract technology enabling users to trade cryptocurrencies across different blockchains without using intermediaries.
Backdoor
A method allowing unauthorized access to systems or networks, often used maliciously to gain control or retrieve data.
Backtesting
Using historical data to test the effectiveness of a trading strategy, though past performance does not guarantee future results.
Bagholder
An investor holding a declining asset after a failed attempt to sell at a profit.
Bandwidth
The maximum data that can be transmitted over a network within a specified time.
Bear
A trader who believes the market will decline. A bear market is characterized by falling asset prices.
Bear Trap
A situation where prices drop, prompting selling, then reverse to rise, trapping those who sold
Bid Price
The price at which a buyer is willing to purchase an asset.
Bid-Ask Spread
The difference between the bid price (buyer’s offer) and the ask price (seller’s offer).
Bitcoin
The first and most widely known cryptocurrency. It is a decentralized digital currency allowing peer-to-peer transactions.
Bitcoin ATM
A machine that enables users to buy Bitcoin with cash or a debit card.
Block Height
The number of confirmed blocks in a blockchain up to a specific block.
Blockchain
A decentralized, public ledger used to record transactions across multiple computers
Breakout
When an asset’s price moves beyond its support or resistance levels.
Bubble
A market state where prices inflate rapidly before a sudden collapse.
Centralized
A system or organization controlled by a single entity or authority
Close
The end of a trading session, or the closing of a position in a trade.
Coin
A cryptocurrency operating on its own blockchain.
Cold Storage
Offline storage for cryptocurrency, typically on hardware or paper, providing additional security.
Collateral
An asset pledged as security for a loan.
Confirmation Time
The time between submitting a transaction to the network and its inclusion in a confirmed block.
The time between submitting a transaction to the network and its inclusion in a confirmed block.
Crypto Exchange
A platform for trading, buying, or selling cryptocurrencies.
Cryptojacking
Unauthorized use of someone’s device to mine cryptocurrency.
Custody/Custodial Exchange
Custodial exchanges control user assets or private keys, meaning they hold some control over funds or data
Dead Cat Bounce
A short-term recovery in a declining market, followed by further decline.
Decentralization
Distribution of control from a central entity to multiple entities.
Decentralized Application (dApp)
An application running on a decentralized network, like a blockchain, and not controlled by a central authority.
Decentralized Autonomous Organization (DAO)
A digital organization governed by rules encoded as computer programs.
Decentralized Exchange (DEX)
A peer-to-peer exchange where users trade directly without intermediaries.
An instant cryptocurrency exchange that allows users to exchange, buy, sell, and trade cryptocurrency in a fast manner.
Deposit Fee
A fee applied by some exchanges when depositing funds.
Depth Chart
A graphical representation of buy and sell orders in a market.
Derivatives Market
A market for financial products, like futures and options, whose value derives from other assets.
Deterministic Wallet
A type of wallet that generates all keys from a single seed phrase, enabling easy backup.
Difficulty
A measure of how challenging it is to mine a block on a blockchain.
Diversification
The practice of spreading investments across various assets to reduce risk.
Double-Spending
Attempting to spend the same cryptocurrency unit more than once.
DYOR (Do Your Own Research)
A reminder for investors to independently research before investing.
Eclipse Attack
An attack that isolates a target’s view of a network, potentially influencing transactions.
Encryption
Converting data into code to prevent unauthorized access.
ERC-20
A popular technical standard on Ethereum for creating tokens.
ERC-721
The Ethereum standard for creating non-fungible tokens (NFTs).
ETF (Exchange-Traded Fund)
A fund traded on exchanges that holds a collection of assets.
Ethereum
An open-source blockchain with smart contract functionality.
Exchange
A platform for trading cryptocurrency with other crypto or fiat.
Fiat Currency
Government-issued currency not backed by a physical commodity, like USD or EUR.
FOMO (Fear of Missing Out)
Anxiety about missing a potential gain or experience, often leading to impulsive decisions.
Forced Liquidation
The automatic sale of assets to meet margin requirements.
FUD (Fear, Uncertainty, and Doubt)
Intentional spread of negative information, often to influence market prices
Fundamental Analysis
Evaluating an asset’s value based on publicly available information.
Futures
A contract to buy or sell an asset at a set price on a future date.
Gas
The fee paid to execute transactions or contracts on the Ethereum blockchain.
Genesis Block
The first block in a blockchain, also known as Block 0.
Going Long/Short
A strategy where traders profit from rising (long) or falling (short) asset prices.
Gwei
A unit of Ethereum, where 1 Gwei = 0.000000001 ETH.
Halving
An event where mining rewards are cut in half, reducing the rate at which new units are created.
Hardware Wallet
A device for securely storing cryptocurrency offline.
High-Frequency Trading
A trading strategy where large numbers of orders are executed per second using algorithms.
HODL
A misspelled term for “hold,” indicating a long-term hold strategy without selling.
Hot Wallet
An online-accessible wallet, less secure than offline (cold) storage.
Initial Coin Offering (ICO)
A method for raising funds by selling new tokens to the public.
Interoperability
The ability of blockchain systems to communicate and exchange information with each other
Instant Settlement
A transaction that completes almost immediately after initiation.
InterPlanetary File System (IPFS)
An ambitious open-source project that aims to build a massive peer-to-peer file system
JavaScript Token (JST)
A token standard for creating dApps.
JOMO
Joy of missing out, a trading concept when traders should sometimes take a time-out to carefully assess the situation, without worry that they will miss a good deal.
KYC (Know Your Customer)
A process for verifying user identity, often required by exchanges.
Leverage
Using borrowed funds to increase investment size, amplifying gains or losses.
Liquidity
The ease with which an asset can be converted to cash or other assets without affecting price.
Limit Order
An order to buy or sell an asset at a specified price or better.
Mainnet
The primary network where a blockchain operates and its native cryptocurrency is transacted.
Market Cap
The total value of a cryptocurrency, calculated by multiplying the circulating supply by its price.
Mining
The process of verifying and adding transactions to a blockchain, with miners receiving rewards for their work.
Margin Call
What is Margin call? It’s a situation when one or more securities in the trader’s account have fallen below a certain threshold, prompting the trader to either deposit more money or sell some assets.
Market Capitalization
It refers to the total value of the crypto, this is calculated by multiplying the price of a single coin on the total amount of coins.
Master Node
The Masternodes require initial collateral to operate and play a special role in governing the blockchain.
Node
A computer that participates in a blockchain network by storing and verifying transaction data.
Nonce
A unique, arbitrary number used in cryptographic communication, often essential in mining to vary input and meet proof-of-work conditions.
NFT (Non-Fungible Token)
A digital asset representing ownership of a unique item or piece of content, like art or collectibles, stored on the blockchain.
Network
The collection of nodes that work together to process transactions and secure a blockchain.
Open Source
Software with a publicly accessible codebase that anyone can inspect, modify, and enhance.
Oracles
Services that provide real-world data to smart contracts, enabling them to execute based on external events, such as weather or asset prices.
Peer-to-Peer (P2P)
A decentralized communication model where two or more computers directly interact without a central authority.
Private Key
A secret cryptographic key that grants access to a cryptocurrency wallet. Private keys should never be shared.
Public Key
A cryptographic key that can be shared openly and is used to receive cryptocurrency.
Proof of Work (PoW)
A consensus mechanism where miners solve complex puzzles to validate transactions and create new blocks.
Proof of Stake (PoS)
A consensus mechanism where validators are chosen based on their stake (amount of cryptocurrency held) rather than computing power.
Pump and Dump
A scheme where the price of an asset is artificially inflated before large-scale selling occurs, causing a rapid drop in value.
QR Code
A machine-readable code used to store information, like a cryptocurrency wallet address, for easy transactions.
REKT
A slang term for “wrecked,” used to describe severe financial losses in trading.
Ring Signature
A cryptographic technique used for privacy by mixing a transaction’s sender with others to make tracking harder.
ROI (Return on Investment)
A measure of profitability, calculating the gain or loss of an investment relative to its cost.
Rug Pull
A type of scam where developers abandon a project and abscond with investor funds.
Satoshi
The smallest unit of Bitcoin, equal to 0.00000001 BTC.
Satoshi Nakamoto
The pseudonymous creator(s) of Bitcoin and its original whitepaper.
Scalability
A blockchain’s capacity to handle an increasing number of transactions
Seed Phrase
A series of random words that provide access to a wallet. It’s crucial to store it securely, as it allows wallet recovery.
SHA-256
A cryptographic hash function used in Bitcoin’s proof-of-work algorithm, producing a 256-bit signature for data integrity.
Sharding
A scaling technique where a blockchain is divided into smaller parts (shards) that work independently, enabling faster processing.
Sidechain
An independent blockchain linked to a main chain, often used to test new features or improve scalability.
Smart Contract
A self-executing contract with the terms of the agreement directly written into code, running on a blockchain.
Stablecoin
A cryptocurrency pegged to a stable asset, like the USD, to reduce volatility.
Staking
The process of participating in a blockchain network by locking up funds to help validate transactions, typically in PoS networks.
Supply Chain
The entire process of producing and distributing a product, often made transparent through blockchain.
Swap
Exchanging one cryptocurrency for another, either on an exchange or through a smart contract.
Testnet
A blockchain used for testing new features or applications without risking real assets.
Token
A digital asset issued on a blockchain, often representing value or rights within a specific ecosystem.
Tokenization
The process of representing a physical or digital asset as a blockchain-based token.
TPS (Transactions Per Second)
The number of transactions a blockchain can process in one second, a measure of speed and efficiency.
Trading Pair
A market where two cryptocurrencies are traded directly, such as BTC/ETH.
Trustless
A system where participants don’t need to trust each other, as it relies on cryptographic proof.
Utility Token
A token that provides access to a product or service within a blockchain-based ecosystem.
Validator
A participant in PoS blockchains who verifies transactions and earns rewards for doing so.
Volatility
A measure of how much the price of an asset fluctuates over time. Cryptocurrencies are generally known for high volatility.
Wallet
A software or hardware tool for storing private keys and managing cryptocurrency holdings.
Web3
The next phase of the internet that includes decentralized applications (dApps) and services running on blockchain technology.
Whale
An individual or organization holding a large amount of cryptocurrency, capable of influencing market prices.
White Paper
A document outlining the features, goals, and technical details of a blockchain project
Wrapped Bitcoin (WBTC)
A tokenized version of Bitcoin on the Ethereum network, allowing BTC to be used in Ethereum-based dApps.
XRP
The cryptocurrency native to the Ripple network, designed for quick and low-cost international payments.
Yield Farming
A DeFi process where users earn rewards by lending or staking their cryptocurrency.
Zero-Knowledge Proof
A cryptographic technique allowing one party to prove they know something without revealing the information itself.
Zk-SNARKs
A type of zero-knowledge proof used to enhance privacy by verifying transactions without revealing specific data.