Crypto Glossary

Address (Wallet Address) 

A unique identifier used to transact upon a blockchain network. Wallet addresses are represented by alphanumeric characters, which could also be represented as a scannable QR Code.

Airdrop

A distribution method in which tokens are sent to various wallet addresses. Airdrops are usually utilized as a marketing tactic to stimulate engagement, and performance, of the respective token and underlying organization/platform. 

Altcoin

Short for Alternative Coin; any digital coin/token that is not Bitcoin. 

AML (Anti-Money Laundering)

Set of international regulatory standards applied to restrict organizational & individual money laundering activities.   

API (Application Programming Interface) 

An agreed upon set of computing interfaces that defines interactions between multiple software intermediaries. For example, how requests should be created, utilized, and formatted. 

ATH (All-Time-High)

ATH stands for “All-Time-High” and refers to the highest trading price of a certain equity, stock, cryptocurrency, etc.

Bag Holder 

This is someone you don’t want to be. It refers to someone who tried to sell at a higher price but the market moved too fast and they got left with a coin that is now a significantly lower value than they paid for it.

Bitcoin (BTC)

Created in 2009 by the pseudonymous Satoshi Nakamoto. Bitcoin is the first cryptocurrency to implement Proof of Work blockchain consensus. 

Blockchain

An immutable digital ledger containing cryptographically linked (mathematically-provable) data structures containing all sorts of information. Each block contains the reference (known as a hash) to the previous block. This process forms a chain of blocks by working backwards from the most recent block to the oldest, thus giving rise to ordering sequence (time). 

Block Height 

The amount of blocks connected within a blockchain. The very first block in any blockchain is referred to as the Genesis Block. 

Block Reward

An award issued to a miner after they mine a block on that crypto network. Rewards vary from network to network, but generally consist of a combination of respective coins and transaction fees.

Bounty / Bug Bounty

A task that is offered to the community in exchange for a reward upon completion.  Bug Bounties could be to audit a project’s smart contract, create marketable content, market research, etc. 

Coin

A digital asset that is created by an independent blockchain. 

Cold Wallet/Cold Storage

A type of wallet that stores digital assets offline. (e.g. hardware wallets, paper wallets).

Confirmation/Block Confirmation

A network verification of a blockchain transaction.  Varying on the type of blockchain, the more confirmations a transaction has, the less susceptible it is to being reversed or double spent. 

Consensus 

A process that often utilizes a trustless voting process to ensure proposed data (blocks) are adhering to distributed ledger (or blockchain) network rules for inclusion.

Cryptocurrency 

Digital money that is heavily influenced by mathematical models, and further secured using encryption techniques 

DAO (Decentralized Autonomous Organization) 

A decentralized organization that operates via the autonomous (self-governing) execution of smart contracts. 

Decentralization

The elimination of dependence from a centralized authority. 

Decentralized Application (dapp) 

A peer-to-peer (P2P) decentralized network application that operates on open-sourced code.  

Decentralized Finance (DeFi) 

A new sector rendering financial services in a decentralized manner via blockchain network. With the emergence of DeFi, we’re experiencing a shift from centralized financial systems to open-sourced, interoperable, decentralized services. 

Digital Asset

An asset that is created digitally with set parameters revolving around scarcity, transferability, and exchangeability attributes – all of which assist in establishing market value. 

Digital Signature

A mathematical scheme for verifying the authenticity of digital messages. In a blockchain, digital signatures over transaction data are generated by the sender. The recipient of a transaction utilizes the digital signature along with the sender’s public key to verify sender authenticity.  

Distributed Ledger 

The dispersing of data across a blockchain network that is verified by nodes. Distributed ledgers may be: (1) permissioned, (2) permission-less, (3) centralized, or (4) decentralized. 

Difficulty 

A parameter (value) used to maintain an average time between creation of blocks. If the time between the created block is too fast, difficulty is increased to slow creation time, whereas if the time between has become too large, difficulty is decreased.

Double Spend 

A malicious act in replicating a previously executed transaction. 

DYOR (Do Your Own Research)

Our number one rule, Do Your Own Research! In crypto, as in anything, don’t just take someone’s word for something. This should be true of every decision in life, but especially those involving spending money.

Encryption 

A process of encoding information in a way that cannot be easily deciphered without the aid of a decryption method (e.g. key, algorithm).

Ether (ETH) 

The native coin used by the Ethereum ecosystem. 

Ethereum 

A decentralized software platform that allows developers to build decentralized applications and utilize smart contracts. 

Exchange

A platform that allows for the trading of cryptocurrencies. Centralized exchanges (CEX) are operated by a central authority, while Decentralized exchanges (DEX) do not have a central authority. 

Fiat Currency 

Government-issued, paperback currency that is backed by the faith in a country’s government. 

FOMO (Fear of Missing Out)

This overwhelming sensation isn’t confined to the world of cryptocurrency. It means “Fear Of Missing Out” and it’s that anxious feeling you get when it looks like the price of something is going through the roof and you think you should jump on it.

Fork

A change in protocol that induces the creation of another chain. There are two kinds of forks: (1) Soft Forks, where two chains remain compatible to some extent, and (2) Hard Forks, which is a permanent separation from the original chain – creating two individually operating blockchain networks.

FUD (Fear, Uncertainty, Doubt)

This term has been around forever and still means “Fear, Uncertainty, and Doubt”. In crypto, FUD refers to someone spreading negativity in order to cause the price of something to drop. A FUDster.

Gas 

A unit of measurement used to calculate the amount of computational resources needed to facilitate a particular transaction on the Ethereum network. Gas is denominated in minuscule units of ETH( Ethereum’s native coin) known as Gwei.

Genesis Block

The very first block in a blockchain network that is hard-coded into the blockchain code.

Gwei

A small denomination of ETH. 1 ETH = 1,000,000,000 Gwei.

Hash 

Output data that is the result of using a hash function. With regards to blockchain, the output data is the result of using a deterministic hash function; a function that ensures the same input data will always result in the same output data. 

Halving

Satoshi Nakamoto created Bitcoin with a finite supply of 21 million Bitcoin – making it a scarce commodity. Roughly every 4 years (210,000 blocks * 10 minute average creation time = 4 years), Bitcoin undergoes a process called the halving where the reward rate for mining a block is reduced by half (50%)

Hardware Wallet 

A physical wallet that can be used as cold storage (where digital assets are stored offline) or connected to the internet to interact with compatible interfaces and exchanges. 

HODL (Hold On for Dear Life)

This started out as a misspelling of the word “hold”. People thought it meant “Hold On for Dear Life”, but it simply means holding on to your cryptocurrency when prices are highly volatile.

Hot Wallet 

A wallet that is connected to the internet. 

Hybrid Consensus Model

A consensus model that combines the use of multiple consensus algorithms, such as Proof-of-Stake, Proof-of-Work, Proof-of-Elapsed-Time, etc. For example, blocks could be validated by miners (Proof of Work) and validators (Proof of Stake).

Immutability 

An inherent element of blockchains in which transactions, and their underlying data, cannot be altered due to consensus.

Initial Coin Offering (ICO) 

A crowdfunding strategy used to assist startup projects to acquire capital in exchange for tokens. 

InterPlanetary File System (IPFS) 

A decentralized file storage and referencing system for the Ethereum blockchain

Know Your Customer (KYC) 

A regulatory standard in which businesses must verify the identity of their customers. 

Lambo Wealth 

When your little nest egg of Bitcoin or other cryptocurrency reaches a value high enough to buy yourself a Lamborghini, you’ve reached Lambo wealth.

Liquidity 

The availability of liquid assets to a market or company. 

Liquidity Mining

An incentive mechanism that rewards liquidity providers with a protocol’s governance token along with trading fees associated with the particular decentralized exchange. 

Mainnet

The chief network where real transactions and consequences take place. 

Market Cap (Market Capitalization) 

A reflection of a protocol’s/network’s existing supply (in financial terms this could be relative to outstanding shares) times (multiplied by) market price (share price). 

Mining

The verification process in which blocks are added to a blockchain. The transaction (block) data is added to the public ledger, and each 1 MB group of transactions is called a block. Blocks build on one another to form the blockchain network.

MultiSig (Multiple Signature) 

A wallet that requires multiple digital signatures in order to attain access. 

Node

A device that participates in network maintenance while abiding by a network’s protocol.  

Non-Fungible Token (NFT)

A token with an inherent quality that cannot be exchanged for another token 

Oracle 

An entity that acts as an aggregator of outside data to further communicate with a smart contract or network.  

Peer-to-Peer (P2P) 

The interaction between two parties without the reliance of an intermediary. 

Private Blockchain

A blockchain that requires permission from a centralized party to grant access. 

Private Key 

A secret number assigned to an account as proof of ownership. 

Proof of Stake (PoS)

A consensus mechanism in which validators stake a certain amount of network tokens/coins in order to participate in the block validation process. 

Proof of Work (PoW)

A consensus mechanism that requires miners to solve a numerical problem in exchange for a block reward. 

Protocol 

Regulatory guidelines set to manage the transmission and exchange of data on a particular network. 

Public Blockchain 

A globally accessible network in which anyone can participate in initiating & executing transactions. 

Public Key 

An address that can be shared and used publicly to verify a digital signature. 

Relayer 

An intermediary that assists traders with executing transactions. 

Satoshi Nakamoto

The pseudonymous individual (or group) who assisted in the creation of the Bitcoin core protocol. And a satoshi is the smallest fraction of a bitcoin, worth one hundred millionths of a Bitcoin.

Scalability 

A measurement that gauges a protocol’s ability to increase (or decrease) performance relative to costs and market demand. 

Shard 

The splitting of the entire Ethreum network (ETH2.0) where each section (shard) will operate as its own independent state.  

Shill

Every industry has shills. In the crypto world, this is someone who promotes an altcoin so they can personally benefit.

Slashing Condition 

The event in which a validator’s stake is destroyed for violating protocol. 

Smart Contracts 

A program that automatically executes certain actions based on predetermined triggers on Ethereum.  

Solidity 

Programming language that is used to build applications and write smart contracts on Ethereum. 

Stablecoin 

A cryptocurrency that is pegged to a stable asset (e.g. U.S. Dollar). 

Testnet 

A simulation environment used to test the behavior of a developing application on the Ethereum network. 

Token

A representative asset that is built atop an existing blockchain. 

Transaction Fee

A fee charged to execute a transaction on a blockchain network. 

Turing Complete 

A system, or machine, that can operate & compute on-par to a programmable computer.  

Validator

An active participant in a network’s Proof of Stake consensus. The individual must stake (delegate) a certain amount of coin/tokens to verify transactions. If a validator violates protocol, it can incur a substantial financial penalty through the staked tokens. 

Wallet 

An appointed storage device for cryptocurrencies that offers public keys for sending and receiving supported funds. A crypto wallet holds the transaction records of your buys and sells. It can be a hard wallet (an actual device like a USB stick); or a soft wallet which can be stored on your desktop computer, on your mobile device, or online in the cloud. A paper wallet is simply a printout of your public and private keys.

Web3

The next evolutionary stage of the internet where value transfer could be sent directly peer-to-peer without the need for an intermediary and in decentralized fashion. 

Whale

Whales own so much Bitcoin that their buy/sell activity has the power to move the market. Picture a whale swimming through a school of fish.

51% Attack 

The event in which a single entity is able to obtain control of the majority of a network’s hash rate.