Yes, many people are getting more familiar with cryptocurrency, what it is really about, and what it can be used for. However, it may be common for you to get lost with the crypto vocabulary as a newbie; for example, you may seem confused when everyone on a comment section replies with “WAGMI,” “to the moon,” and you have no idea what they mean.

Not to worry, this A-Z glossary provides you with the meaning of all industry jargon associated with cryptocurrency and Blockchain.

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Two-Factor Authentication

Two-Factor Authentication (2FA) is designed as an extra layer of security to prevent someone from accessing your trading account in a CEX or a custodial wallet.

51% attack

A blockchain network faces the risk of a 51% attack if more than half of the miners on that network are controlled by a single person or a single group of people (in a mining pool). If it happens, it puts users at risk, as transactions and blockchain information can be tampered with, removing the advantage of decentralization, which is the foundation for Blockchain and cryptocurrency.

A

Address (Wallet Address)

An Address is a string of alphanumeric characters identifying where a cryptocurrency sits on the Blockchain. The address holds information on coin ownership and other data. (See Also: public key.)

Airdrop

An airdrop is a marketing campaign to share a newly created cryptocurrency to increase its holder population. Usually, crypto assets are given away for free in exchange for completing simple social media tasks.

Algorithm

An algorithm is a set of well-defined mathematical instructions fed into a computer system to produce a specific output.

Algorithmic Stablecoin

Algorithmic stablecoins are designed to achieve price stability by balancing the circulating supply of the stablecoin. Hence, unlike other types of stablecoins, algorithmic stablecoins maintain prices during cases of excess demand or supply. Algorithmic stablecoins are usually pegged to the U.S. Dollar or other currencies/assets through specific algorithmic instructions.

All-time high (ATH)

The highest price achieved by a cryptocurrency since its existence.

All-time low (ATL)

The lowest price achieved by a cryptocurrency since its existence.

Altcoins

All cryptocurrencies that are not Bitcoin are regarded as altcoins. Since bitcoin was the first and dominant cryptocurrency, all other cryptocurrencies are considered “alternatives.”

Anonymity

Anonymity indicates that a person's identity is unknown and that their acts are not traceable. Cryptocurrencies, such as Monero and ZCash, are examples of assets that provide true anonymity using cryptography.

Anti-money laundering (AML)

Anti-Money Laundering laws are designed to prevent criminals from laundering money through cryptocurrency because of the Blockchain’s anonymity. Many CEXsare compliant with AML regulations.

API

Application Programming Interfaces (APIs) are software built by companies to enable third-party developers to build products and services on a platform with the interaction of applications, data, and devices.

Application-specific integrated circuit (ASIC)

ASICs are computer hardware with heavy computing power. Cryptocurrency miners use these supercomputers to solve cryptographic problems in record time.

Arbitrage

Arbitrage involves buying a cryptocurrency from one exchange and selling at another, provided they can quickly make profits from the price differences.

Atomic Cross-Chain Trading (Atomic Swapping)

An atomic swap involves a peer-to-peer exchange of a crypto asset between two different ecosystems without any intermediary.

Ask Me Anything (AMA)

AMA sessions are usually held in communities. CEOs or proprietors of a crypto asset use it to address questions from investors to build trust.

AMM

Automated Market Maker (AMMs) are DEXs that allow the exchange of digital assets using liquidity pools instead of buyers and sellers, facilitating permissionless and automated exchanges.

B

Bag

A large quantity of a certain cryptocurrency.

Bag holder

An investor who holds onto a large quantity of crypto assets in declining value, hoping that they become profitable.

Bear Market

A bear market occurs when the price of crypto assets has a negative price movement.

Bear Trap

A bear trap is a form of manipulation by whales. They set a bear trap by selling their assets simultaneously, manipulating the market to think there would be a huge dip. Then, many investors panic and sell their assets, further driving down the prices. As a result, the whales buy back at lower prices, the prices soar again, and they make huge profits.

Bitcoin

Bitcoin is the first-eve and most dominant cryptocurrency. It was created in 2008 by Satoshi Nakamoto as a peer-to-peer, decentralized currency that Governments don’t control.

Bitcoin ATM

Like a regular Auto Teller Machine (ATM), A Bitcoin ATM allows people to buy or sell Bitcoin with fiat currency. Some Bitcoin ATMs allow the trading of some altcoins.

Bitcoin Dominance

Bitcoin dominance refers to the percentage of the entire cryptocurrency market capitalization that Bitcoin represents.

Bitcoin Halving

Bitcoin halving is an event where the Bitcoin reward awarded to miners is halved. This helps to induce scarcity, hereby increasing Bitcoin’s value (provided the demand is maintained).

Blockchain

The Blockchain is a decentralized, public ledger containing details of all the transactions made in a particular cryptocurrency. A blockchain comprises several individual blocks chained to one another through a cryptographic signature.

Block

Each block in the Blockchain contains information (transaction made, dollar amount, date, and timestamps) of all crypto transactions made. When the block is full, a new one will be created; a new block in the Bitcoin network is created every 10 minutes on average.

Block Confirmation

When a transaction creates a new block of information to the Blockchain, some other transactions are added to the block. The amount of transactions added chronologically to a particular block refers to its number of confirmations. The higher the amount of confirmations, the more costly it is to reverse.

Block Explorer

A block explorer is an online tool for exploring the Blockchain of an ecosystem. Since it is a public ledger, anyone can access it and view all transactions on the Blockchain. Information gotten from block explorers can aid in Fundamental analysis of crypto assets.

Block Height

The block height of a blockchain refers to the number of blocks connected within it.

Block Reward

Block rewards are given to miners who help maintain the Blockchain by solving cryptographic problems to verify transactions on the Blockchain. The transaction verification process (mining) generates new coins, and the miner is rewarded with a portion of these. (Also see PoW consensus.)

Block Time

The Block time is how long it takes for miners to verify transactions in a block until it gets full. Different ecosystems have varying Block times.

Bloodbath

A bloodbath is a slang used to represent a Bear market. It is called a Bloodbath because assets in a downtrend are marked red.

BLS

Boneh-Lynn-Shacham, is a digital signature scheme that permits users to check if a signer is original. The BLS signature scheme (BLS01) allows simple threshold signature generation, threshold key generation, and signature aggregation (BGLS03), and it’s operation occurs in prime order group. In addition, the signature is based on a bilinear pairing and a hash function, making the scheme efficiently computable and non-degenerative.

BTFD

Acronym for “Buy The Fucking Dip.” When investors buy crypto assets after suffering a bloodbath, they are said to buy the dip. Investors do this to maximize their Returns on Investments.

Bull Market

The opposite of a Bear Market. It occurs when the prices of crypto assets have an upward price movement

Burning

Burning is done to reduce the spendable amount of tokens in any given currency. It is done to increase the value of the cryptocurrency by inducing scarcity.

Buy Wall

Whalesset up buy walls in market manipulation. A buy wall involves setting a large limit order to buy a cryptocurrency when it falls to a certain value. As a result, demand exceeds supply, and the asset price soars.

BFT

A Byzantine fault occurs when a computing system fails to recognize an error. As a result, the system repeatedly carries out a given instruction. Byzantine Fault Tolerance (BFT) in blockchain technology ensures that the network continues to operate even when a group of nodes fails or becomes malicious.

C

CAP

Short form for market capitalization

CEX

Centralized exchanges (CEX) are owned by crypto companies. They facilitate the to-and-fro exchange of crypto assets to fiat currency and also make it possible to trade a crypto asset against another. Examples are Coinbase, Binance, FTX.

Centralized Ledger

Centralized ledgers are the opposites of Blockchain’sdecentralized ledgers. Centralized ledgers are common in traditional financial institutions, where a single entity controls all financial records.

Chain Linking

Every crypto asset has its own Blockchain. So, if there is a transaction between two different currencies (e.g., swapping), Chain linking occurs. This is done to ensure that the transaction is lodged on both blockchains.

Cipher (or Cypher)

An algorithm for performing encryption and decryption in cryptography.

Circulating Supply

The circulating supply of a cryptocurrency refers to its total number of publicly tradable coins.

Cloud Mining

Cloud mining is a new cryptocurrency mining mechanism that involves using rented computer processing power from companies that host physical equipment. It is used as a substitute for expensive hardware equipment.

Close

This is the price of a currency at the end of a particular period; it could be a minute, an hour, a day, week, etc. (Also see: open)

Cold Storage/Cold Wallet

Cold storage involves the storage of cryptocurrency in hardware devices that aren’t connected to the internet or Blockchain by default. (Also see: Hot Wallet)

Composability

Composability (or software composability) refers to the ability of a software stack to combine its components in different ways.

Confirmed Transaction

A confirmed transaction is one that has been approved by validators on the network and permanently added to the Blockchain.

Consensus

If all the nodes on a network validate a transaction. Then, we can say that they have a consensus.

Consortium blockchain

A consortium blockchain is privately managed and operated. However, its ledger remains public and transparent.

Cryptocurrency

Cryptocurrencies are digital assets that are independent of Central Banks and financial institutions. With the aid of Blockchain technology, cryptocurrencies are decentralized. Cryptocurrency employs cryptography to regulate the creation and transfer of assets between two or more parties.

Cryptographic Hash Function

A cryptographic hash function helps secure the message in a transaction hash; the entire process is done on a node. First, the input is converted into an encrypted alphanumeric string, then registered in the Blockchain before producing a decrypted output. This conversion aimed at encryption is controlled by a hashing algorithm, which varies for different cryptocurrencies.

Cryptography

The process of encrypting and decrypting information on the Blockchain.

Custodial Wallet

A custodial wallet is a third-party application that manages cryptocurrency private keys for users. Hence, users needn’t remember seed phrases; a third party does that for them. This third-party (usually a centralized exchange) maintains users’ crypto assets in custody.

D

Death Cross

In technical analysis, a death cross occurs when the short-term moving average crosses the long-term moving average. It is a signal that a massive sell-off could happen. (See Also: Golden Cross)

DApp

Decentralized applications (dApps) are digital applications or programs that utilize a blockchain for data storage. dApps aren’t controlled by a single entity, but they are open-sourced, and many people can contribute to the control of dApps to gain rewards in fees or tokens.

DAO

A Decentralized Autonomous Organization (DAO) is an organization where governance is determined by holders of a native cryptocurrency. All DAO members (token holders) can vote on important matters related to the organization.

DEX

A Decentralized Exchange (DEX) is a platform that facilitates peer-to-peer transactions without an intermediary. The commands in a DEX are facilitated by smart contracts and an order book. Examples of DEXs are pancakeswap, sushiswap, Uniswap, etc.

DeFi

Decentralized Finance (DeFi) refers to all peer-to-peer financial activities and services conducted on a public blockchain.

Daily Active Addresses (DAA)

DAA on a blockchain is used to identify how many users interact with a blockchain. Therefore, this is a good metric to determine how well a crypto asset performs.

Dead Cat Bounce

This is a technical term in all financial markets. It is used to identify a slight upward trend after a long decline which turns back around and keeps declining.

Decryption

Decryption involves decoding encrypted ciphertext back into plain readable text.

Deflation

Deflation occurs when there is no more demand for a cryptocurrency, causing a devaluation of that cryptocurrency.

Degen (Degenerate)

A Degen is an investor who gambles in the crypto market by buying assets (mainly meme coins) without diligence, hoping for a massive pump.

DPoS

This refers to a consensus mechanism where all members of a network nominate a select few as delegates to validate transactions and produce new blocks. DPoS is often implemented through a voting system that allows for a specific number of validators to protect the network. Elected delegates earn the transaction fees from the validated block, which is subsequently split with users who pooled their tokens in the successful delegate's pool. Individual stake size determines voting rights and is proportional to block rewards obtained.

Derivatives

Derivatives are financial tools that derive their value from a primary underlying asset. For example, Crypto derivatives usually derive their value from a cryptocurrency like Bitcoin. Common crypto derivatives include crypto futures, options, and perpetual contracts.

Derivatives Market

A derivative market provides instruments for trading cryptocurrency derivatives.

Depth Chart

A depth chart shows the order book of a crypto asset in a graphical representation. This makes it easy to determine the point at which the market will most likely fill an order in a timely fashion. The depth chart also makes it possible to identify buy and sell walls, if any.

Deterministic Wallet

A deterministic wallet is built on a specific algorithm and seed. Hence, all keys and addresses in such a wallet are created from the seed. This makes storage easy, as the wallet doesn’t produce new keys but uses variations from the seed.

Difficulty

Difficulty refers to how intensive it is to add a new block in the Blockchain. The higher the difficulty, the more computing power, and transaction fee required. Difficulty can be calculated by dividing the number of transactions waiting to be confirmed by the total power of nodes on the network.

Directed Acyclic Graph (DAG)

This presents a unique way of data structuring, and it is increasingly adopted as a consensus tool in cryptocurrencies. Unlike a blockchain that comprises connected blocks, transactions in DAGs are recorded on top of one another in vertices and edges.

Distributed Denial of Service (DDoS) Attack

DDoS attacks are common cyber-attack tactics. These attacks are perpetrated by overloading a server or network by sending excess access requests. As a result, the server becomes unavailable for other users, and the perpetrators have sole access.

Digital Commodity/Digital Currency

Digital currencies are intangible assets that are transferred electronically. All digital currencies have a dollar value.

Digital Signature

Digital signatures are used to authenticate a transaction or electronic information. In cryptocurrency, digital signatures are codes generated by public-key encryption.

Distributed Ledger

A distributed ledger (like the Blockchain) is decentralized across multiple nodes on a network so that it can be checked and validated simultaneously by multiple parties in different locations.

DLT

Distributed Ledger Technology (DLT) is a decentralized database controlled by several people across multiple nodes on a peer-to-peer network without needing a central authority. Each node in a distributed ledger processes and validates every item, making a record of each item and reaching an agreement on its authenticity. This eliminates the need for third-party intermediaries, thereby enhancing security.

Dominance (Market Dominance)

Market dominance refers to the attribute of a single cryptocurrency (Bitcoin) to dominate the entire crypto market capitalization. (Also see: Bitcoin Dominance).

Double Spend

This is a fraudulent activity that occurs when a person is trying to send a cryptocurrency to two wallets simultaneously.

Dump/Dumping

Dumping occurs when investors sell a huge portion (or all) of their holdings, causing a downward movement in an asset’s price.

Dust

Dust is an infinitesimal amount of coins that are often leftovers from trades.

Dust Attack

A dust attack is used to unmask people’s anonymity. It is achieved by sending numerous amounts of tiny cryptocurrency units (dust) to people. Then, the attackers wait for the victim to interact with these dust tokens so that they can track their wallet and identity.

Do Your Own Research (DYOR)

This means that you shouldn’t take any information given to you as final. Instead, make more findings

E

EIP (Ethereum Improvement Proposal)

EIP refers to several proposals to introduce new features to improve the Ethereum network.

Emission

Emission refers to the rate at which new coins are minted. It is usually predetermined by an algorithm.

Encryption

Encryption seeks to hide information from theft by converting plain text into codes with the aid of a cipher.

Enterprise Ethereum Alliance (EEA)

This is an organization created for corporations, startups, and developers who collaborate to develop business solutions and blockchain adoption in the real world using the Ethereum Network.

Ethereum Request for Comments (ERC)

ERC is the Ethereum network’s official protocol for proposing improvements to the Ethereum system.

EPOS

Effective Proof of stake is a mechanism that supports stake compounding and delegation, preventing centralization in the network by reducing the possibility of stake concentration by allowing even distribution of stakes across all validators.

ERC-1155

ERC-1155 is a digital token standard that can represent both fungible (ERC-20) and non-fungible(ERC-721) assets on the Ethereum Network. The ERC-1155 standard provides improved functionality of both standards, increasing efficiency and reducing costs.

ERC-20

The ERC-20 token standard represents fungible tokens.

ERC-721

The ERC-721 token standard represents Non-fungible tokens.

Escrow

An escrow is a third-party intermediary that holds funds for a buyer and seller.

Ethereum

Ethereum is the biggest Altcoin and the second-largest cryptocurrency in the crypto world based on its market capitalization. It seeks to improve Blockchain technology by allowing developers to build dApps and write smart contracts.

Ethereum Name Service (ENS)

ENS is a look-up service that allows Ethereum users to find websites or transfer funds via simple names rather than addresses. It works similarly to the internet’s DNS system.

Ethereum Virtual Machine (EVM)

EVM is a component of the Ethereum network that manages the execution and deployment of smart contracts.

Exchange

Exchanges are platforms where cryptocurrencies can be sold and purchased for fiat money or other crypto assets. Exchanges are subdivided into Centralized and Decentralized Exchanges.

Explain Like I’m Five (ELI5)

This is a request for a person to explain complex crypto terms in a simple manner that even a five-year-old would be able to understand.

Externally Owned Accounts (EOA)

EOAs are accounts bound to a private key, which signs off on transactions; they have no coding associated with them.

F

Faucet

Faucets are websites that promise free cryptocurrency just to connect with them; most times, faucets are scams.

Fiat Currency

Fiat currencies are legal tenders of different Nations. Examples are the U.S. dollar, Great British pound, Japanese Yuan, etc.

Fiat-Pegged Cryptocurrency

Fiat-pegged crypto assets are tied to the value of a fiat currency. Examples are stablecoins like the USDT

Flippening

Flippening is a term used to describe the occurrence of a coin surpassing another coin in market capitalization.

Fear of Missing Out (FOMO)

An investor is said to FOMO into purchasing a coin without proper research because it is on the rise, and they don’t want to miss out on pumps.

Fork

Due to the open-source nature of the Blockchain, more than one improvement can be made at a time. If the miners on the network cannot reach a consensus on the update to follow, both updates run side-by-side on the Blockchain. A fork could be hard or soft.

Front running

When a transaction is front-run, it means that a transaction is created with the knowledge of another transaction about to happen; this mostly happens in Decentralized Exchanges. Simply put, a programmer who wants to front-run your transaction will create bots to search for buy orders with high slippages. Upon locating your high slippage, the bot creates several buy transactions at a lower price, increasing the price. So, once the token price has reached your upper slippage limit, the bot sells those coins to you at an inflated price.

FUD

Fear, uncertainty, and doubt (FUD) occurs when negative information about a crypto asset is shared in order to push investors to panic sell

Full Node

Full nodes are nodes on a blockchain’s network that downloads the entire history in order to fully enforce its rules.

Fundamental Analysis (F.A.)

F.A. involves all activities of an investor in examining a crypto asset’s economic and financial information to research the creators’ motives and form a market opinion. F.A. is done without reading charts.

Fungibility

Fungibility is the property of a token that makes it similar to another token in type and valuation.

Fungible Token

The value of a fungible token is similar to all other tokens on the same Smart contract.

G

Gas

Gas is a measure of the computing power required to validate a transaction on the Ethereum network. Gas is measured in gWei (a billionth of ETH). A full operation on the Ethereum blockchain costs 21,000 gas.

Gas Fee

A gas fee is the financial charge associated with the measured computational power. The fees are paid to miners who validate the transactions. On other blockchains, gas fees could be called network fees or transaction fees. Gas fees may vary based on network congestion.

Gas Limit

A gas limit on the Ethereum network is the most a user is willing to pay for their transaction to go through. If the transaction needs more gas than the set limit, it will fall through, but if it uses less gas, the system will refund the difference.

Gas Price

A gas price is the dollar amount you are willing to pay for a transaction to be validated. Higher gas prices are treated with priority by miners.

Genesis Block

This is the first block that new blocks are chained to in a blockchain.

Golden Cross

In technical analysis, a golden cross is a bullish signal observed when the short-term moving average breaks its long-term moving average. (Also see Death Cross).

Graphical Processing Unit

A Graphical Processing Unit (GPU) is traditionally used to manipulate pixels repetitively on a screen, enabling videos and pictures to show without lag. GPUs are used in cryptocurrency mining due to their ability to work with large data blocks and carry out repetitive processes.

gWei

The measure used to define the cost of gas in transactions.

H

Halving

Halving is a process where the reward for mining new blocks are divided into two. (See also: Bitcoin halving)

Hard Cap

A cryptocurrency’s hard cap is the maximum supply it can ever circulate. When a crypto asset reaches its hard cap, it is prohibited from circulating more units.

Hard Cap (ICO)

An ICO hard cap is the maximum amount that can be raised in an ICO. When the hard cap is reached, ICO sale stops.

Hard Fork

When two new versions of a blockchain (forks) are incompatible, it is called a hard fork. For a hard fork to work, all nodes on that network must upgrade to the latest protocol.

Hardware Wallet

A hardware wallet is a type of cold wallet. It is similar to a USB stick and is used to store crypto assets with safe encryption. It is widely considered the most secure way to hold cryptocurrency.

Hash

This is also referred to as a cryptographic hash function.

Hashgraph

A hashgraph is a prospective improvement on the Blockchain. It is a distributed ledger system that aims to provide decentralization, anonymity, and security with significantly increased speed than the existing Blockchain.

Hash Rate/Hash Power

This is the measure of the processing power of a node or a network. The number of hashes a computer can produce per second is its hash rate. It is measured in hashes per second (h/s)

HODL

Hold on for Dear Life (HODL) is a term used to describe an occurrence where an investor holds on to their assets, despite a dip in value. Holders usually hold assets because they believe in its long-term prospects.

Hot Wallet

Hot wallets are always connected to the internet and the Blockchain. Therefore, they are less secure than cold wallets.

Hybrid PoW/PoS

This is an advancement proposition for validation on the Blockchain. It seeks to combine the security of the PoW consensus with the energy efficiency and community governance of PoS on a single network.

Hyperledger Foundation

Hyperledger seeks to create a permissioned blockchain in contrast to other permissionless and open-source blockchains. The technology is hosted by the Linux Foundation.

I

Initial Coin Offering (ICO)

An ICO is a fundraiser done by a creator of a cryptocurrency, putting some part of the coins up for purchase at an amount perceived to be a bargain.

Initial Exchange Offering (IEO)

An IEO is a spin-off of an ICO. In this case, an exchange conducts token sales instead of the creators of the cryptocurrency.

Immutability

The property of the Blockchain to remain unchanged. No transaction can be reverted or canceled.

Impermanent Loss

This is a temporary loss of assets associated with providing liquidity in a pool caused by volatility. It is the difference in value observed from providing liquidity compared to holding the assets.

IoT

Internet of Things (IoT) is a unique system that allows machines and devices to interact with one another, sharing data without human intervention.

Interoperability

Interoperability refers to the property of blockchains to interact with each other without restrictions.

J

Joy of Missing Out (JOMO)

This refers to a scenario where an investor is happy because they refused to invest in a coin with high prospects, and eventually, the coin fails to meet expectations.

K

Know your Customer (KYC)

Centralized Exchanges and other registered financial institutions are obliged to verify the identity of all customers to help avoid money laundering.

L

LAMBO (Lamborghini)

Lambo simply refers to getting rich. The idea comes from buying a Lamborghini after making a lot of money from cryptocurrency investments.

Layer1

A layer 1 blockchain is a set of solutions that improve the fundamental protocol to make the whole system more scalable. It is referred to as the base network as it executes a transaction without the need for another network.

Ledger

A ledger is a digital record book containing a record of financial transactions and critical details.

Leverage

Leverage gives a trader an advanced method to have bigger assets for trading. As a result, it increases profit (and loss) margins.

Lightning Network

This is a layer two solution that aims to improve transaction speeds on nodes participating in transaction validation. It is cheap, scalable, and interoperable; hence, it is proposed as a solution to current blockchain problems.

Limit Order/Limit Buy/Limit Sell

A limit order instructs the system to sell or buy cryptocurrency at a specific price.

Liquidity

The liquidity of a cryptocurrency is a measure of how it can be easily traded with other crypto assets or sold for fiat money without impacting market prices.

Locktime

A locktime is used to schedule transactions by defining the earliest time or block height required to confirm a transaction on the Blockchain.

Long

“Going long” is the action taken when a person buys a currency at a lower price with the expectation that it’ll rise in value. Such person doesn’t hodl but sells when they have made enough profit.

LPoS

Leased proof-of-stake (LPoS) is a type of proof-of-stake consensus method utilized on the Waves platform that allows token holders to "lease" their tokens to full nodes and get paid little dividends from the portion of their payout. The more the amount leased to a full node, the more likely the full node will be chosen to produce the next block. As a result, the leaser will earn a share of the transaction fee paid by the full node if it produces the next block.

M

Moving Average Convergence Divergence (MACD)

This is an indicator in technical analysis that tracks the momentum of historical price changes to predict future price direction.

Mainnet

A mainnet is a completely developed blockchain platform that can execute transactions, smart contract calls, or other blockchain applications. (See also: Testnet)

Margin Call

When trading with leverage, an investor receives a margin call of their account falling below the required amount to stay afloat.

Margin Bear Position

When shorting with leverage, it’s also referred to as taking a margin bear position.

Margin Bull Position

When going long with leverage, it’s also referred to as taking a margin bull position.

Market Capitalization

The market cap of a cryptocurrency indicates its total value. This is estimated by multiplying the total number of coins in supply by the unit price. Market Cap = supply x price.

Margin Trading

Margin trading allows traders to trade using other people’s funds using leverage. This allows them to control more assets than they can afford, exponentially increasing the profit/loss possibility. However, it is a risky strategy and should be practiced with caution.

Market Order

A market order sells or buys a crypto asset at the current available price (unlike a limit order that waits for a price target.)

Market Taker

A trader who buys or sells in a market order.

Masternodes

Masternodes are quite different from regular nodes. Rather than adding new blocks to Blockchain, they are used to verify blocks, operate, and maintain the Blockchain. Masternodes are found in PoS systems.

Mempool

A mempool (Memory Pool) houses transactions waiting to be confirmed in a blockchain.

Merkle Tree (Hash Tree)

A Merkle or hash tree is used to validate and encode large data structures. It is represented by a tree with leaves (nodes); every leaf is labeled with the hash of a data block, and every branch (inner nodes) is labeled with its child nodes’ hash.

Metaverse

The Metaverse is a virtual world where humans can carry out real-life activities and fantasies in a computer-generated environment.

MicroBitcoin (uBTC)

A microbitcoin is one-millionth of a bitcoin or 0.000001 BTC.

Microtransaction

Microtransactions are systems that make it possible to make small value of digital payments, such as buying items in a game or purchasing a few pages of an e-book.

Mineable

A cryptocurrency is referred to as “mineable” when it operates with a Proof-of-Work consensus.

Miners

Miners are validators who help to create new crypto by validating transactions. They are responsible for maintaining a blockchain’s network.

Mining

Mining is the process of validating transactions on a blockchain by solving encryption challenges in exchange for crypto rewards.

Mining Contract

This is an investment that allows a miner to rent the hashing power of mining hardware for a specific time. (See also: cloud mining)

Mining Pool (Group Mining)

A mining pool consists of several miners combining their computing powers to validate transactions on the Blockchain. The rewards obtained are spread with respect to each miner’s computing power. People engage in group mining to boost their chances of validating a transaction first, thereby getting enough reward to earn a steady income.

Mining Reward

New cryptocurrency given to miners for processing transactions.

Mining Rig

A computer set up for mining crypto.

Mnemonic Phrase (Seed phrase)

This is a list of words in a specific sequence to access or restore your cryptocurrency assets. It is an encrypted version of your private key.

Money Services Business (MSB)

MSBs offer financial services. They are usually registered.

Moon

A term used to describe a continuous upward price movement, like a rocket heading to the moon.

Moving Average

In Technical Analysis, A moving average refers to the average asset price of a cryptocurrency over a specific period.

Multipool Mining

Multipool mining is the action of a miner to switch between blockchains, depending on the profitability of each blockchain network. Multipool mining pools also exist.

Multisignature

A multisignature (multi-sig) transaction requires the signature of two private keys to send a transaction. This system makes it possible to send assets as a group; it is also less susceptible to theft since two private keys must be compromised.

N

Network

A network is a collection of all nodes connected to a blockchain at any given period.

Node

A node is any computing unit connected to a blockchain’s network

Nonce (Number Only Used Once)

A nonce is a random number generated upon the hashing of a transaction. It is issued to ensure that the same transmission of information isn’t repeated.

Non-Custodial Wallet

Non-custodial wallets allow you to completely control your funds, as well as the private key. When using Non-custodial wallets, funds are not under anyone’s control. Users are entirely responsible for keeping their keys safe and accessible.

NFT

Non-Fungible Tokens (NFTs) are unique, and unlike fungible tokens, they can have a different value from another Token on the same Smart contract. This difference can be attributed to many factors, including age, rarity, or visual properties.

O

OAuth

OAuth is an API authentication and authorization method that allows users to access multiple websites and services without exposing their credentials. OAuth does not communicate authentication data between users and service providers, but it functions as an authorization token.

Off-chain

Off-chain refers to transactions that occur outside the Blockchain.

Offline Staking

Staking activities that don’t require being connected to the Blockchain

One Order Cancels the other Order (OCO)

This order type allows the placement of two simultaneous orders, whereby the acceptance of one will cancel the other.

Open

This is the price of a currency at the beginning of a particular period; it could be a minute, an hour, a day, week, etc. (Also see: close)

Open Source

Open-source software allows the general public to study, change, and redistribute its technology; open-source software have their source code available in public domains.

Option

Options are financial instruments that allow traders to buy or sell crypto at a specified price and time.

Oracles

Oracles are services that can translate real-world events, verify them, and provide this data to the Blockchain.

Order

An order is a set instruction to buy or sell cryptocurrency with given conditions.

Order Book

A list of limit orders in an exchange.

Orphan Block

An orphan block is one that has no predecessor because its parent block hasn’t been validated. Hence, it is alone on the Blockchain, unconnected. Miners don’t receive rewards for orphan blocks.

Overbought

This is a technical analysis term used to indicate a period where a large number of purchases have been made on a cryptocurrency, and a period of selling is expected for a market correction.

Oversold

This is a technical analysis term used to describe a period where a bounce is expected because the cryptocurrency has spent significant time being sold without an upward movement, and market correction is expected.

P

Paper Wallet

A paper wallet is a type of cold storage that holds and secures your private keys on a physical document.

P2E

Play-to-earn (P2E) games incorporate blockchain and NFTs into gaming structures, rewarding gamers with crypto assets tied to rea world value.

P2P

A peer-to-peer (P2P) connection, transaction, or interaction is one that involves two parties without any intermediary or third party.

Permissioned Blockchain

This is a blockchain that isn’t publicly available. Here, all nodes must be authorized by the ledger administrators.

Ponzi Scheme

A Ponzi scheme is an elaborate scam in the form of a pyramid system where early investors benefit from the money invested by later investors.

Portfolio

Your portfolio refers to all your crypto assets.

Presale

A presale is an event where a cryptocurrency team allows whitelisted investors or community members to purchase a token before the ICO goes public.

Privacy Coins

Privacy coins are designed for anonymity. They hide information about their users.

Private Key

A private key is a password used to access your wallet. It acts as a master key to restoring your wallet if missing, and it also acts as your digital signature when making transactions. Private keys are usually encrypted using mnemonic phrases.

PoA

The Proof of Authority (PoA) consensus mechanism relies on known and reputable validators to confirm transactions. These validators stake their identities; hence anonymity is inexistent in the PoA consensus. However, it is way faster than the PoW consensus.

PoB

The Proof-of-Burn (PoB) consensus mechanism requires miners to burn some of their tokens and provide a proof before getting a chance to mine a new block.

PoD

The Proof-of-Developer (PoD) consensus is an authentication mechanism aimed at verifying the legitimacy of a developer to avoid falling into fraudulent developers who are out to steal funds.

PoH

A proof-of-history blockchain mechanism is a protocol that relies on a series of computations that can be used to cryptographically validate the passage of time between two events, by absorbing time into the blockchain; hence, reducing the loads on network nodes while processing blocks.

PoS

The Proof-of-Stake (POS) consensus mechanism requires a validator to lock in a specific number of tokens on the network to be considered a validator. It is the most effective alternative to PoW consensus, as it prioritizes stake over computing power, thereby being energy efficient. For example, a validator on the Ethereum network is required to stake at least 32 ETH.

PoW

The Proof of Work (PoW) consensus is the first and most widely used consensus mechanism. It requires miners to utilize significant amounts of computing power to solve complex mathematical problems to validate transactions, thereby securing and maintaining the Blockchain and getting cryptocurrency as rewards. A miner must show “proof of work” before earning rewards.

Protocols

Protocols are rules that govern data exchange on a network.

Public Blockchain

A public blockchain is one that can be accessed by anyone with an internet connection.

Public Key

This is also called a wallet address. It is a string of random numbers and letters used to receive cryptocurrencies. It can also be used to track your actions on the public ledger (Blockchain).

Pump

A pump is used to describe steady upward movement in a cryptocurrency’s price. It could be an effect of a bull run or whales investing large amounts of money.

Pump and Dump (PND)

Pump and Dump schemes are similar to Ponzi schemes, where early investors buy a lot of one cryptocurrency to attract others to invest. Then, after there is enough profit margin, the early investors pull out their funds and drive the asset to the ground.

S

Salt

In cryptography, salt is a technique that makes hash codes challenging to reverse. It is achieved by adding a random input to a one-way function to make the password hash unique and free from compromise.

Satoshi Nakamoto

This is the pseudonymous name used to address the individual or group of individuals that created bitcoin.

Satoshis (SATS)

A Satoshi, named after “Satoshi Nakamoto,” is the smallest unit of bitcoin. One SAT is equal to a millionth BTC.

Scalability

Scalability refers to a cryptocurrency’s ability to grow and handle increasing data and transactions on a blockchain. An increasingly adopted network needs to be scalable so that transactions won’t be slow and expensive.

Scrypt

A scrypt is a memory-based encryption algorithm that requires a huge amount of RAM to hash rather than colossal computing power. This encryption makes it difficult for hackers to attack.

SDK

A software development kit (SDK) is a collection of software development tools that consist of a programming language compiler, a built-in database development environment, and an API that are packaged together in a single installable software package that allows a developer to create a customized app that can be added to or connected to another program.

Second-Layer (Layer-Two) Solutions

Layer two solutions are blockchains that run parallel to an existing blockchain to achieve faster transaction speeds, lower gas fees, and better scalability.

Secure Asset Fund for Users (SAFU)

This is a program created by Centralized Exchanges to assure users that their funds are safe even if they get hacked. The Secure Asset Fund contains reserves to reimburse users if the exchange gets hacked.

Seed Phrase

A seed phrase is also called a mnemonic phrase. It is a list of words in a specific sequence to access or restore your cryptocurrency assets.

Segregated Witness (SEGWIT)

SEGWIT is an improvement protocol that allows better blockchain efficiency without increasing block size. Instead, the protocol seeks to optimize block size to solve issues regarding scalability, transaction speed, and fees.

Selfish Mining

Selfish mining occurs when a miner or group of miners creates a new block without informing other miners on the network. As a result, other miners will keep burning their computational power on an old block. This is considered beneficial for the Blockchain since it fosters genuine decentralization.

Sell Wall

A sell wall is an occurrence where there are large sell limit orders. This will prevent a cryptocurrency from rising above a level unless there are enough buy market orders to maintain demand at the sell wall.

SHA-256

SHA means “Secure Hash Algorithm.” The SHA-256 algorithm generates a 256-bit hash. Bitcoin and other cryptocurrencies use it to encrypt data.

Sharding

Sharding is a scalability solution aimed at splitting up the Blockchain with side-chains so that each full node doesn’t need the complete blockchain copy.

Shilling

Shilling is a form of covert advertising that involves persuading other people to buy the same coin.

Shit Coin

Shitcoins are coins with no use cases and have little value; most meme coins are shitcoins.

Short

When a trader goes short, they sell an asset they don’t have (usually on a derivatives market), usually with the hope of buying the asset at a lower price for profitability in a bear market.

Sidechain

A side chain is a secondary blockchain ledger that runs parallel with a blockchain’s mainnet.

Smart Contracts

A smart contract automatically establishes the terms of an agreement when certain conditions are met. Smart contracts are self-executing computer programs that carry out commands once the defined conditions are met; they are secured using blockchain technology.

Soft Cap

A soft cap is the lower target fundraising limit of an ICO or IEO.

Soft Fork

A soft fork is a change applied to a blockchain without causing fundamental structural changes, in the sense that old nodes running the old protocol will still recognize new transactions as valid rather than disregarding them.

Software Wallet

Otherwise called a hot wallet. A software wallet is a type of wallet that is always connected to the Blockchain. A software wallet’s private keys are stored on the associated device. It could be a web wallet, desktop wallet, or mobile wallet.

Solidity

This is a new kind of programming language tool used to create smart contract codes that are executable on the EVM.

Stablecoin

Stablecoins are cryptocurrencies pegged to fiat currencies like the U.S. dollar or commodities like gold. As a result, they are involatile and stable in price.

Staking

Staking is the process of locking-in funds in a blockchain network to validate transactions. people who lock these funds are called stakers (See Also: Proof-of-Stake Consensus).

Stale Block

A stale block is one that isn’t added to the Blockchain because another block of similar height was added to the chain first. Miners don’t get rewarded for stale blocks.

Security Token Offering (STO)

An STO is similar to an ICO. However, rather than offering a coin, it offers securities in the forms of equity, shares, profits, etc.

SSO

Single sign-on is a session and user authentication service that allows users to authenticate once and access all account resources and applications linked to the SSO system. The solution gives associated access to much independent software with a single set of credentials without signing in separated on each linked account.

Stop-loss Order

A stop-loss order is aimed at minimizing possible losses after buying an asset. It sets a command to sell to automatically sell the asset if its price falls below a set limit.

R

REKT

A slang for “wrecked.” It is used to describe a terrible loss in a trade or investment.

Relative Strength Index (RSI)

This is an indicator in Technical Analysis that predicts an overbought or oversold market by judging the previous momentum of price changes. The RSI score ranges from 0 to 100. A reading higher than 70 is considered overbought, and a reading lower than 30 is considered oversold.

Replay Attack

Also called a middle man attack, a replay attack is made to intercept valid data transmission fraudulently, misleading the victim into doing the bid of the attacker.

Returns on Investment (ROI)

ROI is the percentage net profit made after investing in a crypto asset.

Ring Signature

Ring signatures are mechanisms used to foster anonymity on a blockchain. It is facilitated by allowing signatures in groups so that outsiders cannot determine who signed what transaction.

Rug Pull

Rugg pulls are scams that occur when developers remove liquidity from an asset, leading to a sudden price crash as the cryptocurrency can no longer accommodate orders.

T

Technical Analysis (T.A.)

This involves using trading tools like indicators and charts to have clear insights about a coin’s history and to use that information to forecast its future.

Test Net

A test net is a network used to experiment with new versions of a blockchain. All changes on a test net don’t affect the main net.

Third Layer (Layer-Three) Solutions

Layer-three solutions aim to achieve interoperability on the Blockchain, enabling different blockchain networks to communicate and interact seamlessly.

Timestamp

Timestamps show the exact moment a transaction was signed and validated. It provides proof that blocks on a blockchain are connected chronologically.

Token

A token is a cryptocurrency that can be bought, sold, owned, and transmitted on the Blockchain without compromising sensitive data.

Tokenless Ledger

A blockchain is said to have a tokenless ledger if it doesn’t require a native cryptocurrency to operate. Miners on these blockchains don’t get any rewards for validating transactions.

Token Generation Event (TGE)

This is an event scheduled to release new tokens into the market.

Total Supply

This is the measure of all tokens that will exist on a cryptocurrency network. For example, the Total Supply of Bitcoin is 21 million.

Total Value Locked

This is a DeFi term used to describe the total number of assets that are currently secured in a specific protocol via staking.

Trading Volume

This is the measure of all crypto transactions completed within a time frame (usually 24 hours).

Transaction

A transaction occurs when value is transferred from one wallet to another on a blockchain network. For a transaction to be valid, it must be confirmed by miners on the network.

Transaction Fee

This is a fee paid to miners on a blockchain for validating a transaction. Transaction fees can vary from time to time depending on the difficulty involved in validating a transaction, as well as network congestion at the time.

Transactions Per Second (TPS)

This is a measure of a blockchain’s speed. It is the number of transactions done per second on a blockchain.

Trustless

A trustless transaction is verifiable by all parties. It eliminates the need to trust either party in a transaction.

Turing Completeness

This is the capability of a machine to execute all possible programs or calculations.

U

Unconfirmed Transaction

A transaction is unconfirmed until it is validated by miners on the Blockchain’s network. This is done to confirm that there are no two transactions involving the same coins to avoid double-spending.

Unspent Transaction Output (UTXO)

This refers to the amount of leftover cryptocurrency returned to a user’s wallet after completing a transaction on the Blockchain.

V

Validator

A validator is a participant of a blockchain’s network that confirms transactions to maintain the Blockchain and create new blocks while earning rewards. Miners are examples of validators.

Venture Capital

These are funds (capital) invested in a crypto startup to provide investment for a potentially successful project.

Volatility

Volatility is the measure of fluctuation of a crypto asset’s price; crypto assets are generally volatile.

W

Wallet

A cryptocurrency wallet is a piece of software or hardware that uses blockchain technology to safely administer, transmit and manage cryptocurrencies.

Wash Trade

Wash trades are manipulative back and forth trades aimed at inflating the trading volume of a cryptocurrency.

Watchlist

A person’s watchlist is their personally defined list of assets they monitor to observe the activity.

Web3 Wallet

Web3 Wallets are software that allows interaction with web 3.0 dApps, and the Metaverse.

Wei

This is the smallest fraction of an ether. 1 Ether = 1,000,000,000,000,000,000 Wei.

Whale

Whales are highly wealthy investors or traders that can make enough sales or purchases to influence the market.

When Lambo?

An expression used in crypto communities to ask when they will get rich. i.e., when their investments will be enough to buy them a Lamborghini.

When Moon?

This is an expression used in crypto communities to ask when the price of a coin would hit its peak, like rockets approaching a moon.

Whitelist

This is a list of pre-approved applicants who can buy a crypto asset before it becomes publicly available.

White Paper

This is a detailed explanation of the aims and objectives of a cryptocurrency, its roadmap, team members, technical advisors, and other technical information. In essence, it is a document that explains the purpose of a cryptocurrency in order to create interest for prospects.

Y

Yield Farming

Yield farming involves staking cryptocurrency in a DeFi protocol with the expectation of rewards. It provides an alternative to simply Hodling without the extra income.

Z

Zero Confirmation Transaction

This is a term used to represent an unconfirmed transaction.

Zero-Knowledge Proof

This is a cryptographic technique used to prove the knowledge of information without revealing the information itself.

Zero-Knowledge Succinct Non-Interactive Argument of Knowledge (Zk-SNARKS)

Zk-SNARKs are protocols used to prove possession of information without revealing the information. It also involves no interaction between the proving party and the verifying party.