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Altcoin is the general term used for cryptocurrencies other than Bitcoin. Previously, most Altcoins were made as upgraded versions of Bitcoin. As the market goes, Altcoins are now known as Utility Tokens, representing their projects and having various use cases in the project’s ecosystem.
For instance: LINK is used to pay Node Operators, BNB is used to pay transaction fees on Binance exchange, etc.
AMA stands for Ask Me Anything, which is an online event to resolve questions from the community. AMAs can be conducted as live streams or group calls on platforms such as YouTube, Facebook, Telegram, etc.
Many projects use AMA as a way to reach out and communicate with their supporters, raising brand awareness and giving updates on their products.
Airdrop is an event where users are rewarded with free tokens from the project. Some of the common forms of airdrop are retroactive rewards, holding and staking rewards, event rewards, etc.
Airdrop is usually used for marketing campaigns or introducing projects’ ICO to draw more users into the community.
Learn more: What is retroactive airdrop?
ASIC stands for Application-Specific Integrated Circuit, a specialized integrated circuit manufactured to serve a specific purpose. For example, the Bitcoin ASIC miner has the highest efficiency, since all its resources are gathered for only one purpose: mining Bitcoin.
ATH stands for All Time High, the highest point regarding price or market capitalization of a coin/token, a share, etc. throughout its history.
For instance, the ATH price of Bitcoin in 2021 was $64,000.
Aggregator is a platform that gathers multiple features, for example, trading, lending, etc.
Algorithmic Stablecoin is a new stablecoin model, keeping the $1 price based on algorithms instead of backed assets.
An example of algorithmic stablecoin was UST, whose price was kept at $1 by adjusting the supply and demand of LUNA.
BAGHOLDERS are investors who keep a large amount of coins, waiting to sell when the price surges in the future.
Bottom fishing is defined as investors buying at a price that they believe is the lowest, in hopes of making great profits when the price increases.
Blockchain is a hierarchical database that stores information in blocks that are linked together with encryption and expand over time.
Specifically, blockchain is an electronic ledger distributed on many different computers, storing all transaction information, and ensuring the information cannot be changed in any way. All information stored on that ledger will be verified by a series of computers connected in a mutual network. Nothing will be able to change, overwrite or delete the data in that ledger.
Bull Market - Bullish
Bull market or Bullish refers to an uptrend market, with prices increasing more rapidly than the average historical rate. The prices increase over a long period of time with large trading volumes.
In a bull market, the buy demand is higher than the sell demand.
Bear market - Bearish
In contrast with Bull market, Bear market or Bearish refers to a downtrend market, in which the prices of coins/tokens decrease sharply and consistently over a long period of time.
In a bear market, the sell demand is higher than the buy demand.
Learn more: Differences between Bear and Bull market
Binary Options is a type of Options in which users predict the candle price in a short period of time and profit if they win, or lose money otherwise.
Breakout is a term used in technical analysis, describing the price breaking its support or resistance level.
The technical indicators used to determine the breakout point may be moving averages, trend lines, price patterns such as head and shoulders, candlestick patterns, etc.
As the name implies, Bridges connect blockchains with each other. As assets have different standards on each blockchain, they can not be exchanged directly without bridges.
Read more at: What is Cross-chain Bridge?
Circulating supply is the total amount in circulation of a coin in the market.
CEX stands for Centralized Exchange, an exchange managed by a third party, either an organization or an individual. All assets deposited to centralized exchange accounts are managed by that organization or individual. Some popular CEXs are Binance, Okex, Huobi, etc.
Child node is a type of node that’s extended from another type called Parent node.
Collateral asset is the asset that users deposit into projects in order to borrow money. To retrieve the collateral assets, they must pay the borrowed amount in full along with a fee (depending on the project). Collateral assets are commonly seen on Lending projects such as MakerDAO, Venus, Unit Protocol, etc.
Cross-chain is a solution that helps transferring assets from one chain to another, optimizing the connection between chains and is commonly used by multi-chain projects.
For instance, SushiSwap’s services can be used on Ethereum, Polygon, etc.
Crypto Asset Management
Crypto asset management includes buying, selling and managing digital assets to invest and gain profit regarding the overall value. This is not a new method, but managing the cryptocurrency portfolio or cryptocurrency as part of the investment portfolio has become necessary, since crypto has a higher volatility than other financial assets in general.
Cliff is a term usually seen in projects’ token release schedule section. It refers to the token lock up period, in which investors, users or any individual will not receive any token. Cliff is commonly applied for the team, advisors or investors’ shares.
For example: Team Allocation: 12-month cliff, then vesting over 12 months.
This means there will not be any token for the team in the first 12 months, then the allocation will be released gradually from month 13 to 24.
CeDeFi is the combination of Decentralized and Centralized Finance, with applications bridging DeFi and CeFi. With CeDeFi, individuals and organizations will be able to approach crypto and DeFi more easily, while complying with the provisions of the law.
Dapp stands for Decentralized Application, which are applications built on existing platforms and protocols. Dapps focus on resolving issues in different areas, and tokens are used among them.
Since Dapps are built directly on platforms, their factors such as transaction speed, TPS, scalability, stability, etc. are reliant on these platforms.
Derivatives are a financial tool in which investors are able to trade multiple products based on price without owning them. Derivatives allow investors to buy a larger asset amount than what they own by using leverage.
DeFi or Decentralized Finance include financial applications built on blockchains. Users can access any application, anywhere without the need for a third party such as banks, since users are in full control of their assets.
DYOR stands for Do Your Own Research, which means gaining information and knowledge about a certain project to consider whether an investment should be made.
DEX stands for Decentralized Exchange, an exchange without any controlling party. Transactions made on DEXs do not involve any intermediary and only happen between the selling and buying parties. Some popular DEXs are UniSwap, SushiSwap, PancakeSwap, etc.
DAO stands for Decentralized Autonomous Organization, an organization run by members based on an encrypted set of rules. The set of rules may be consensus or smart contracts.
All members have the right to vote on important decisions of DAOs. In return, they’ll get rewarded for running these DAOs.
Simply put, DAO is a group of members that cooperate based on a set of rules with a mutual purpose, and participants will be rewarded in the process.
On-chain data is the data of an asset on a blockchain, which can be the number of holding wallets, the trading volume within a certain period of time, the deposit/withdrawal status on exchanges, etc. On-chain data is used to assess the current situation of the asset and come up with predictions such as whether the price will rise or fall, demand versus supply, etc.
Discord is a communication platform similar to Telegram, where users can participate in conversation with different communities, projects, etc. Discord’s specialty is that each server can be divided into smaller groups based on topics, e.g. general channel, entertainment, developers’ channel, etc.
In crypto, a blockchain ecosystem consists of multiple products, connecting and supporting each other. Each blockchain is considered an infrastructure company aiming at building their own ecosystem.
There is no framework on how many projects should be built to form an ecosystem, but it is easy to recognize blockchain ecosystems in crypto. Some of the most popular ecosystems are Ethereum, BNB Smart Chain, Solana, Near, etc.
Ethereum 2.0 is the upgraded version of Ethereum, switching from the Proof-of-Work (POW) mechanism to Proof-of-Stake (POS) to improve its transaction speed and scalability.
Etherscan is a tool to track, search and look up transaction data on the Ethereum network. Users can find all information regarding tokens, ERC-20 addresses, transactions, etc. on Ethereum using Etherscan.
Read more at: How to use Etherscan
ERC-20 (Ethereum Requests for Comment) is one of the technologies of the Ethereum network. This is the most common standard for tokens released by smart contracts on the Ethereum blockchain.
Some token standards on Ethereum other than ERC-20 are: ERC-721, ERC-223, etc.
EMA stands for Exponential Moving Average, a chart indicator that tracks the price of an investment over time, used in technical analysis. EMAs can be seen as support and resistance of candlesticks.
Fiat is the type of currency issued by the government. Fiat has no intrinsic value, but its value is based on the country's use ability and financial strength.
The most powerful fiat currency today is the USD issued by the US Federal Reserve (FED) under the guarantee of the US Federal Government.
Fibonacci is an indicator in technical analysis, originated from a mathematical theory by Leonardo Fibonacci in the 12th century. Traders use Fibonacci to draw support and resistance lines, find entry and exit points as well as stop loss and take profit positions.
FOMO stands for Fear Of Missing Out, the fright of missing out on opportunities. This is a popular syndrome among investors and it exists in most markets, from stock, Forex to cryptocurrency.
Full Lock Duration
Full lock duration includes cliff, if any. In some cases, if there is no cliff, full lock duration is understood as vesting period.
For example: Token allocation for the project team or seed round is usually not vested immediately after TGE (Token Generation Event), but has a cliff period. “12-month cliff, then linear vesting for 24 months” means the tokens will not be released for the first 12 months, then 1 out of 24 parts of the tokens will be released monthly from month 13 to 36.
A full node has the ability to install the full copy of a blockchain and check new transactions based on the principle of consensus.
Flash loans are uncollateralized loans under one condition: the loan must be repaid to the lending platform in the same transaction. In other words, the borrower can do whatever with that loan, then pay back the borrowed amount, all of which happens in 1 transaction.
FUD stands for Fear, Uncertainty & Doubt, another type of emotional status among investors in the market, usually emerges when bad news happens. FUD usually involves investors selling off their assets.
FDV stands for Fully Diluted Valuation, calculated by the following formula:
FDV = Max Supply * Price per token
Popular price tracking sites such as CoinGecko and CoinMarketCap always state each token’s FDV in the information section.
Gas Fee is the amount of money that users pay whenever they make a transaction that’s being put into a block (selling, buying, approving, etc.) on a blockchain. Gas fee is calculated based on Gwei, the higher the Gwei, the more expensive the gas fee, but transactions will be processed more quickly in return.
Gas war is the case where multiple users increase Gwei on purpose, accepting higher fees in order for transactions to go through faster. This will affect the blockchain network, as other users will have to pay much more for transactions. Gas wars are commonly caused by bots.
Gem, or Hidden Gem, refers to highly potential projects with low token prices. They are usually low or mid cap projects and are expected to bring great returns: 5x, 10x, or even 100x the initial capital.
Hackathon is a competition for developers, where they build potential projects for blockchains. The projects will be assessed and awarded by the judges.
Some well-known hackathons include: Solana Season Hackathon by Solana, Most Valuable Builder by BNB Chain, etc.
Halving is an event where the block rewards are cut in half. Bitcoin is the first cryptocurrency applying this mechanism, and Bitcoin Halving happens approximately every 4 years.
This mechanism stimulates gold mining, increasing the rarity of the asset and the difficulty of the mining process. Not only Bitcoin, but also Litecoin and some other coins apply the Halving mechanism.
Hard cap is the maximum amount of capital that a project wants to raise through ICO, IEO, etc.
Hard fork is an event where the upgraded version of a blockchain conflicts with the original version, causing the whole blockchain system to split into two.
One of the most well known hard forks is Bitcoin Cash, forked from Bitcoin to increase the block limit to 8MB.
Hodl (a.k.a Hold On to Dear Life), or Hold, is a popular term in crypto that refers to an investor holding their cryptocurrencies without selling. Holding coins is a long-term type of investment, where investors buy coins/tokens, then store them for a long period of time, waiting for the price to increase.
People who hold are called Holders, and the opposite are called Traders.
HYIP stands for High Yield Investment Programs, which are investment programs that bring great returns. However, almost all HYIP entrusted projects are scams.
ICO stands for Initial Coin Offering, one of the most popular fundraising forms in crypto.
ICO is similar to IPO (Initial Public Offering), a form of fundraising where companies introduce their shares.
IDO stands for Initial Decentralized Exchange Offering, a form of fundraising. Instead of being conducted on centralized exchanges like Binance, IDO is conducted on decentralized platforms such as PolkaStarter, DAOMaker, Poolz, etc.
IEO stands for Initial Exchange Offering, a form of fundraising conducted as crowdfunding by selling tokens on centralized exchanges.
A popular IEO platform is Binance Launchpad with many notable projects such as Injective Protocol (INJ), Sandbox (SAND), Coin98 (C98), etc.
IFO stands for Initial Farm Offering, a form of fundraising in which investors use LP tokens gained from providing liquidity to a certain pool as tickets to join.
IPO stands for Initial Public Offering, a form of fundraising in the traditional financial market. Companies conducting IPOs raise funds by initially issuing shares and listing on stock exchanges.
Impermanent Loss refers to the value of assets decreasing when providing liquidity, compared to holding. This term gained its popularity in August, 2020, when Yield Farming started to become a trend.
KYC stands for Know Your Customer, a process that requires companies in the crypto market to verify their customers. This is for governments to control and prevent money laundering and other criminal acts happening in the crypto market.
Layers are often used to describe blockchain levels: Layer 1 is blockchain, Layer 2 is the solution for Layer 1’s limitations. Currently, Layer 2 projects are only built for Ethereum due to its disadvantages such as high transaction fee, network congestion, low scalability, etc.
Leaf node is a type of node in blockchain, which does not contain any child node.
Launchpad is a platform for projects to issue their tokens and conduct IDO fundraisings. Some popular launchpads in the market are PolkaStarter, DAO Maker, SolStarter, etc.
Leverage is used by traders when borrowing money from platforms to long or short assets. Leverage helps traders with small capital to gain better profit if the price goes in a beneficial direction: increase for long positions, or decrease for short positions. However, it entails much more risks when the price goes in the opposite direction.
Liquidity refers to the availability of liquid assets on DEXs or CEXs. High liquidity means the demand in the market is increasing, and transactions will not suffer large slippages.
Some high liquidity assets are BTC and ETH, whose prices would not be much affected by a $10,000 buy transaction. However, if the same transaction happens with a new, low liquidity token, its price would soar since there are not enough sellers.
Liquidity providers are users who supply liquid assets to DEXs such as UniSwap, UniSwap, etc. In return, they will receive transaction fees paid by users, partly or in full, along with possibilities of other incentives such as the project’s tokens. However, without careful calculations, liquidity providers may suffer impermanent loss.
Long refers to an investor borrowing assets with a certain leverage from an exchange to buy an asset, wait for the price to increase, then sell and repay the borrowed amount along with some fee.
A user has $100 and uses 10x leverage, meaning they’re borrowing $900 from the exchange to open a $1000 long position. When the price increases, they close this long position, sell and repay $900 plus the borrowing fee to the exchange, keeping the interests for themselves.
However, if the price decreases sharply, their position will be liquidated and the initial capital of $100 will be lost. This is a high profit, high risk type of trading.
Mainnet is the official version of a blockchain released after the developers have successfully completed the testnet phase.
When the mainnet is released, the coin will have its independent blockchain, its own wallet platform, etc. However, mainnet can be adjusted when there are new updates from the project team.
Margin Trading is a form of trading where a user borrows money from an exchange to increase their capital. After taking profit or being liquidated, the borrowed assets will be returned to the exchange. Margin trading includes long and short positions.
Mint, in crypto, means mining or creating new tokens. This term is often seen in projects where users deposit collaterals to mint new tokens.
Money flow is the amount of money moving in and out of different sections/niches in crypto. When the money flows into an ecosystem, the price of most tokens within it will generally increase.
Multichain refers to projects that integrate multiple blockchains. Assets on different integrated chains can be used for their services without having to be converted to any specific blockchain.
Market cap, or market capitalization, is the value of a project coin/token on the market, calculated by the formula:
Market cap = Coin price * Circulating supply
Masternodes are servers performing different functions in a system. In reality, masternodes are blockchain wallets, running online at a fixed static IP address.
Mining is generally understood as bringing new coins into supply, and miners are the ones who perform it.
MMO stands for Make Money Online, in which a person uses a mobile device or computer (usually a computer) with Internet access to perform different actions, with the purpose of earning money.
NFT stands for Non-Fungible Token, which means an irreplaceable token. For example, if 2 people have a $5 bill each, they can exchange with each other, since the bills have the same value. However, their houses can not be exchanged since they have different characteristics. In this case, the house is an example of an NFT.
NFTs are commonly used in arts and games, with different standards such as ERC-721, ERC-1155, etc.
Non-custodial is often used to describe DEXs and decentralized wallets, which means the developers only build the product, while the full control of assets belongs to their users. The opposite of DEX is CEX, where assets will be controlled by the exchange owners once users deposit onto the platform.
OTC stands for Over the Counter, a term used in the decentralized market, which means transactions made outside of the traditional exchanges. OTC can be a broker, or an entrusted OTC commercial company.
On Huobi C2C, Binance OTC or other platforms, OTC brokers can provide BTC, USDT or stock trading services with certain currencies.
Oracle is an important DeFi lego, and Oracle projects can help projects in other niches keep their data and statistics precise and up-to-date. Some popular Oracle projects include Chainlink, Band Protocol, DIA, etc.
Order-book can be understood as a place where users place their buy or sell orders, which are then listed until other users fulfill them. Some CEXs that use order-books are Binance, Okex, Huobi, Kucoin, etc.
Parent node is a node that contains extension nodes (child nodes).
Pump & Dump
Pump & Dump is a form of market manipulation, in which:
- Pump: Making efforts in trying to increase the market price.
- Dump: Trying to decrease the price to a catastrophic level by selling off a massive amount of assets on exchanges.
Pump & Dump is common in markets such as stock, forex, crypto and even gold. Even though it is considered an illegal act, the legal framework in crypto is not enough to control this situation.
Pool is commonly seen on DEXs and Lending platforms. A pool is where liquidity providers deposit assets into for other users to trade and borrow as needed. In return, liquidity providers receive trading fees and other incentives, depending on the projects.
PoA stands for Proof of Authority, a reputation-based consensus algorithm, bringing a realistic and effective solution to blockchains.
PoB stands for Proof of Burn, an alternative consensus algorithm to try and solve the energy consumption problem of PoW. Instead of using mining machines, miners need to burn or destroy tokens, allowing them to write blocks in accordance with burned tokens.
PoD stands for Proof of Developer, a mechanism developed since 2014 as a means of transport for projects and ICOs to confirm that they are actively being built by developers. PoD in crypto is often mistaken for Proof of Delivery in traditional finance.
PoS stands for Proof of Stake, a form of mining based on the number of coins held. For example, a miner who holds 5% of the coins can mine 5% of the total amount.
PoW stands for Proof of Work, a form of mining based on the computer’s capacity. The larger the capacity, the more can be mined.
Ponzi is a pyramid scheme. Ponzi works by promising high interests for investors, but in reality, taking money from the latter to pay the former. When the interests can not be fulfilled, the Ponzi project will freeze the assets, preventing investors from withdrawing.
Some well-known Ponzi projects include BitConnect, Ifan, Pincoin, etc.
QR code stands for Quick Response code, which are square-shaped codes used to encrypt website links.
Replay attack is a type of attack targeting a certain network, in which the data is blocked or transmitted slowly due to the impact of malicious applications. This leads to the continuous repetition of information throughout the system.
Root node is the highest level node in a blockchain network.
Rekt refers to a collapse or failure. In trading, Rekt refers to heavy losses.
ROI stands for Return On Investment, the percentage of profit on the total amount of money invested.
SHA stands for Secure Hash Algorithm, including 5 algorithms accepted by FIPS (Federal Information Processing Standards) used for transferring data. Simply put, it is a type of encryption that can transform A into B, but is impossible to transform B into A.
- SHA-1, bringing 160 bit long results.
- SHA-224, bringing 224 bit long results.
- SHA-256, bringing 256 bit long results.
- SHA-384, bringing 384 bit long results.
- SHA-512, bringing 512 bit long results.
Sibling node is connected to a large node called parent node.
Satoshi Nakamoto is the creator of Bitcoin. Satoshi or sat is the smallest Bitcoin unit: 1 BTC = 100,000,000 sat.
Shill is previously known as the original currency of the UK and Austria. However, in crypto, this term refers to people spreading news in order to increase a coin’s value.
Smart contract refers to the ability of creating conditions and performing agreements of a computer system, using blockchain technology.
The whole process in a smart contract is performed automatically without the influence of third parties.
Soft fork refers to software changes compatible with the original interface. It usually doesn’t require users to update the interface to the latest version.
However, updating will help eliminate limitations of the old version and increase compatibility with new applications.
Stablecoin is a coin whose value is pegged to an asset to stabilize the crypto market.
Stablecoins must be backed by the asset that it’s pegged to, such as gold (Digix Gold Tokens - GGX), a fiat currency (Tether - USDT), or other cryptocurrencies (MakerDAO - DAI).
In contrast with long, short refers to an investor borrowing assets with a certain leverage from an exchange to sell immediately, wait for the price to decrease, then buy and repay the borrowed amount along with some fee.
For example: A user has $100 and uses 10x leverage, meaning they’re borrowing $900 worth of assets from the exchange to sell for a total of $1000. When the price decreases, they close this short position, buy and repay the borrowed assets plus the borrowing fee to the exchange, keeping the interests for themselves. However, if the price increases sharply, their position will be liquidated and the initial capital of $100 will be lost. This is a high profit, high risk type of trading.
Testnet is the test version of a blockchain, used by developers to try out new features without interfering with the existing version. All coins usually have their own testnet versions for the new features.
Trader is an investor who conducts transactions in the market. Traders are also referred to as short-term investors, who buy and sell in matter of days, weeks or months, or those who margin trade.
TVL stands for Total Value Locked, a term that emerged since the DeFi trend started to form. TVL refers to the total value of assets that users deposit into DeFi projects, which oftentimes comes from DEXs and Lending platforms’ liquidity. TVL can be checked on defillama.com or defipulse.com.
Vesting is usually found in the token release schedule section of projects. Vesting means releasing the tokens gradually to investors, and they’ll receive the allocations in full by the end of the vesting period. Vesting is commonly applied to teams, advisors or investors’ allocations.
Team Allocation: 12-month cliff, then vesting over 12 months.
This means there will not be any token for the team in the first 12 months, then the allocation will be released gradually from month 13 to 24.
Vesting period is the period when tokens are gradually released to investors according to the vesting schedule.
For example: Linear vesting for 12 months meaning the investor will receive 1 out of 12 parts of the allocation every month.
Volatility is an index that measures the price volatility of a financial asset such as stock, cryptocurrency, gold, etc.
The higher the volatility index, the more susceptible the asset's value is to sudden changes (increase or decrease) in a short period of time.
Cold wallet is a wallet that manages passphrases and private keys offline, without Internet connection. Therefore, it is less prone to hacks and exploits, except for some cases when they are connected to the Internet for sending and receiving assets.
Volume, or trading volume, is the amount of assets being traded in a certain period of time. Trading volume is calculated by the sum of the amount of assets bought and assets sold in a period of time.
Whitelist is an indispensable term when an investor participates in an ICO, referred to as a list of eligible addresses that may join in buying tokens in the project’s fundraising round.
Normally, investors need to complete the KYC process to get whitelisted.
Yield farming is a niche of DeFi, where investors profit by lending or borrowing assets on DeFi protocols.
YTD stands for Year To Date, which is an indicator of the period from the first date of the year to the current date.
Permissionless blockchain is a public blockchain where users can participate in the consensus process, verifying the validity of transactions and data added to the blockchain. Participants are scattered and can operate without trust.
This glossary has summarized the most popular terms in crypto and blockchain. If there is any term you’d like to include in this list, please don’t hesitate to leave a comment below.