Crypto Glossary

Free distribution of tokens to wallet addresses, usually as a marketing strategy or to reward early users of a protocol.

A set of rules or instructions that a computer follows. Blockchain consensus mechanisms are types of algorithms.

Any cryptocurrency other than Bitcoin. Ethereum, Solana, and XRP are all altcoins. Derived from "alternative coin."

A type of decentralised exchange that uses mathematical formulas and liquidity pools instead of a traditional order book to price assets and facilitate trades.

The annualised rate of return on a crypto investment, including compound interest. Used in DeFi lending and staking to express yields.

The highest price ever recorded for a cryptocurrency. Bitcoin's ATH was approximately $108,000 in December 2024.

The lowest price ever recorded for a cryptocurrency.

A prolonged period of declining prices — typically a drop of 20% or more from recent highs. In crypto, bear markets often involve 80%+ drawdowns and can last 1–3 years.

The first and largest cryptocurrency by market cap. Created by the pseudonymous Satoshi Nakamoto in 2009. Has a fixed supply of 21 million coins.

A group of verified transactions bundled together and added to the blockchain. Each block contains a reference to the previous block, forming the chain.

A distributed, immutable digital ledger that records all transactions across a network of computers. The foundation of all cryptocurrencies.

A protocol that allows tokens to be transferred between different blockchain networks. E.g., moving ETH from Ethereum to Polygon.

A period of rising prices and positive market sentiment. Crypto bull markets are characterised by rapid price appreciation, media attention, and retail investor participation.

Deliberate misspelling of "build." A call to action to focus on building real products and infrastructure rather than just speculating on prices.

A traditional cryptocurrency exchange run by a company that holds user funds in custody. Examples: Binance, CoinDCX, Coinbase, Kraken.

A hardware or paper wallet that keeps private keys offline, protecting them from online hacks. Examples: Ledger, Trezor.

The method by which a blockchain network agrees on the state of the ledger. The two main types are Proof of Work (PoW) and Proof of Stake (PoS).

Short for cryptocurrency. Digital or virtual currency secured by cryptography, existing on a blockchain network.

Mathematical techniques used to secure information. In crypto, cryptography secures transactions, controls coin creation, and verifies asset ownership.

An organisation governed by smart contracts and token holders rather than executives. Members vote on proposals using governance tokens.

An application that runs on a blockchain rather than centralised servers. Smart contracts power the backend. Examples: Uniswap, OpenSea, Aave.

Financial services (lending, trading, earning yield) that run on blockchains without banks or intermediaries, controlled by smart contracts.

A peer-to-peer crypto exchange operating via smart contracts with no central authority. Users retain control of their funds. Examples: Uniswap, Curve, dYdX.

Slang for holding a cryptocurrency through extreme volatility without selling. The opposite of "paper hands."

A rapid sell-off of a cryptocurrency, causing the price to fall sharply. Often used in "pump and dump" schemes.

The second-largest cryptocurrency. A programmable blockchain that introduced smart contracts. The foundation of DeFi, NFTs, and most Web3 applications.

The runtime environment that executes smart contracts on Ethereum. Many blockchains (Polygon, Avalanche) are EVM-compatible, allowing Ethereum code to run on them.

A market sentiment indicator scored 0–100. Low scores (Fear) suggest a buying opportunity; high scores (Greed) suggest overheating. Used by traders as a contrarian indicator.

Government-issued currency not backed by a physical commodity. USD, EUR, INR are all fiat currencies. The term distinguishes traditional money from cryptocurrency.

The anxiety of missing a profitable investment opportunity. One of the primary drivers of speculative buying at market tops.

Negative information, often inaccurate or misleading, spread to manipulate the price of an asset downward. Can be genuine concern or deliberate manipulation.

Interchangeable. One unit is identical and equal in value to another. Bitcoin is fungible: 1 BTC = 1 BTC. Contrast with NFTs (non-fungible).

The fee paid to miners or validators to process a transaction on a blockchain. Ethereum gas fees are denominated in Gwei and fluctuate based on network congestion.

The very first block ever mined on a blockchain. Bitcoin's genesis block was mined by Satoshi Nakamoto on January 3, 2009.

A cryptocurrency that gives holders voting rights over a protocol's development and decisions. Examples: UNI (Uniswap), AAVE, MKR (MakerDAO).

A denomination of Ethereum (ETH). 1 ETH = 1,000,000,000 Gwei. Gas fees on Ethereum are denominated in Gwei.

An event where the Bitcoin block reward for miners is cut in half, reducing the rate of new Bitcoin creation. Occurs every ~4 years (every 210,000 blocks). The most recent halving was April 2024.

A fixed-length string of characters generated by a cryptographic function. Each block on a blockchain has a unique hash. Changing any data in the block changes its hash entirely.

The total computational power being used to mine and process transactions on a Proof-of-Work blockchain. Higher hash rate = more secure network.

A famous typo of "hold" from a 2013 Bitcoin forum post. Now stands for "Hold On for Dear Life." Refers to the strategy of holding crypto regardless of price swings.

A software wallet connected to the internet. Convenient for daily use but more vulnerable to hacks than cold (hardware) wallets.

A fundraising method where a new crypto project sells tokens to investors before launch. Similar to an IPO for stocks. Many 2017-era ICOs were scams.

The temporary loss of value experienced by liquidity providers on DEXs when the prices of pooled assets diverge. It becomes "permanent" when you withdraw liquidity.

Identity verification required by regulated financial services. Crypto exchanges in India require PAN card, Aadhaar, and a selfie for KYC compliance.

The base blockchain itself. Bitcoin, Ethereum, Solana, and Avalanche are all Layer 1 blockchains. They handle security and consensus independently.

A secondary network built on top of a Layer 1 blockchain to improve speed and reduce costs. Examples: Polygon, Arbitrum, Optimism (on Ethereum); Lightning Network (on Bitcoin).

The ease with which an asset can be bought or sold without affecting its price. Bitcoin and Ethereum have high liquidity; small altcoins often have low liquidity.

A collection of tokens locked in a smart contract used by DEXs to facilitate trades. Liquidity providers earn a share of trading fees proportional to their contribution.

Total market capitalisation. Calculated as: Current Price × Circulating Supply. Used to rank cryptocurrencies by size. Bitcoin's market cap is over $1 trillion.

The "waiting room" of unconfirmed transactions on a blockchain. Transactions with higher fees are prioritised by miners/validators.

A cryptocurrency based on internet culture or jokes. Dogecoin and Shiba Inu are the original memecoins. Extremely speculative with high pump-and-dump risk.

A persistent virtual world where users interact via avatars. Crypto and NFTs enable ownership of virtual land and items. Examples: Decentraland, The Sandbox.

The process of validating transactions and creating new blocks on a Proof-of-Work blockchain. Miners use computational power to solve mathematical puzzles and earn block rewards.

Slang for a dramatic price increase. "When moon?" is community shorthand for asking when a coin's price will rise significantly.

A unique digital token on a blockchain representing ownership of a specific item — art, music, gaming items, tickets, etc. No two NFTs are identical.

A computer participating in a blockchain network by maintaining a copy of the ledger and validating transactions. The more nodes, the more decentralised and secure the network.

Crypto slang used to describe someone making poor investment decisions. The opposite of WAGMI.

Selling a cryptocurrency at the first sign of trouble or at a loss due to fear. The opposite of diamond hands.

A secret cryptographic key that proves ownership of a wallet and authorises transactions. Never share your private key. Losing it means losing access to your funds permanently.

A consensus mechanism where validators lock up (stake) their crypto as collateral to earn the right to validate transactions. Used by Ethereum (post-Merge), Solana, Cardano. Far more energy-efficient than PoW.

A consensus mechanism where miners compete using computational power to solve mathematical puzzles, earning the right to add the next block. Used by Bitcoin. Energy-intensive but battle-tested.

Your blockchain address — the public identifier you share to receive funds. Derived from your private key. Safe to share publicly.

A fraudulent scheme where a group artificially inflates a coin's price (pump) through coordinated buying and hype, then sells their holdings at peak prices (dump), crashing the price.

Slang for suffering a major financial loss in crypto trading. Derived from "wrecked." "I got rekt when Bitcoin dropped 40%."

A crypto scam where developers abandon a project and abscond with investor funds. Common in DeFi where anonymous teams deploy token contracts and drain liquidity pools.

The smallest unit of Bitcoin: 0.00000001 BTC (one hundred-millionth of a Bitcoin). Named after Bitcoin's creator, Satoshi Nakamoto.

A 12 or 24-word recovery phrase that backs up your entire crypto wallet. Anyone with your seed phrase controls your funds. Never share it or store it digitally.

Informal term for a low-quality cryptocurrency with no real utility, poor fundamentals, or that exists primarily for speculation.

Self-executing code on a blockchain that automatically enforces predefined rules and agreements. The foundation of DeFi, NFTs, and Web3. Written in languages like Solidity.

A cryptocurrency pegged to a stable asset, usually the US dollar. Examples: USDT (Tether), USDC (Circle), DAI (MakerDAO). Used in DeFi and as a safe-haven during volatility.

Locking up cryptocurrency to support a Proof-of-Stake blockchain's operations and earn rewards. Like earning interest on savings, but with the asset's price risk.

India's 1% tax deducted on every crypto transaction above ₹10,000 by the exchange. Introduced in 2022. Applied on the seller's side.

A digital asset built on an existing blockchain (rather than having its own). Most DeFi assets and NFTs are tokens on Ethereum, Solana, or BNB Chain.

The economics of a cryptocurrency: total supply, distribution, inflation rate, vesting schedules, and use cases. Good tokenomics create sustainable demand for a token.

The total value of assets deposited in a DeFi protocol. A key metric of DeFi's size and growth. Calculated in USD across all protocols.

A node in a Proof-of-Stake network that verifies transactions and earns rewards. Must stake cryptocurrency as collateral, which can be "slashed" for dishonest behaviour.

The degree of price fluctuation. Crypto is highly volatile — Bitcoin can swing 10%+ in a single day. Higher volatility means higher potential returns AND higher risk.

A rallying cry of optimism in the crypto community. Often used ironically or genuinely depending on market conditions.

Software or hardware that stores your private keys and allows you to send, receive, and manage cryptocurrency. Wallets don't store crypto — the blockchain does.

The vision of a decentralised internet built on blockchains where users own their data and digital assets. Contrasts with Web2 (centralised platforms like Facebook and Google).

An entity holding a very large amount of cryptocurrency. Whale movements — large buy or sell transactions — can significantly impact market prices, especially for smaller coins.

A technical document describing a cryptocurrency's purpose, technology, and economics. Bitcoin's whitepaper, written by Satoshi Nakamoto in 2008, is 9 pages long.

The practice of moving crypto assets between DeFi protocols to maximise returns. Can offer high APYs but involves smart contract risk, liquidation risk, and impermanent loss.