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Crypto Glossary

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

A

Address
A string of alphanumeric characters representing a destination for cryptocurrency payments (like a bank account number for crypto).
Example: Example: A Bitcoin address might look like: 1A1zP1eP5QGefi2DMPTfTL5SLmv7DivfNa
Air Gap
A security measure where a computer or device is physically isolated from networks for maximum protection.
Example: Example: Private keys can be stored on air-gapped computers.
Airdrop
A distribution of free cryptocurrency tokens, often for marketing or as a reward to early users.
Example: Example: Users who held Ethereum received an airdrop of a new token.
All-Time High (ATH)
The highest price ever reached by an asset.
Example: Example: Bitcoin reached an ATH of over $69,000 in 2021.
All-Time Low (ATL)
The lowest price ever reached by an asset.
Example: Example: New coins often see their ATL in the early days.
Altcoin
Any cryptocurrency other than Bitcoin.
Example: Example: Ethereum, Solana, and Cardano are altcoins.
AMM (Automated Market Maker)
A protocol that allows digital assets to be traded automatically and permissionlessly using liquidity pools, without order books.
Example: Example: Uniswap is an AMM protocol.
Anti-Money Laundering (AML)
Procedures and regulations to prevent criminal money laundering via crypto or fiat.
Example: Example: Most exchanges require ID checks for AML compliance.
Ask Price
The lowest price a seller is willing to accept for an asset.
Example: Example: The ask price for BTC/USDT might be $68,900.

B

Bear Market
A market period characterized by falling prices and pessimism.
Example: Example: The 2018 crypto bear market lasted over a year.
Bid Price
The highest price a buyer is willing to pay for an asset.
Example: Example: The bid price for ETH/USDT might be $3,000.
Bitcoin
The first decentralized cryptocurrency, created in 2009 by Satoshi Nakamoto.
Example: Example: Bitcoin is often called "digital gold".
Bitcoin Halving
An event that halves the reward for mining new Bitcoin blocks, occurring roughly every four years.
Example: Example: The most recent halving was in 2024, reducing block rewards to 3.125 BTC.
Block Explorer
An online tool for exploring and analyzing blockchain data, including transactions and addresses.
Example: Example: Blockchain.com and Etherscan are popular block explorers.
Block Reward
The coins given to miners for successfully mining a new block.
Example: Example: Bitcoin's block reward is currently 3.125 BTC (as of 2024).
Block Time
The time it takes to mine or validate a new block in a blockchain network.
Example: Example: Bitcoin's average block time is 10 minutes.
Blockchain
A distributed digital ledger that records transactions securely and immutably.
Example: Example: Most cryptocurrencies use a blockchain to maintain their network.

C

Candlestick / Candlestick Chart
A chart that displays the open, high, low, and close price for an asset over a set period. Used in technical analysis.
Example: Example: Bullish and bearish candlestick patterns are used for trading signals.
Cold Storage
The storage of private keys in any fashion that is disconnected from the internet. Used to safeguard holdings from unauthorized access and theft.
Example: Example: Hardware wallets and paper wallets are common cold storage methods.
Consensus Mechanism
A method for validating entries into a distributed database and keeping the database secure. Includes Proof of Work (PoW) and Proof of Stake (PoS).
Example: Example: Bitcoin uses PoW; Ethereum uses PoS since 2022.
Crypto Winter
A period in which crypto prices remain low for an extended period after a bear market.
Example: Example: The 2018-2019 bear market is known as a "crypto winter."
Cryptocurrency
A digital or virtual currency that uses cryptography for security and operates on a decentralized network called a blockchain.
Example: Example: Bitcoin and Ethereum are the two largest cryptocurrencies by market capitalization.
Cryptography
The science of encoding and decoding information to keep data secure. The foundation of blockchain security.
Example: Example: Public-key cryptography is used to create secure digital signatures and wallet addresses.
Cryptojacking
The unauthorized use of someone’s computer to mine cryptocurrency.
Example: Example: Websites running hidden mining scripts on visitors’ browsers.
Custodial
A wallet or service where a third party holds and manages your private keys on your behalf.
Example: Example: Centralized exchanges usually offer custodial wallets.

D

DAO (Decentralized Autonomous Organization)
An organization run by smart contracts and governed by token holders, without central leadership.
Example: Example: MakerDAO governs the DAI stablecoin.
DApp (Decentralized Application)
An application that runs on a decentralized network, often via smart contracts.
Example: Example: Uniswap is a popular DApp.
DeFi (Decentralized Finance)
An ecosystem of financial applications built on blockchain, removing intermediaries.
Example: Example: Lending, borrowing, and trading without banks.
Distributed Ledger Technology (DLT)
A digital system for recording the transaction of assets in multiple places at the same time. Blockchain is a type of DLT.
Example: Example: Hashgraph is another DLT besides blockchain.
Dump
A rapid sell-off that causes a sharp price decline.
Example: Example: A dump often follows negative news.
Dusting Attack
A tactic where hackers send tiny amounts of crypto to wallets to try to deanonymize users.
Example: Example: Dusting attacks are common with privacy coins.
DYOR (Do Your Own Research)
A common phrase encouraging investors to conduct their own analysis before buying.
Example: Example: Always DYOR before investing in any new project.

E

EMA (Exponential Moving Average)
A moving average giving greater weight to recent prices. Reacts more quickly than the SMA and is widely used in trading strategies.
Example: Example: The 9 and 21 EMA crossover is a popular trading signal.
Entry Price
The price at which a trade is executed and a position is opened.
Example: Example: If you buy BTC at $40,000, your entry price is $40,000.
ERC-20
A technical standard for tokens issued on Ethereum.
Example: Example: USDT and UNI are ERC-20 tokens.
ERC-721
A standard for non-fungible tokens (NFTs) on Ethereum.
Example: Example: CryptoPunks NFTs use ERC-721.
Ethereum
An open-source blockchain with smart contract functionality; the second-largest cryptocurrency after Bitcoin.
Example: Example: Ethereum is the foundation for most DeFi and NFT projects.
Exchange
A platform where users can buy and sell cryptocurrencies, either centralized or decentralized.
Example: Example: Binance and Coinbase are centralized; Uniswap is decentralized.
Exit Price
The price at which a trade is closed, determining the profit or loss.
Example: Example: Selling ETH at $3,200 after buying at $2,800; exit price = $3,200.
Exit Scam
When developers disappear with investors' funds, abandoning the project.
Example: Example: Some DeFi rug pulls are exit scams.

F

Fiat Currency
Government-issued currency not backed by a physical commodity, such as USD or EUR.
Example: Example: Crypto is often traded against fiat like USD or EUR.
FOMO (Fear Of Missing Out)
The anxiety of missing out on profits, often leading to impulsive trades or investments.
Example: Example: Buying a coin because it's pumping is classic FOMO.
Fork
A change to a blockchain protocol, creating two separate chains: a “soft fork” is backward-compatible; a “hard fork” creates a new blockchain.
Example: Example: Bitcoin Cash resulted from a Bitcoin hard fork in 2017.
FUD (Fear, Uncertainty, Doubt)
A strategy of spreading negative information to cause panic selling or discredit a project.
Example: Example: FUD about regulation can crash the crypto market.
Funding Rate
A periodic payment exchanged between buyers and sellers in perpetual futures contracts, designed to keep the contract price close to the spot price.
Example: Example: A positive funding rate means long traders pay short traders.
Fungible Token
A token that is interchangeable with another of the same type. Each token has equal value.
Example: Example: All BTC are fungible; 1 BTC = 1 BTC.

G

Gas
A fee paid to process transactions or execute smart contracts on blockchains like Ethereum.
Example: Example: High network activity means higher gas fees.
Genesis Block
The first block in a blockchain, also known as block 0.
Example: Example: Satoshi mined Bitcoin’s Genesis Block in 2009.
Golden Cross
A bullish chart pattern that forms when a short-term moving average crosses above a long-term moving average, usually the 50-day over the 200-day.
Example: Example: Bitcoin’s golden cross in 2021 triggered bullish sentiment.

H

Hardware Wallet
A physical device that stores private keys offline for maximum security.
Example: Example: Ledger and Trezor are hardware wallets.
Hash Rate
The speed at which a computer can complete cryptographic puzzles for blockchain mining.
Example: Example: Bitcoin’s hash rate reached record highs in 2024.
High
The maximum price reached by an asset during a particular time frame (e.g., day, hour, minute).
Example: Example: The 24h high for ETH was $2,200.
HODL
A misspelling of “hold” meaning to keep rather than sell, even during volatility. Stands for "Hold On for Dear Life."
Example: Example: HODLers keep their coins through market crashes.

I

ICO (Initial Coin Offering)
A fundraising method where new projects sell tokens to raise capital, similar to an IPO for stocks.
Example: Example: Ethereum’s 2014 ICO raised $18 million.
Impermanent Loss
A temporary loss of funds for liquidity providers caused by volatility in a trading pair’s price.
Example: Example: Providing ETH/USDT on Uniswap during big price swings causes impermanent loss.
Index
A statistical measure of changes in a portfolio of stocks or cryptocurrencies. Crypto indexes track baskets of assets.
Example: Example: The Crypto 10 Index tracks the top 10 cryptocurrencies.
Indicator
A mathematical calculation based on price or volume used to forecast market direction, e.g., RSI, MACD, EMA.
Example: Example: Many traders combine several indicators for trade signals.

J

Jager
The smallest denomination of Binance Coin (BNB), similar to a satoshi for Bitcoin. 1 BNB = 100,000,000 jager.
Example: Example: Fees can be calculated in jagers on Binance Smart Chain.

K

Key Pair
A pair of cryptographic keys: a public key (shared with others) and a private key (kept secret). Used for secure transactions and digital signatures.
Example: Example: Your crypto wallet generates a key pair upon creation.
KYC (Know Your Customer)
The process by which financial institutions verify the identity of their clients to prevent fraud, money laundering, and financing of terrorism. Mandatory on most regulated exchanges.
Example: Example: Most crypto exchanges require KYC to increase withdrawal limits.

L

Layer 2
A secondary framework or protocol built on top of a blockchain (Layer 1) to increase scalability and efficiency.
Example: Example: The Lightning Network is a Layer 2 solution for Bitcoin.
Leverage
The use of borrowed funds to increase the potential return of an investment. Increases both potential gains and risk.
Example: Example: Trading BTC with 10x leverage magnifies profits and losses by 10 times.
Liquidation
The forced closing of a leveraged position by the exchange because the margin is insufficient to cover the loss.
Example: Example: If BTC drops too much, your leveraged long position may be liquidated.
Liquidity Pool
A collection of funds locked in a smart contract for the purpose of providing liquidity for decentralized trading, lending, and more.
Example: Example: Users provide tokens to Uniswap liquidity pools and earn a share of trading fees.

M

MACD (Moving Average Convergence Divergence)
A trend-following momentum indicator that shows the relationship between two EMAs. Traders use MACD crossovers for buy/sell signals.
Example: Example: MACD line crossing above the signal line can indicate a bullish reversal.
Margin
Borrowed funds used to trade an asset. Margin trading amplifies both gains and losses.
Example: Example: Using 2x margin, you can open a $2,000 position with $1,000.
Market Cap
The total value of all a cryptocurrency's coins in circulation. Calculated as price × circulating supply.
Example: Example: Bitcoin's market cap reached over $1 trillion in 2021.
Market Maker
An entity or individual that provides liquidity by consistently quoting both buy (bid) and sell (ask) prices for a tradable asset.
Example: Example: Automated Market Makers (AMMs) like Uniswap replace traditional market makers in DeFi.
Market Order
An order to buy or sell immediately at the best available price.
Example: Example: Market orders guarantee execution but not price.
Mining
The process of validating transactions and adding them to a blockchain using computational power. Miners are rewarded with new coins and fees.
Example: Example: Bitcoin mining uses specialized ASIC hardware.

N

NFT (Non-Fungible Token)
A unique digital asset stored on a blockchain that represents ownership of digital or physical items, such as art, collectibles, or music. Not interchangeable.
Example: Example: Bored Ape Yacht Club and CryptoPunks are famous NFT collections.
Node
A computer or device that participates in a blockchain network by maintaining a copy of the blockchain and validating transactions.
Example: Example: Running a full node helps support and secure the Bitcoin network.

O

Oracle
A service that provides real-world data to smart contracts, enabling them to react to external events.
Example: Example: Chainlink delivers external price data to DeFi protocols.
Order Book
A real-time, continually updated list of buy and sell orders for a particular asset on an exchange.
Example: Example: The order book shows all open bids and asks for BTC/USDT.
OTC (Over-The-Counter)
Trading that happens directly between parties, outside of public exchanges. Often used for large trades to minimize price impact.
Example: Example: Institutions buy large amounts of BTC via OTC desks to avoid slippage.

P

Private Key
A secret alphanumeric code that allows a user to access and control their cryptocurrency holdings. Never share your private key.
Example: Example: Anyone with your private key can access your funds.
Proof of Stake (PoS)
A consensus mechanism where validators are chosen to create new blocks and validate transactions based on the amount of coins they hold and “stake.”
Example: Example: Ethereum transitioned to PoS to save energy.
Proof of Work (PoW)
A consensus mechanism where miners solve cryptographic puzzles to validate transactions and add blocks. Used by Bitcoin.
Example: Example: Bitcoin and Litecoin use PoW.

Q

QR Code
A machine-readable code (Quick Response code) used for sharing crypto wallet addresses or transaction information easily, especially for mobile payments.
Example: Example: Many crypto wallets generate QR codes for receiving payments without typing the address.
Quants
Short for "quantitative analysts"—professionals who use mathematical models and statistical techniques to analyze markets and develop trading strategies.
Example: Example: Many crypto hedge funds hire quants to design automated trading bots.

R

Relative Strength Index (RSI)
A momentum oscillator measuring the speed and change of price movements. RSI ranges from 0 to 100. Values above 70 suggest overbought conditions, below 30 indicate oversold.
Example: Example: RSI above 70 is often a signal to consider selling.
Resistance
A price level where an asset struggles to rise above. Resistance levels are used in technical analysis to identify selling opportunities.
Example: Example: Bitcoin faced resistance at $30,000 several times before breaking higher.
Reward Halving
A programmed event (like in Bitcoin) that reduces the mining reward by half, typically every few years. Used to control inflation.
Example: Example: Bitcoin's block reward halved to 3.125 BTC in April 2024.
Risk Management
The process of identifying, analyzing, and mitigating the risks involved in trading. Techniques include setting stop-loss orders, managing position size, and diversification.
Example: Example: Using only 1% of your account per trade is a risk management technique.
Rug Pull
A scam where developers withdraw all funds from a liquidity pool or smart contract and disappear, leaving investors with worthless tokens.
Example: Example: The DeFi project turned out to be a rug pull when the team drained all liquidity.

S

Scalping
A trading strategy involving rapid buying and selling to profit from small price movements. Scalpers typically make dozens or hundreds of trades per day.
Example: Example: Scalpers may use 1-minute candles to catch quick moves.
Smart Contract
Self-executing code on a blockchain that automatically enforces the rules and execution of an agreement, without intermediaries.
Example: Example: DeFi lending platforms rely on smart contracts for loans.
Stablecoin
A cryptocurrency designed to have a stable value, usually pegged to a fiat currency like the US Dollar (USD).
Example: Example: USDT, USDC, and DAI are popular stablecoins.
Stop-Loss
An order to automatically sell an asset when it falls to a certain price, limiting potential losses.
Example: Example: Placing a stop-loss at $28,000 when buying BTC at $30,000.
Support
A price level where an asset tends to find buying interest, preventing it from falling further. Support levels are used to identify potential entry points.
Example: Example: $25,000 was strong support for Bitcoin during the 2022 bear market.

T

Take Profit
An order that automatically closes a trade at a specified profit target.
Example: Example: Setting a take profit at $40,000 after buying BTC at $36,000.
Token
A digital asset created on an existing blockchain (like Ethereum), representing value, utility, or governance rights.
Example: Example: LINK and UNI are ERC-20 tokens on Ethereum.
Trading Volume
The total amount of an asset traded during a specific time period. High volume usually indicates greater liquidity and interest.
Example: Example: Bitcoin’s 24h trading volume often exceeds $30 billion.
Trailing Stop
A dynamic stop-loss order that moves with the market price, allowing profits to run while protecting against large losses.
Example: Example: If BTC rises, your trailing stop automatically moves up.
Trend
The overall direction of the market or a particular asset. Trends can be upward (bullish), downward (bearish), or sideways (range-bound).
Example: Example: Spotting the trend early can improve trading results.

U

Uniswap
A decentralized exchange protocol on Ethereum, using automated market makers (AMMs) instead of traditional order books.
Example: Example: Users swap tokens on Uniswap directly from their wallets.
Uptrend
A sustained upward movement in the price of an asset, characterized by higher highs and higher lows.
Example: Example: Bitcoin entered an uptrend in late 2020, rising from $10,000 to $60,000.

V

Volatility
A statistical measure of the dispersion of returns or price swings in an asset. High volatility means larger price movements in short periods.
Example: Example: Crypto markets are famous for their high volatility.
Volume
The amount of an asset traded in a given period. Used to gauge liquidity and strength of price moves.
Example: Example: A spike in volume can confirm a breakout or breakdown.

W

Wallet
A tool, software, or hardware device used to store, send, and receive cryptocurrencies. Can be “hot” (online) or “cold” (offline).
Example: Example: MetaMask is a popular hot wallet; Ledger is a hardware wallet.
Whale
A person or entity holding large amounts of cryptocurrency. Whales can influence prices with large buy or sell orders.
Example: Example: A Bitcoin whale transferred 10,000 BTC in one transaction.
Wick
The thin lines above and below the candle body on a candlestick chart, showing the range between the high and low prices in a given period.
Example: Example: Long wicks can signal strong rejection of a price level.

X

XRP
The native cryptocurrency of the Ripple network, designed for fast, low-cost international money transfers and settlements.
Example: Example: Major banks use XRP for cross-border payments.

Y

Yield Farming
A DeFi practice where users provide liquidity or stake assets in protocols to earn interest, fees, or new tokens as rewards.
Example: Example: Users move assets between DeFi protocols to maximize APY from yield farming.

Z

Zero-Knowledge Proof
A cryptographic technique allowing one party to prove to another that a statement is true without revealing any other information. Used for privacy in blockchains.
Example: Example: Zcash uses zero-knowledge proofs for private transactions.