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Glossary

A

Address: A string of alphanumeric characters used to receive cryptocurrencies. Each address is unique to a wallet.

Airdrop: A distribution of a cryptocurrency token or coin, usually for free, to a large number of wallet addresses.

Algorithm: A set of rules or processes to be followed in calculations or problem-solving operations, especially by a computer.

Altcoin: Any cryptocurrency other than Bitcoin. Examples include Ethereum, Litecoin, and Ripple.

AML (Anti-Money Laundering): Regulations and procedures aimed at preventing criminals from disguising illegally obtained funds as legitimate income.

Arbitrage: The simultaneous purchase and sale of an asset to profit from a difference in the price across different markets.

ASIC (Application-Specific Integrated Circuit): A type of hardware specifically designed for mining cryptocurrencies more efficiently than general-purpose computers.

Atomic Swap: A smart contract technology that enables the exchange of one cryptocurrency for another without the need for a trusted third party.

ASIC-resistant: A characteristic of some cryptocurrencies that are designed to resist the advantages of ASIC mining, promoting more equitable mining using general-purpose hardware.

B

Blockchain: A decentralised, digital ledger that records transactions across many computers so that the record cannot be altered retroactively.

Bitcoin (BTC): The first and most well-known cryptocurrency, created by an anonymous person or group of people using the pseudonym Satoshi Nakamoto.

Bear Market: A market condition characterised by declining prices.

Block: A collection of transactions that are bundled together and added to the blockchain.

Block Reward: The cryptocurrency awarded to a miner for successfully mining a block.

Bull Market: A market condition characterised by rising prices.

Bagholder: An investor who holds a large amount of a particular cryptocurrency despite its declining value.

Bitcoin ATM: A kiosk that allows individuals to purchase Bitcoin and other cryptocurrencies using cash or debit cards.

Burning: The process of permanently removing a cryptocurrency from circulation, reducing the total supply.

C

Cryptocurrency: A digital or virtual currency that uses cryptography for security and operates independently of a central bank.

Cold Storage: The practice of keeping private keys for cryptocurrency wallets offline, usually on hardware wallets or paper wallets, to protect them from hackers.

Consensus Algorithm: A process used in blockchain systems to achieve agreement on a single data value among distributed processes or systems.

Cryptography: The practice of securing information by transforming it into an unreadable format, used in cryptocurrencies to secure transactions.

Circulating Supply: The number of cryptocurrency coins or tokens that are publicly available and circulating in the market.

Coinbase: The name of a popular cryptocurrency exchange and also the first transaction in a new block that rewards the miner.

Custodial Wallet: A type of cryptocurrency wallet where a third party holds the private keys and manages the security of the assets.

Cross-chain: Interoperability between different blockchain networks, enabling transactions and communication across separate blockchains.

D

Decentralised Finance (DeFi): A financial system built on blockchain technology that operates without traditional intermediaries like banks.

Decentralised Exchange (DEX): A type of cryptocurrency exchange that operates without a central authority, allowing users to trade directly with one another.

DAO (Decentralised Autonomous Organisation): An organisation represented by rules encoded as a computer program that is transparent, controlled by organisation members and not influenced by a central government.

dApp (Decentralised Application): An application that runs on a decentralised network, typically utilising blockchain technology.

Double Spending: The risk that a digital currency can be spent twice. Blockchain technology mitigates this risk through consensus algorithms.

Difficulty: A measure of how difficult it is to mine a block in a blockchain.

Dump: Selling off a large amount of cryptocurrency, usually resulting in a sharp decline in price.

Digital Signature: A cryptographic value that is calculated from the data and a private key that can be used to verify the integrity and authenticity of data.

Dust: A tiny amount of cryptocurrency that is leftover and considered uneconomical to spend due to transaction fees.

E

Ethereum (ETH): A decentralised platform that enables smart contracts and decentralised applications (dApps) to be built and run without any downtime, fraud, control, or interference from a third party.

Exchange: A platform where users can buy, sell, and trade cryptocurrencies.

ERC-20: A technical standard used for smart contracts on the Ethereum blockchain for implementing tokens.

Escrow: A financial arrangement where a third party holds and regulates payment of the funds required for two parties involved in a given transaction.

Ether: The native cryptocurrency of the Ethereum platform, often referred to as ETH.

Emission: The process by which new cryptocurrency coins are created and put into circulation.

EIP (Ethereum Improvement Proposal): A design document providing information to the Ethereum community or describing a new feature for Ethereum or its processes.

Exchange Traded Fund (ETF): A type of investment fund that tracks the price of an underlying asset, such as Bitcoin, and is traded on traditional stock exchanges.

Fiat On-Ramp: A service or exchange that allows users to purchase cryptocurrencies with fiat money.

F

Fiat Currency: Government-issued currency that is not backed by a physical commodity like gold or silver. Examples include USD, EUR, and GBP.

Fork: A split in the blockchain network. Forks can result in a new version of the blockchain or an entirely new cryptocurrency.

FOMO (Fear Of Missing Out): The feeling of apprehension for missing out on a potentially profitable investment opportunity.

FUD (Fear, Uncertainty, and Doubt): A strategy to influence perception by spreading negative and dubious or false information.

Full Node: A node that fully enforces all the rules of the blockchain and keeps a copy of the entire blockchain.

Fungibility: The property of an asset whereby individual units are interchangeable and indistinguishable from each other.

Flippening: A potential future event where an alternative cryptocurrency (usually Ethereum) surpasses Bitcoin in terms of market capitalization.

G

Gas: A unit that measures the amount of computational effort required to execute operations on the Ethereum network.

Genesis Block: The first block in a blockchain, also known as Block 0 or Block 1.

Governance Token: A token that gives holders the right to vote on decisions that influence the core protocol of a blockchain project.

GPU (Graphics Processing Unit): A type of processor that is particularly effective at performing the calculations

required for mining cryptocurrencies.

Gwei: A denomination of Ether (ETH), which is used in gas prices on the Ethereum network. One Gwei equals 0.000000001 ETH.

Gas Limit: The maximum amount of gas that a user is willing to pay for a transaction to be executed on the Ethereum blockchain.

H

HODL: A misspelling of "hold" that has become popular in the cryptocurrency community, encouraging people to hold onto their investments rather than selling them.

Halving: An event where the reward for mining new blocks is halved, which occurs approximately every four years for Bitcoin.

Hash: A function that converts an input of letters and numbers into an encrypted output of a fixed length.

Hash Rate: The speed at which a computer is completing an operation in the Bitcoin code. It is often used as a measure of the processing power of the Bitcoin network.

Hard Fork: A radical change to the protocol of a blockchain network that makes previously invalid blocks/transactions valid (or vice-versa), requiring all nodes or users to upgrade to the latest version of the protocol software.

Hot Wallet: A cryptocurrency wallet that is connected to the internet, making it more convenient for transactions but less secure compared to cold wallets.

Hashing Power: The computational power used by a miner's hardware to solve cryptographic puzzles on the blockchain.

I

ICO (Initial Coin Offering): A fundraising method in which new projects sell their underlying crypto tokens in exchange for Bitcoin or other cryptocurrencies.

Immutable: A characteristic of blockchain technology where once data is written, it cannot be altered or deleted.

Interoperability: The ability of different blockchain systems to communicate and operate with each other.

Initial Exchange Offering (IEO): A type of fundraising where a cryptocurrency exchange acts as the intermediary, conducting the sale on behalf of the startup.

Inflation: The increase in the supply of a cryptocurrency over time, which can lead to a decrease in its value.

Interoperability: The ability of different blockchain systems to communicate and operate with each other seamlessly.

Immutable Ledger: A blockchain feature that ensures once data is recorded, it cannot be altered or deleted.

J

JOMO (Joy Of Missing Out): The opposite of FOMO (Fear Of Missing Out), it refers to the feeling of contentment with one's decisions in the cryptocurrency market.

JavaScript: A programming language commonly used in blockchain development, especially for creating smart contracts and dApps.

Joule: A unit of energy. In the context of cryptocurrency mining, it is often used to measure energy consumption.

JoinMarket: A decentralised coin mixing service that allows Bitcoin users to improve their privacy by creating CoinJoin transactions.

K

KYC (Know Your Customer): A process used by financial institutions and exchanges to verify the identity of their clients, ensuring compliance with anti-money laundering regulations.

Key Pair: A set of cryptographic keys consisting of a private key and a public key used in asymmetric encryption.

Kilobyte (KB): A unit of digital information storage equivalent to 1,024 bytes. It is often used to measure the size of transactions or blocks in a blockchain.

Key Management: The process of handling cryptographic keys in a secure manner, including their generation, exchange, storage, and use.

L

Ledger: A record-keeping system for all transactions made on a blockchain.

Liquidity: The ability to quickly buy or sell an asset without causing a significant impact on its price.

Lightning Network: A second layer technology for Bitcoin that uses micropayment channels to scale its blockchain's capability to conduct transactions more efficiently.

Lending Protocol: A DeFi platform that allows users to lend their cryptocurrency to others in exchange for interest.

Limit Order: An order to buy or sell a cryptocurrency at a specific price or better.

Liquidity Pool: A collection of funds locked in a smart contract that provides liquidity for decentralised exchanges and other DeFi protocols.

M

Market Capitalisation (Market Cap): The total value of a cryptocurrency, calculated by multiplying the current price by the total supply.

Mining: The process of using computational power to solve complex mathematical problems in order to validate transactions and add them to the blockchain.

Merkle Tree: A data structure used in blockchain technology to efficiently and securely verify the integrity of data.

Multisig (Multi-signature): A digital signature scheme which allows a group of users to sign a document. In cryptocurrency, it is used to add an additional layer of security.

Minting: The process of creating new coins or tokens and adding them to the circulating supply.

Mainnet: The primary network for a blockchain project where actual transactions take place.

Market Maker: An entity or individual that provides liquidity to a market by being willing to buy and sell at specified prices.

Mempool: A pool of unconfirmed transactions that each node in a blockchain network maintains.

N

Node: A computer that participates in the blockchain network by validating and relaying transactions.

Non-Fungible Token (NFT): A unique digital asset that represents ownership of a specific item or piece of content, often used for art, music, and collectibles.

Nonce: A number used once in cryptographic communication to ensure that old communications cannot be reused in replay attacks.

Network: A system of interconnected computers that share data and resources. In the context of blockchain, it refers to all the nodes that participate in the blockchain.

No-Coiner: A person who does not own any cryptocurrency and is often sceptical about its value and potential.

Nakamoto Consensus: The consensus mechanism used in Bitcoin that relies on Proof of Work (PoW) to validate transactions and secure the network.

O

Oracle: A service that provides external data to smart contracts on a blockchain, allowing them to interact with real-world information.

Over-the-Counter (OTC): Trading that occurs directly between two parties, outside of traditional exchanges.

Open Source: Software with source code that anyone can inspect, modify, and enhance.

Orphan Block: A valid block that is not included in the main blockchain, often because two miners produced blocks at approximately the same time.

Off-Chain: Transactions or data that are handled outside of the blockchain network to improve speed and reduce costs.

Off-Chain Governance: Decision-making processes for a blockchain that occur outside of the blockchain itself, often through forums, discussions, and voting systems.

P

Private Key: A secret code that allows access to a cryptocurrency wallet and authorises transactions.

Public Key: A cryptographic code that allows others to send cryptocurrency to a wallet.

Proof of Work (PoW): A consensus algorithm that requires participants to perform work (solve mathematical problems) to add a block to the blockchain.

Proof of Stake (PoS): A consensus algorithm where participants validate block transactions based on the number of coins they hold and are willing to "stake" as collateral.

Peer-to-Peer (P2P): A type of network where participants interact directly with each other without a central authority.

Pump and Dump: A scheme that attempts to boost the price of a cryptocurrency through false or misleading statements, in order to sell the cheaply purchased asset at a higher price.

Public Ledger: A transparent record of all transactions that have occurred on a blockchain network, accessible to anyone.

Q

QR Code: A machine-readable code used to store and share cryptocurrency addresses for easy transactions.

Quantum Computing: A type of computing that uses quantum-mechanical phenomena to perform operations on data, potentially posing a threat to current cryptographic algorithms.

Quorum: The minimum number of participants required to make the blockchain network operational or to validate transactions.

Quick Response (QR) Code: A machine-readable code used to store and share cryptocurrency addresses for easy transactions.

R

Ripple (XRP): A digital payment protocol and cryptocurrency that aims to enable fast and low-cost international money transfers.

ROI (Return on Investment): A measure of the profitability of an investment, calculated as the ratio of net profit to the initial investment cost.

RPC (Remote Procedure Call): A protocol that allows a program to request a service from a program located on another computer in a network.

Rekt: Slang term used to describe severe financial loss or poor investment decision.

Ring Signature: A type of digital signature used to increase privacy by ensuring that the transaction cannot be easily linked to any specific user.

Replay Attack: A network attack where valid data transmission is maliciously or fraudulently repeated or delayed.

Rollup: A Layer 2 scaling solution that bundles multiple transactions into a single transaction to reduce fees and increase throughput on the Ethereum blockchain.

S

Satoshi Nakamoto: The pseudonymous creator(s) of Bitcoin.

Smart Contract: A self-executing contract with the terms of the agreement directly written into code, running on a blockchain.

Stablecoin: A type of cryptocurrency designed to have a stable value, often pegged to a fiat currency like the US Dollar.

Scalability: The ability of a blockchain network to handle an increasing number of transactions.

Soft Fork: A change to the software protocol where only previously valid blocks/transactions are made invalid. Most soft forks require miners to upgrade their software.

SHA-256 (Secure Hash Algorithm 256-bit): A cryptographic hash function that generates a 256-bit signature for a text, used in Bitcoin's protocol.

Staking: The process of participating in the validation of transactions on a PoS blockchain by locking up a certain amount of cryptocurrency as collateral.

Seed Phrase: A sequence of words generated by a cryptocurrency wallet that gives access to the wallet's private keys, used for recovery purposes.

Sidechain: A separate blockchain that is attached to its parent blockchain, allowing tokens and other digital assets to be moved between them.

T

Token: A digital asset that represents a unit of value on a blockchain. Tokens can be used for various purposes, including as currency, utility, or security.

Transaction Fee: A fee paid to miners or validators for processing a transaction on the blockchain.

TPS (Transactions Per Second): A measure of how many transactions a blockchain network can process in a second.

Testnet: A separate blockchain used by developers to test and experiment without affecting the main blockchain (mainnet).

Timestamp: The time at which a transaction is recorded in a block.

Timestamping: The process of securely keeping track of the creation and modification time of a document, ensuring its integrity.

Trading Pair: A market between two types of cryptocurrency. For example, the trading pair BTC/ETH refers to the market where Bitcoin can be traded for Ethereum.

Tokenomics: The economic model of a cryptocurrency, including its distribution, supply schedule, and incentives for holders and users.

U

Uniswap: A popular decentralised exchange (DEX) built on the Ethereum blockchain that allows users to trade ERC-20 tokens without a central authority.

UTXO (Unspent Transaction Output): The amount of cryptocurrency that is left after a transaction, which can be used as input for new transactions.

Utility Token: A type of token that is intended to provide access to a product or service within a blockchain ecosystem.

Underwater: A term used to describe an investment that is currently worth less than its purchase price.

Unspent Transaction Output (UTXO): The amount of cryptocurrency that is left after a transaction, which can be used as input for new transactions.

V

Validator: A participant in a blockchain network that verifies transactions and maintains the integrity of the blockchain.

Volatility: The degree of variation in the price of an asset over time, often measured by the standard deviation of returns.

Vanity Address: A cryptocurrency address with a specific, recognisable pattern or set of characters, often created to personalise the address.

Vitalik Buterin: The creator of Ethereum.

W

Wallet: A digital tool that allows users to store, send, and receive cryptocurrencies.

Whitepaper: An authoritative report or guide that explains the theory behind a new technology or project, often used in the context of cryptocurrencies to describe the details of a new coin or token.

Whale: An individual or organisation that holds a large amount of a particular cryptocurrency.

Wrapped Bitcoin (WBTC): A token that represents Bitcoin on the Ethereum blockchain, enabling BTC to be used in Ethereum's DeFi ecosystem.

Wash Trading: A form of market manipulation where an investor simultaneously sells and buys the same financial instruments to create misleading activity in the marketplace.

X

XRP: The native cryptocurrency of the Ripple network, used for fast and low-cost international money transfers.

xPub (Extended Public Key): A master public key that can generate multiple public addresses for receiving cryptocurrencies.

XOR (Exclusive OR): A digital logic gate that outputs true or 1 only when the inputs are not alike. In cryptography, it is used for many algorithms.

Y

Yield Farming: A DeFi strategy where users provide liquidity to a protocol in exchange for rewards, often in the form of additional tokens.

YTD (Year to Date): A period starting from the beginning of the current year to the present date.

Ycash (YEC): A fork of Zcash (ZEC), focusing on increased decentralisation and fair distribution.

Z

Zero-Knowledge Proof: A cryptographic method that allows one party to prove to another that a statement is true without revealing any specific information about the statement itself.

ZK-SNARK (Zero-Knowledge Succinct Non-Interactive Argument of Knowledge): A type of zero-knowledge proof used in cryptocurrencies to ensure that transactions are valid without revealing details about the transaction.

Zilliqa (ZIL): A blockchain platform designed to scale thousands of transactions per second using sharding as a second-layer scaling solution.