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Crypto Glossary

Feeling left behind by all the crypto jargon? Let's simplify the world of web3 with clear and easy-to-understand explanations. Ledger Academy helps you navigate the 'A to Z' of cryptocurrency and blockchain with simple crypto definitions. Let's demystify the meaning behind crypto terminologies together and get ready to talk web3 like a pro!

Airdrop

A crypto airdrop is a marketing campaign where a project will deliver free crypto tokens or coins to participating users’ wallets.

Algorithm

An algorithm is a set of well-defined instructions used to perform calculations, accomplish a task, or solve a problem(s). The instructions must be executed in a specific order to produce the desired outcome.

All Time High

All-Time High (ATH) refers to the highest price that a financial asset has ever reached. The term is used to analyze traditional financial assets like stocks and bonds, as well as digital assets like Bitcoin.

All-Time Low

All-time low (ATL) refers to the lowest price a digital asset has ever reached in its entire trading history.

Altcoin

Altcoins refers to any other cryptocurrency apart from Bitcoin. They are called altcoins because they are considered alternative currencies to Bitcoin.

Apeing

Apeing is crypto slang describing the practice of investing in a new project without doing due diligen

Application Layer

The application layer is the front-end layer of a blockchain, made up of programs that allow users to interact with a blockchain network.

Artificial Intelligence (A.I.)

Artificial intelligence (AI) is the simulation of human-like intelligence by machines or computer systems to accomplish tasks. It is also a computer science field that focuses on creating intelligent systems.

Ask Price

An ask price is the lowest amount at which a seller is willing to sell an asset such as a stock, bond, or cryptocurrency.

Atomic Swap

An atomic swap is a peer-to-peer trading mechanism that facilitates the exchange of digital assets across separate chains without using intermediaries. It enables users to transfer cryptocurrencies via smart contracts.

Automated Market Maker

An automated market maker defines the underlying protocol that provides liquidity to decentralized exchanges and determines asset prices.

A

Bear Market

A bear market is a lasting downward trend in the market when asset prices are declining and supply is greater than demand.

BEP-20

BEP-20 is a token standard extending Ethereum’s ERC-20 standards. It is the token standard powering the Binance Smart Chain.

Bid Price

The bid price is the highest price that a buyer is willing to pay for a particular asset, such as a cryptocurrency or stock.

Bid-Ask Spread

Bid-ask spread in crypto is the difference between the highest price a buyer is willing to pay and the lowest price a seller is willing to accept for a specific asset.

Bitcoin Core

Bitcoin Core is the software used to connect to and interact with the Bitcoin peer-to-peer network.

Bitcoin Dominance

Bitcoin dominance is the ratio between Bitcoin’s market cap and the market cap of the entire cryptocurrency market.

Bitcoin Improvement Proposal

Bitcoin Improvement Proposal (BIP) is the standard documentation format for proposing changes to the Bitcoin network.

Bitcoin Inscriptions

Bitcoin inscription is the process of embedding arbitrary data or content onto a Satoshi, the smallest denomination of Bitcoin.

Bitcoin OG

Bitcoin OG, short for “Original Gangsta” or "Original Gangster,” is slang for the earliest adopters of the cryptocurrency.

Bitcoin Stamps

Bitcoin stamps define the technique of embedding metadata within Bitcoin transaction outputs.

Block

A block in a blockchain is a container of data that records all transactions in a secure and transparent way

Block Reward

A block reward is the sum of crypto awarded to a miner or validator by a blockchain protocol for successfully mining and validating a block.

Blockchain

Blockchain is a digital ledger, capable of tracking the movement of value or information around its network. With control of this network distributed across many points, it cannot be censored.

Blockchain Bridge

A blockchain bridge connects two separate blockchain networks and enables the transfer of data and tokens between the different networks. Blockchain bridges facilitate interaction and the ability to operate between networks (commonly referred to as “interoperability”).

Blockchain Confirmation

Blockchain confirmation refers to the process of verifying a transaction and adding it to a blockchain.

Blockchain Explorer

A blockchain explorer is a tool that enables users to navigate and review information about any public blockchain network.

Bounty

A bounty is a reward offered to individuals for identifying vulnerabilities or bugs in software.

Breakout

A breakout is when an asset’s price moves below a support level or above a resistance level. Breakouts are used to identify potential trends and trading opportunities.

BUIDL

The term “BUIDL” is a call for crypto users and enthusiasts to build and contribute to the progress of the blockchain and crypto space, as opposed to passively holding digital assets.

Bull Market

A bull market is a period of sustained upward trend when asset prices are steadily increasing.

Buy The Dip (BTD)

Buying the dip refers to the practice of buying an asset when the price drops.

Buy Wall

A buy wall is the result of a large buy limit order(s) placed on a cryptocurrency when it hits a certain price. Automated trading algorithms are responsible for most buy walls.

Byzantine Generals’ Problem

The Byzantine Generals’ Problem is a game theory problem that illustrates how difficult it is for decentralized parties to arrive at a consensus or agree on a single truth without relying on a trusted third party.

B

Candidate Block

A candidate block is a container for transactions selected from the memory pool. It has the potential to be added to the blockchain or rejected by the network.

Central Bank Digital Currency (CBDC)

A Central Bank Digital Currency (CBDC) is the electronic version of a country’s fiat currency, and is issued by the central government. CBDCs are like cryptocurrencies, but their value is tied to the country’s physical currency.

Circulating Supply

A crypto’s circulating supply is that specific cryptocurrency’s amount of tokens or coins that are in circulation at a particular time and are available to the public to buy or sell.

Coin

A coin is a digital asset that functions as a currency or store of value on its own blockchain network.

Cold Storage

Cold storage is a method of holding data or crypto assets in devices that are not connected to the internet, which provides added security for its users.

Cold Wallet

A cold wallet also referred to as “cold storage” is A device or system that secures crypto private keys offline.

Collateralization

Collateralization is the process through which an individual secures a loan using their valuable assets as insurance.

Consensus Mechanism

The term “consensus mechanism” refers to a self-regulatory stack of protocols, algorithms, incentives, and concepts that help ensure a blockchain’s integrity. It is used in maintaining the underlying blockchain’s security and verifying transactions.

Creator Economy

The creator economy is the economic system built on the internet or digital platforms that enable individuals to earn money based on things they create.

Cross-Chain

Cross-chain technology allows blockchains to share and access information and assets across different blockchains without intermediaries.

Crypto Winter

A crypto winter is a long period of time when crypto prices dramatically drop below their previous all-time high values.

Cryptocurrency

A cryptocurrency is a virtual or digital currency that doesn’t depend on centralized authority, such as a government or central bank, to process transactions and issue new currency units.

Cryptography

Cryptography is the technique of securing information through using codes so that only the intended party can access it.

Custodian

A custodian is an entity that keeps an individual’s assets safe on their behalf.

Custody

Crypto custody involves safeguarding, storage, and management of digital assets on the behalf of individuals or institutions.

C

Data Availability

Data availability is the process of ensuring data is continually accessible to applications, end users, and organizations, when and where it is needed.

Decentralized Application

A decentralized application is a software program operating on a peer-to-peer network. It runs independently on the internet using smart contracts, outside the control of a single entity or authority.

Decentralized Automous Organization (DAO)

A decentralized autonomous organization (DAO) is a community with no centralized authority, in which members collectively make decisions in a bottom-up manner regarding its governance and operation.

Decentralized Digital Identity

A decentralized digital identity is a type of identity management that enables individuals to control their own digital identities, without relying on a centralized authority. The concept involves the creation of unique and verifiable identities directly controlled by the holders.

Decentralized Exchange (DEX)

A decentralized exchange (DEX) is a peer-to-peer marketplace that allows users to directly trade with each other. It doesn’t need a custodian or intermediary to hold the users’ funds or facilitate transactions.

Decentralized Finance

Decentralized Finance (DeFI) refers to financial applications and services that are built on a blockchain and operate without a central governing authority (hence, “decentralized”).

Deflationary Asset

A deflationary asset is a digital or virtual currency designed to decrease in supply over time, leading to an increase in its value.

Degen

In the context of the crypto community, "degen" is short for "degenerate" and is often used to refer to a person who is involved in high-risk, speculative trading or investing in cryptocurrencies.

Delegated Proof-of-Stake (DPoS)

Delegated proof-of-stake is a consensus mechanism which allows users of a network to vote and elect delegates who will validate transactions on that network.

Dencun

Dencun is an upgrade on the Ethereum blockchain aimed to improve its performance by optimizing execution efficiency and data availability within the network.

Depeg

A depeg is a phenomenon that occurs when a stablecoin, which is a cryptocurrency whose value is pegged to another currency, decreases or increases in value relative to the asset it is pegged to.

DePIN

A Decentralized Physical Infrastructure Network, or DePIN, is a protocol using cryptocurrency tokens to incentivize creating, maintaining, and operating real-world infrastructures in a decentralized manner.

Derivatives

Derivatives are products or contracts that obtain their value from an underlying asset like stocks, bonds, commodities, or cryptocurrencies.

Design Flaw Attack

A design flaw attack is a cyberattack where hackers use corrupted software to access a user’s cryptocurrency asset.

Desktop Wallet

A desktop wallet is a computer program or software cryptocurrency holders use to store and manage private and public keys. It is downloaded and executed on a personal computer.

Difficulty Time Bomb

The Difficulty Time Bomb describes the growing difficulty in mining Ethereum as the network transitions from a Proof of Work to a Proof of Stake blockchain.

Digital Signature

A digital signature is an encrypted, electronic imprint that authenticates digital information, software or messages. Like a handwritten signature, it verifies the identity and origin of data.

Distributed Ledger

A distributed ledger is a record or database spread across a network that is accessible from several geographical locations.

Dollar Cost Averaging

Dollar Cost Averaging (DCA) is a strategy that involves investing a fixed amount in any asset like digital asset at regular intervals.

Double Spending

Double spending is a scenario where an individual manages or attempts to use the same units of a currency more than once for valid transactions.

Dynamic NFT

Dynamic NFTs are a category of NFTs designed to change their characteristics based on certain pre-defined conditions. They have codes in their smart contracts that enable them to achieve this change.

DYOR

DYOR (Do Your Own Research) is a common crypto slang referring to the idea that investors should conduct extensive research before investing in a project.

D

Eclipse Attack

An eclipse attack is a type of P2P network threat that disrupts the operations of the network by isolating and manipulating one node.

EIP-4844

EIP-4844 is a proposed Ethereum network upgrade intended to boost the network’s scalability while reducing costs.

EIP-712

EIP-712 is a standard dictating how to structure and sign data on Ethereum so that it is both human-readable and machine-verifiable. .

Entropy

The entropy of a variable is the measure of the ‘unpredictability’ of that variable. In hardware wallets, entropy refers to the large random number that ensures your crypto wallet is secure.

ERC-1155

The ERC-1155 is a multi-token standard that allows for the creation of both fungible and non-fungible tokens within a single smart contract.

ERC-20 Tokens

ERC-20 tokens is the technical standard for fungible digital tokens that run only on the Ethereum blockchain network. They are built on smart contracts that keep track of the tokens created on the Ethereum network.

ERC-721

ERC-721 is the token standard used on Ethereum to create non-fungible tokens (NFTs). Each token created using the ERC-721 standard is unique and not interchangeable.

Ethereum 2.0

Ethereum 2.0 is an ongoing series of network upgrades aimed at addressing scalability, security, and accessibility

Ethereum Improvement Proposal

An Ethereum Improvement Proposal is a formal proposal to make changes or updates to the Ethereum network.

Ethereum Virtual Machine

The Ethereum Virtual Machine (EVM) is a software framework on the Ethereum network that allows developers to execute smart contracts and create decentralized applications.

E

Fear Of Missing Out (FOMO)

FOMO stands for the “fear of missing out,” which is the anxiety or fear traders experience when they think they are missing out on a profitable investment or trading opportunity.

Fiat

The term “fiat” or “fiat currency” refers to a type of currency that is declared by governments as a country’s legal tender. Fiat currencies include the USD, Euro, Sterling Pound, and Chinese Yuan amongst others.

Flash Loan

Flash loans allow you to borrow crypto assets without collateral or borrowing limits within the DeFi space. The lending condition is that you pay back the loan within the same blockchain transaction.

Flippening

The “Flippening” is the hypothetical moment when Ethereum will potentially surpass Bitcoin in terms of market capitalization.

Fork

A fork refers to a change or update to a system’s underlying code or software. Forks in blockchain change the set of rules governing a cryptocurrency’s protocol.

FUD

FUD is an acronym for “Fear, uncertainty, and doubt” which refers to the spread of false or negative information about a cryptocurrency or the market to create fear and doubt among investors.

Full Node

A full node is a component of a blockchain that stores and validates transactions. It is a computer program that ensures the security of a blockchain by enforcing consensus rules and transmitting data to other full nodes.

Fundamental Analysis

Fundamental analysis is a technique traders use to establish the underlying fundamental factors that affect an asset’s intrinsic value.

Futures

Crypto futures contracts are a derivative in which traders agree to either buy or sell an asset on a specific date at a predetermined price.

F

GameFi

GameFi is a new gaming concept that blends blockchain technology, non-fungible tokens, and game mechanics to create a virtual environment where players can participate and earn rewards.

Gas

Gas is the measurement unit for the amount of computational power required to complete a transaction on the Ethereum network.

Gas Fee

A gas fee is the amount you pay to complete a transaction on a blockchain.

Genesis Block

A genesis block is the first ever block recorded on a blockchain. The block is also known as Block 0 or Block 1.

Governance

Governance refers to the mechanisms and structures through which decisions are made within a blockchain network or cryptocurrency project.

Graphical Processing Unit

A graphical processing unit (GPU) is a hardware component designed to accelerate graphics rendering and increasingly perform parallel computing tasks across various applications.

Gwei

In Ethereum, Gwei serves as a standardized unit that quantifies transaction costs, gas fees, and computational resources for executing transactions.

G

Halving

Halving in crypto is an event that occurs in certain cryptocurrencies, such as Bitcoin, to reduce the rate of issuance of new coins and limit the total supply.

Hard Cap

A hard cap is the maximum number of tokens that a cryptocurrency project can ever produce.

Hard Fork

A hard fork is a significant change that permanently splits a blockchain into two different networks when the nodes fail to reach a consensus.

Hardware Security Module (HSM) 

A Hardware Security Module (HSM) is a hardware unit that safeguards and manages cryptographic keys.

Hardware Wallet

A hardware wallet is an external, physical device designed to securely store a user’s private keys offline.

Hash

A hash is a unique string of text created by mapping a piece of data through a mathematical function to encrypt and secure the data against alteration or unauthorized access. Hash can also be referred to as the digest, hash value, or hash code.

Hash Rate

A hash rate is a measure of the computational and processing power of a cryptocurrency network.

Hierarchical Deterministic Wallet

A hierarchical deterministic wallet is a special kind of wallet that uses a random number to create virtually infinite cryptocurrency key pairs.

HODL

"HODL" refers to the strategy of holding onto one's digital assets with a long-term perspective despite market fluctuations.

Hot Storage

Hot storage, also known as a “hot wallet” is a crypto wallet that is connected to the internet, allowing users to manage their crypto assets online.

Hot Wallet

A hot wallet is a crypto wallet that secures crypto private keys within an interface that is connected to the internet.

H

Identity Verification (IDV)

Identity Verification (IDV) is the process of confirming the validity and authenticity of an individual’s identity. The process involves validating the individual’s personal details from reliable sources to prevent fraud.

Immutable

The term “immutable” in the context of a blockchain implies that the data or ledger is permanent and tamper-proof, and its history cannot be modified or changed after its creation.

Impermanent Loss

Impermanent loss is a risk that occurs when participating in DeFi liquidity pools. It happens when the price of your deposited assets change from the time you deposited them.

Inflation

Inflation refers to a significant increase in asset prices over time due to a decline in the purchasing power of a specific currency.

Initial DEX Offering (IDO)

An Initial DEX Offering (IDO) is a crowdfunding method that enables blockchain projects to release their native coins or tokens through a decentralized exchange (DEX).

Interoperability

Blockchain interoperability refers to the ability to share or see information across different blockchains. It allows blockchains to communicate, share data, and build on each other’s features and use cases.

InterPlanetary File System (IPFS)

An InterPlanetary File System (IPFS) is a distributed, peer-to-peer system for sharing, storing and accessing files, digital data, applications, and websites.

I

Jager

Jager is a unit of measurement which represents a fraction of the cryptocurrency BNB (Binance Coin).

Joy Of Missing Out (JOMO)

Joy of missing out (JOMO) is a term that describes crypto enthusiasts who are happy they missed out on a plummeting coin or trade.

J

Keylogger

A keylogger is a tool deployed by hackers to record keystrokes and access sensitive data from a victim’s computer. In the crypto industry, cybercriminals often use it as an instrument to steal important information.

Know Your Customer (KYC)

KYC or “Know Your Customer” is a procedure used within financial institutions to confirm their customers’ identities and prevent fraudulent activity.

K

Layer 0

Layer 0 is the foundational infrastructure on which other blockchains and applications are built.

Layer 1 Blockchain

Layer 1 is the foundational layer of a blockchain network that provides the underlying infrastructure to securely process and validate transactions.

Layer 2 Blockchain

A layer 2 blockchain is a secondary network built on top of an existing blockchain network. It is a solution to extend the capabilities and performance of the base network.

Ledger

A ledger is a digital or physical log that records transactions associated with a financial system. Blockchain networks are a type of decentralized ledger system designed to store data securely.

Leverage

Leverage refers to when individuals use borrowed money or capital to amplify their buying or selling power in a market.

LFG

LFG, the acronym for “Let’s Fucking Go” or “Let’s Freaking Go,” represents an expression of excitement, enthusiasm, or support toward a crypto project or market.

Light Node

A light node is a blockchain component that stores limited or lightweight information rather than a complete copy of the network. Light nodes simply act as communication endpoints.

Lightning Network

The Lightning Network is a second layer built on the Bitcoin blockchain designed to scale the blockchain’s capability and conduct transactions more efficiently.

Limit Order

A limit order is an instruction to buy or sell an asset or security at a specific price level.

Liquid Staking

Liquid staking is a mechanism that allows users to lock up their cryptocurrency while still retaining their liquidity and tradability.

Liquidation

Liquidation in crypto refers to the process of converting assets, typically leveraged positions or collateral, into cash to cover losses or repay borrowed funds when the market moves unfavorably.

Liquidity Pool

A liquidity pool is a collection of digital assets or tokens supplied by platform users and locked in a smart contract to facilitate faster transactions.

Liquidity Provider

A crypto liquidity provider (LP) offers liquidity by locking their assets on a platform and earn trading fees in return.

L

Mainnet

A Mainnet is a blockchain that is independent, complete, and runs by itself, where all crypto transactions are broadcasted, verified, processed, and recorded on its distributed ledger.

Margin Trading

Margin trading is the practice of trading with borrowed money to improve one’s trading position.

Market Capitalization

Market capitalization is a measure of the total value of a cryptocurrency. It is calculated by multiplying the current market price of a coin by its available supply.

Maximal Extractable Value (MEV)

Maximal extractable value (MEV) is the maximum value block producers (miners or validators) can obtain by including, reordering, or excluding transactions when producing a new block.

Mempool

A mempool is a node’s mechanism for tracking all the unconfirmed transactions.

Merkle Tree

A Merkle tree is a way of organizing data to make it more secure and efficient to process.

Metadata

Metadata is a basic summary about a larger set of data. Metadata helps users understand the nature and context of a larger set of data.

Metaverse

A metaverse is a digital or virtual realm containing all the aspects of the real world.

Miner

A miner is a participant in a cryptocurrency network responsible for generating new coins and verifying transactions.

Miner Fee

A miner fee is the fee that a blockchain charges to process and confirm transactions on the network.

Mining

Mining is the process of confirming and validating transactions and adding them to a proof-of-work blockchain.

Mining Pool

A mining pool is a collection of crypto miners who combine their computing resources to increase their chances of earning a reward.

Minting

Minting in the context of blockchain refers to the mechanism through which new coins or tokens are produced and introduced into circulation.

Mobile Wallet

A mobile wallet is a built-in feature or software application that can be installed on a smartphone. In crypto, the program stores users’ private keys and allows them to interact with their digital assets.

Modular Blockchain

A modular blockchain is a blockchain that specializes in performing a few responsibilities or functions and delegating the rest to other layers.

Multichain

A multichain is an application designed to operate across isolated chains, allowing them to communicate with each other.

Multisignature

Multisignature or “multisig” transactions are a type of transaction that requires multiple signatures for a single transaction to be executed.

M

Network Effects

Network effects is the phenomenon through which a product or service becomes more valuable or useful as more people use it.

Network Fee

A network fee, also called a miner fee, is the fee that users pay a blockchain network to conduct a transaction on that network. The network fee incentivizes miners or validators to verify and confirm the transaction.

No-Coiner

A no-coiner is an individual who believes cryptocurrencies have no significant value and, therefore, holds none.

Node

A node refers to a computer that participates in a blockchain network and is responsible for creating, receiving, and transmitting a message.

Non-Custodial Wallet

Non-Custodial wallets, also known as self-custodial wallets, are crypto wallets that give you complete control over your public and private keys, and subsequently full control over your crypto wallet and assets.

Non-Fungible Token (NFT)

An NFT, or non-fungible token, is a digital asset that represents ownership of a unique item or asset including art, music, in-game items, and other forms of media.

Nonce

A nonce is a variable input used by miners to find a valid hash for a block. It is an authentication model used to verify the validity of data in the blocks.

N

Off-Chain Transaction

Off-chain transactions is a transfer of value or data, including transactions, that occurs outside a given blockchain network.

Offline Storage

Offline storage is the method of holding private keys in devices not connected to the internet.

On-Chain

On-chain transactions are transactions that are recorded on the blockchain’s distributed ledger and are publicly accessible to anyone who has a copy of the blockchain’s ledger.

Online Storage

Online storage refers to the act of storing or holding data on a medium that connects to the internet. In crypto, it involves using cryptocurrency wallets connected to the internet to store and manage private keys.

Open Source

Open source is a principle between developers who believe in creating, sharing, and modifying data freely for public use. Transparency and free participation are often the goal.

Options

Options are a type of contract that grants a trader the right, rather than the obligation, to buy or sell an underlying asset at a predetermined price within a specific timeframe.

Oracle

Oracles are bridges that connect blockchains and smart contracts with external systems and off-chain data. They are third-party services that transmit information from external sources into smart contracts to help them execute based on predefined conditions.

Order Book

An order book is an electronic list of all open buy and sell orders available for a specific trading pair on an exchange or marketplace. The buy and sell orders are organized by price levels.

Ordinals

Ordinals are NFT-like digital content that can be directly created or minted on the Bitcoin blockchain.

Orphan Block

An orphan block (orphan) is a valid block that does not have a parent block and is not included in the main blockchain.

Over-the-Counter

Over-the-counter (OTC) trading refers to trading that is carried out through dealer networks rather than formal exchanges.

O

Paper Trading

Paper trading is the practice of simulating trades in cryptocurrencies or other financial instruments, like stocks, without investing real money. Paper trading helps users practice trading strategies before investing with actual funds.

Pedersen Verifiable Secret Sharing

Pedersen Verifiable Secret Sharing (PVSS) is a variation of the Shamir Secret Sharing scheme, which involves securely dividing private information into smaller parts. PVSS is used to confirm that the custodians of these parts have the correct fragments.

Peer-to-Peer

Peer-to-peer, also known as P2P, is a network of distributed computers that are linked and share data, assets, or tasks.

Pegged

The term “pegged” describes an asset whose value is attached to the value of another. It is designed to maintain a specific ratio to the designated asset.

Permissioned Blockchain

A permissioned blockchain is a distributed ledger with limited accessibility. Only certain authorized individuals can access it.

Play To Earn

A Play to Earn (P2E) game is an online game that rewards the players for their active participation or in-game achievements such as completing tasks, clearing game levels, or winning player-versus-player (PvP) battles.

Ponzi Scheme

A Ponzi Scheme is a fraudulent investment strategy where investors are promised high returns with minimal to no risk.

Privacy Coin

“Privacy coin” is a type of cryptocurrencies built on the principles of preserving privacy and enhancing data security. They are designed to conceal transactions and trader identities.

Private Blockchain

A private blockchain is a type of blockchain owned or controlled by a single entity. Access to it is restricted to specific users.

Private Key

A private key is a string of characters that allows you to access and manage your digital assets. It is used to sign transactions and provide proof of ownership for the corresponding cryptocurrencies.

Proof of Attendance Protocol (POAP)

Proof of attendance protocol is a collectible that acts as a digital badge to prove that an individual attended an event.

Proof of Authority

Proof of authority is an algorithm that gives a select number of participants the right to confirm transactions and create new blocks.

Proof of History

Proof of history is an algorithm blockchain networks use to verify the passage of time of each block to ensure historical data accuracy.

Proof of Knowledge

Proof of knowledge refers to a protocol where one party (the prover) succeeds in convincing the other party (the verifier) that they know something.

Proof of Reserves (PoR)

Proof of Reserves (PoR) is a verification method to demonstrate that an exchange is maintaining its users’ digital assets. It shows that the exchange has enough liquidity in proportion to its users’ stored assets on the platform.

Proof of Stake

Proof of stake is a consensus mechanism that selects validators based on the amount of cryptocurrency they stake to process transactions and produce new blocks.

Proof of Staked Authority

Proof of Staked Authority is the amalgamation of proof of stake and proof of authority consensus mechanisms.

Proof of Work (PoW)

Proof of Work (PoW) is a method that cryptocurrency networks use to verify and validate transactions in a blockchain.

Public Address

A public address is what allows individuals to request or receive cryptocurrency payments into their digital wallets.

Public Blockchain

A public blockchain is a decentralized network that is not controlled by a single entity. It is accessible to anyone, anywhere in the world.

Public Key

A public key is a code of alphanumeric characters that users use to receive cryptocurrency in their wallets.

Pump and Dump

A pump and dump is a form of investment scam that involves artificially inflating the price of an asset with misleading positive news and then abruptly selling it.

P

QR Code

A quick response (QR) code is a type of barcode with encoded information that can easily be read by a mobile or device. In crypto, a QR code can be used to share wallet addresses and make payment.

Queued Transaction

A queued transaction is a transaction that waits to be validated before it can be available for processing and inclusion in a block.

Q

Random Standards

Random standards refer to the ideal or level of quality through which a randomly generated value is considered acceptable or truly random.

Rare Sats

Rare sats is the smallest denomination of Bitcoin considered unique and more scarce than its peers.

Real World Assets (RWA)

Real-world assets (RWA) represent tangible and intangible assets as digital tokens on a blockchain network.

Recession

A recession is a period of substantial economic downturn that lasts for months or years.

Recursive Inscriptions

Recursive inscriptions are the process of extracting or retrieving data from its existing host and using it in new inscriptions.

Rekt

Rekt is crypto slang that means “to lose most or all of your funds due to a bad investment or trade.”

Relative Strength Index (RSI)

The Relative Strength Index is an indicator that measures how rapidly the price of a digital asset is moving. It also identifies oversold and overbought assets.

Relay Chain

The relay chain acts as the central chain of data in the Polkadot network, a protocol that allows interoperability between different blockchain networks.

Return On Investment (ROI)

ROI, or Return on Investment, is a financial metric used by investors to assess the profitability and performance of an investment by measuring the profit relative to its initial cost,

Royalty

In cryptocurrency, a royalty refers to the payments that a creator makes upon each resale of their digital asset or art. The payment is a predetermined percentage of the proceeds from all future sales on the secondary market.

Rug Pull

A rug pull is a type of crypto scam when founders of a project bring in investors to inflate the value of a project, but later pull their inflated funds and abandon the project, leaving victims with a worthless investment.

R

Satoshi Nakamoto

Satoshi Nakamoto is the pseudonym founder(s) who invented Bitcoin and authored its whitepaper.

Schnorr Signature

A Schnorr signature is a type of digital signature that combines multiple signatures into a single signature. This improves a blockchain’s privacy, efficiency, and scalability.

Secure Element (SE)

A Secure Element (SE) is a microprocessor chip that facilitates the secure storage and processing of sensitive data. It is commonly used in SIM cards, passports and credit cards.

Security Audit

A security audit is a thorough, systematic examination of a software, application, or system to find any flaws, fix any issues, and determine if the platform is secure.

Seed Phrase

A seed phrase is a collection of randomly generated words that represent all private keys associated with a given crypto wallet; the phrase enables the contents of a crypto wallet to be restored, even if access to the wallet itself is lost.

Segregated Witness (Segwit)

Segregated Witness, or “SegWit” is an upgrade for the Bitcoin network designed to allow more transactions to fit within each block on the blockchain.

Self Custody

Self custody is when a user takes full control and responsibility of holding and managing their digital assets without relying on third-party intermediaries.

SHA-256

SHA 256 is an algorithm used in Proof-of-Work blockchains like Bitcoin to verify transactions.

Shamir Secret Sharing (SSS)

Shamir Secret Sharing (SSS) is a technique to break private information into smaller fragments to keep the information safe. Reconstructing the entire original data requires a certain amount of these shares.

Shanghai Upgrade

The Shanghai Upgrade is an upgrade on the Ethereum network that allows stakers and validators to unstake and withdraw their staked Ether.

Shapella Fork

The Shapella fork is the combination of two major Ethereum network upgrades (Shanghai and Capella upgrades) that occurred simultaneously. Together, these upgrades allowed users to withdraw their staked ETH on the network.

Shard

A shard is a small fragment of data split from a larger part of a database or blockchain network.

Shitcoin

Shitcoin is a colloquial term for cryptocurrencies that have no real-world potential value, practical purpose, and utility. They are often a subject of speculation.

Sidechain

A sidechain is a discrete blockchain that is connected to the main blockchain or mainnet through a 2-way bridge. Sidechains were created to solve transaction speed issues in blockchains by decongesting the mainnet.

Simplified Payment Verification (SPV)

Simplified payment verification is a lightweight client that verifies cryptocurrency transactions without downloading the entire blockchain.

Slashing

Slashing is a process that penalizes validators of proof-of-stake networks when they act dishonestly or behave abnormally. It entails deducting a predetermined percentage from their staked cryptocurrency.

Slippage

Slippage is the difference between the expected outcome and the actual outcome of a trade. It occurs when a trader settles for a different price than they requested to buy or sell an asset, either due to its price movement or low market liquidity.

Smart Contract

A smart contract is an agreement in the form of a computer program that automatically executes when predefined conditions are met.

Social Engineering

Social engineering is a deceptive strategy to persuade people to perform certain operations or reveal confidential information.

Soft Fork

A soft fork refers to a protocol change or modification on a blockchain’s software that invalidates transactions that were previously accepted, which requires miners to update their mining software for older nodes.

Software Wallet

A software wallet is a program that stores the private keys to enable users to hold, send, and receive cryptocurrency assets.

Solidity

Solidity is a high-level, object-oriented programming language created for designing and implementing smart contracts.

Source Code

A source code is a computer code or programming statements that define how a software functions based on specific instructions.

Stablecoin

Stablecoins are a type of cryptocurrency that is pegged or tied to another asset, such as fiat currencies or gold.

Stack the Sats

Stack the sats is a mantra for encouraging Bitcoin enthusiasts to amass small amounts of Bitcoin.

Staking

Staking refers to when a blockchain user locks up their cryptocurrency to secure the network and earn rewards.

Staking Pool

A staking pool is a mechanism that allows individuals to combine and lock their digital assets in a proof-of-stake blockchain. It is a way for users to increase their chances of successfully verifying and validating new blocks.

Stop Loss Order

A stop-loss order is a type of order investors preset to limit potential losses in an investment. It is automatically executed when a cryptocurrency value reaches a predetermined price level to protect the trader from excessive losses.

Subnet

A subnet (sub-network) is a network within a network.

Swap

Swap is the process of exchanging one digital asset for another directly.

Sybil Attack

A Sybil attack is a security threat on a peer-to-peer network where a malicious actor attempts to sabotage the network’s reputation by creating multiple fake identities.

S

Taproot

Taproot is an upgrade on the Bitcoin blockchain that was approved and implemented by developers in 2021. It was designed to improve efficiency and privacy on the network.

Technical Analysis

Technical analysis is the study of past market activities, such as price movement and volume data, to estimate an asset’s price direction.

Testnet

A testnet is like a practice version of the main blockchain network. It lets developers test new ideas and features without affecting the main network.

Ticker

A ticker in crypto is a symbol with a unique combination of letters to help identify a particular cryptocurrency.

Timestamp

A timestamp is a digital record used in blockchain networks to track when information and data was exchanged, created, or removed.

To The Moon

“To the moon” is slang in the crypto community that refers to a belief that a specific cryptocurrency’s value will soon increase significantly.

Token

Tokens are a type of digital asset that refers to a programmable unit of value or utility and can be used to represent ownership, access rights, or participate in decentralized applications.

Tokenization

Tokenization is the process of representing a real-world asset digitally by converting the asset into a surrogate value. The primary goal is to enhance data security while retaining essential information.

Tokenomics

Tokenomics refers to the analysis of factors that may influence the value of a digital asset, such as supply and demand.

Total Supply

The total supply of a cryptocurrency measures how many of the currency’s coins/tokens are currently in existence.

Total Value Locked (TVL)

Total value locked (TVL) is a metric that refers to the sum of assets that are staked or locked in a protocol.

TradFi

TradFi (traditional finance) is the conventional way of moving or handling money via traditional financial systems and institutions.

Trading Bot

A trading bot is a piece of software designed to automate trade-related tasks in cryptocurrency markets.

Trading Volume

Trading volume in crypto refers to the total amount of funds flowing in and out of a specific cryptocurrency or the crypto market over a given period.

Transaction Fee

A transaction fee is a payment that users make for using services on a blockchain or an exchange.

Transaction ID (TXID)

A transaction ID (TXID) or transaction hash is a unique set of numbers given to every verified transaction on the blockchain.

Transactions Per Second (TPS)

Transactions Per Second (TPS) is the number of transactions that a network can process in a second. It is a measurement used to evaluate the transaction speed of a network.

Turing Complete

The term Turing Complete refers to a system that can perform complex computations by design when given sufficient resources, such as time and memory.

T

Unconfirmed Transaction

An unconfirmed transaction is any transaction request submitted to the blockchain that is yet to be processed or validated.

Unspent Transaction Output (UTXO)

Unspent Transaction Output (UTXO) refers to the amount of a cryptocurrency that is leftover following a specific transaction.

Utility Token

A utility token, also known as a ‘user token’, serves a specific function that gives holders access to features of a decentralized application or ecosystem and forms the economy of that system. This could include a DEX, metaverse platform or blockchain based Web3 platform.

U

Validator

A blockchain validator is a computer or node that verifies transactions in the blockchain network.

Vesting

Vesting is a process where a certain amount of a project’s overall token supply is set aside for a period of time and released after certain conditions are met.

Vesting Period

A vesting period in crypto refers to a predetermined time frame during which certain tokens or assets are restricted and become accessible or transferable over time.

Volatility

Volatility is a measure of how much an asset’s price fluctuates over time. It describes how much and how quickly a particular asset’s value can shift.

Volume

Volume, specifically trading volume, refers to how much of a specific asset has been traded within a specific timeframe.

V

WAGMI

WAGMI, an acronym for “We’re All Gonna Make It”, is a term used to combat uncertainty and build confidence in the crypto market. It is a rallying cry meant to restore hope in the crypto market, though it can also be used sarcastically.

Wallet

A wallet is a tool that allows users to store, send, and receive digital assets, such as Bitcoin, Ether, and other altcoins.

Wallet Address

A wallet address is a randomly generated string of characters used to send or receive digital assets.

Wash Trading

A wash trade is a kind of market manipulation where an individual simultaneously sells and repurchases the same assets, such as NFTs, cryptocurrencies or stocks. This deceptive practice is an attempt to influence the asset’s value or trading volume.

Weak Hands

“Weak hands” is a negative term used to describe a trader with a low-risk tolerance or low confidence in a volatile asset that they’ve invested in.

Web 1.0

Web 1.0 is the term for the earliest version of the Internet from the 1990s to the early 2000s. It was characterized by “read only” static websites and the first implementation of the World Wide Web.

Whale

A crypto whale is an individual or entity that holds a large proportion of a specific cryptocurrency's token supply.

Whitepaper

A whitepaper is a comprehensive document that outlines key information about a specific project.

Wrapped Bitcoin

Wrapped Bitcoin is a tokenized representation of Bitcoin that is interoperable with decentralized applications on the Ethereum blockchain.

Wrapped Ether

Wrapped Ether (WETH) is an ERC-20 compatible token that is pegged to Ether at a 1:1 ratio.

W

Year To Date

Year to date (YTD) is the measurement of an asset’s performance beginning from the start of the calendar or fiscal year to the present date.

Yield Farming

Yield farming is the practice of lending or locking up assets in a DeFi protocol to earn rewards.

Y

Zero Confirmation Transaction

A zero confirmation transaction is any transaction that has not been recorded or validated on a blockchain.

Zero-Knowledge Proof

A Zero-knowledge proof (ZKP) is a type of secure verification that allows one party to prove the validity of something, without having to reveal any personal details, passwords, or statements. In the context of blockchain it is a cryptographic method that allows for the verification of a data without the need to reveal any of the underlying data.

Zk-SNARKs

A Zk-SNARK is a special mathematical technique that allows individuals to prove that something is true without revealing specific details about it.

Z

Sharding

In the context of blockchain, sharding refers to dividing the network into smaller partitions to improve accessibility, scalability, and process more transactions per second.

51% Attack

A 51% attack is a type of attack on a blockchain network, wherein a single person or a group of people try to gain control of a network, generally in order to commit malicious acts, such as double-spending.

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