CRYPTO JARGON (LANGUAGE IN THE CRYPTOCURRENCY SPACE)

Sources - https://tradersofcrypto.com/guides/crypto-jargon-explained/
- https://www.finder.com/cryptocurrency-glossary

Crypto can sometimes feel like its own language so with the aid of some trusted websites
(sources above), we have compiled a list of some of the most common jargon and a brief
explanation of what it means.

51% Attack
A network takeover, when a malicious actor manages to hold more than 51% of the mining
power. With that influence, an attacker can challenge the blocks discovered by other miners
and replace them with their own blocks. A 51% attack aims to erase transactions, usually with
the goal to double-spend the coins.
Addresses
A unique address that identifies where a cryptocurrency sits on the blockchain. It’s this
location at which the coin’s ownership data is stored and where any changes are registered
when it is traded. Addresses look different among cryptocurrencies but are usually a string of
more than 30 characters.
Airdrop
The gifting of tokens to a wide audience, after registration or just as an act of goodwill.
Airdrops became immensely popular in 2018, boosting the visibility of start-ups. Airdrops
replaced token sales during the two-year bear market, to build a crypto community without
the need for a significant investment.
All-time high & All-time low
Highest price ever achieved by a cryptocurrency. Abbreviated to ATH.
Lowest price ever achieved by a cryptocurrency. Abbreviated to ATL.
Altcoin
Any other coin but bitcoin. Altcoins started to appear a few years after BTC became popular.
Altcoins use various types of generation techniques, either through mining or through a
lottery principle.

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AML
Short for Anti-money-laundering, a set of guidelines to banks and the financial sector, which
were also extended to cryptocurrency brokerages and exchanges. AML includes customer
screening, as well as monitoring for suspicious activity. The chief aim of AML laws is to
monitor and block suspicious activity, especially related to terrorism financing. AML laws have
existed for decades, and cryptocurrency trading and other operations only tried to circumvent
the rules in the first few years. AML rules are the reason some jurisdictions cannot legally
trade some types of tokens, or access specific exchanges internationally.
Arbitrage
The act of buying from one exchange and then selling it to another exchange if the margin
between the two is profitable. Multiple exchanges trade in the same cryptocurrency at any
given time, and they can do so at different rates.
Atomic swap
A way of letting people directly and cost-effectively exchange one type of cryptocurrency for
another, at current rates, without needing to buy or sell.
Bag
A large quantity of units in a certain cryptocurrency. E.g.“My bags are full of Solana.”
Bear, bearish
If the price of a cryptocurrency has a negative price movement.
Bear Trap
This is a trick played by a group of traders aimed at manipulating the price of a
cryptocurrency. The bear trap is set by this group all selling their cryptocurrency at the same
time, which bluffs the market into thinking there is a drop incoming. As a result, other traders
sell their assets, further driving the price down. Those who set the trap then release it, buying
back their assets, which are now at a lower price. The overall price then rebounds, allowing
them to make a profit.
Block
A set of transactions bundled together and signified by a unique block header. A block
contains the transactions of users, along with a cryptographic transformation of the data plus
the previous block header number. Think of a block as a set of accounting entries, signed and
secured into a ledger.

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Block Explorer
An online tool for exploring the blockchain of a cryptocurrency, where you can watch and
follow, live, all the transactions happening on the blockchain. Block explorers can serve as
blockchain analysis and provide information such as total network hash rate, coin supply,
transaction growth, etc.
Block Height
Refers to the number of blocks connected in the blockchain. For example, Height 0 would be
the very first block, which is also called the genesis block.
Block Reward
A certain reward of coins received by miners, in exchange for the resource-intensive task of
finding the block header. The Bitcoin network started with a block reward of 50 BTC, and that
reward is cut in half every four years.
Blockchain
The blockchain is a digital ledger of all the transactions ever made in a particular
cryptocurrency. It’s comprised of individual blocks (see definition above) that are chained to
each other through a cryptographic signature. Each time a block’s capacity is reached, a new
block is added to the chain. The blockchain is repeatedly copied and saved onto thousands of
computers all around the world, and it must always match each copy. As there is no master
copy stored in one location, it’s considered decentralized.
BTFD
Acronym for “Buy The F$%king Dip”. A less-than-savory phrase used when you’re
(enthusiastically) telling someone a currency has dipped to a low value and should be bought.
Bull/Bullish
If the price of a cryptocurrency has a positive price movement.
Circulating Supply
The total number of coins in a cryptocurrency that are in the publicly tradable space is
considered the circulating supply. Some coins can be locked, reserved or burned, therefore
unavailable to public trading.
Cold Storage
The act of storing crypto assets offline, with the intention of keeping them long-term. Cold
storage is a way to protect the assets from technical mistakes or theft. Unlike hot wallets,
which communicate with the Internet, cold wallets may simply be a piece of paper with the
private key or seed phrase written down. A cold storage wallet may be used to keep larger
balances of coins, not using the address for high-frequency transactions.

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Confirmations
When a transaction is included into a block, it receives one confirmation. When a transaction
has been confirmed, it means it has been approved by the network and permanently
appended to the blockchain.
Consensus
When a transaction is made, all nodes on the network verify that it is valid on the blockchain,
and if so, they have a consensus.
Cryptocurrency
A form of money that exists as encrypted, digital information. Operating independently of any
banks, a cryptocurrency uses sophisticated mathematics to regulate the creation and transfer
of funds between entities.
DAO
Acronym for “decentralized autonomous organization”. This refers to organizations that are
run by an application (computer program) rather than direct human input. Control of this
application is granted to everyone rather than a single central entity.
DAG
Distributed acyclic graph, a data structure employed to create a novel type of distributed
network. Unlike a blockchain with dedicated nodes, a DAG-based project turns every user into
a node. The IOTA project uses a DAG technology. When making a transaction, each user must
verify two older transactions. The IOTA architecture is such that there can be no repeat
transactions, and it has only one direction, from older to newer transactions. This makes the
IOTA “tangle” both directed and acyclic, fulfilling the requirements for this topological
structure.
Dapp
Shorthand for “decentralized application “which is a computer program that utilizes a
blockchain for data storage, runs autonomously, is not controlled, or operated from a single
entity, is open source and has its use incentivized by the reward of fees or tokens

Decentralised
Not tied to a central authority. A network is decentralised if it is geographically distributed, and
consensus does not depend on a single point of failure. Also applicable to distributed
computing, where computing resources are shared and communicate through the Internet
infrastructure.

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Defi
Short for Decentralized Finance. Financial operations such as lending, trading, bank-like
deposits, emulated through the Ethereum blockchain. DeFi is viewed mostly as a source of
passive income, though highly risky as financial projects can rise and fall within days, based
on hype.
Digital Signature
Used to confirm that a document being transmitted electronically is authentic. They generally
appear as a code generated by a public key encryption.
Distributed Ledger
A ledger that is stored in multiple locations so that any entries can be accessed and checked
by multiple parties. In cryptocurrency, this refers to the blockchain being held on multiple
nodes on the network, all of which are checked simultaneously.

Double Spend
This occurs when someone tries to send a cryptocurrency to two different wallets or locations
at the same time.
DPOS
Short for Delegated Proof-of-Stake. A network where instead of miners, a chosen set of
supporting servers or another type of computation nodes are established to produce new
blocks and confirm transactions. Delegates range from 7 to 100, and their task is to
coordinate and avoid conflicts in the distributed ledger.
Dumping
When a lot of people dump at once, causing a sharp downward movement in a
cryptocurrency’s price.
DYOR
Acronym for “do your own research”.
ERC-20
The standard to which each Ethereum token complies. It defines the way that each token
behaves so that transactions are predictable. Other cryptocurrencies also use the ERC-20
standard, piggybacking on the Ethereum network in the process.
Escrow
When an intermediary is used to hold funds during a transaction, those funds are being held
in escrow. This is usually a third party between the entity sending and the one receiving.

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Ethereum
One of the top three cryptocurrencies in the world based on its market capitalization. Despite
being open source and based on blockchain technology, it differs from bitcoin in two key
ways: it allows developers to create dApps and also write smart contracts.
Ethereum Virtual Machine (EVM)
A virtual machine, effectively sitting in the cloud, that is Turing complete and is used by all
nodes on the network during blockchain confirmations. It allows those on the node to execute
random EVM Byte Code, which is part of the Ethereum Protocol.
Exchange
An establishment for buying and selling cryptocurrency. Some exchanges also allow the
selling of cryptocurrencies for fiat. Exchanges can be centrally controlled, with orders
matched through order books. Crypto assets can also be traded on decentralized or
algorithmic exchanges, which use a smart contract to shift between assets.
Faucet
If you find a website that offers to give you free cryptocurrency for connecting with them, it is
termed a faucet. The majority of these are scams however some do award micro-amounts of
cryptocurrency, to give a taste of ownership so you can use the network.
Fiat
Government-issued money, based on faith (“fiat”). A government can print any amount of fiat
it decides. The opposite of sound money. The value of fiat is not fixed, but inflationary. Fiat is
printed by a central bank, and injected into the economy, in theory boosting economic activity
while trying to keep inflation within reasonable bounds.
FOMO
Fear of Missing Out, an overwhelming urge to invest in an asset in case its price goes “to the
moon”. FOMO is greed-driven, expecting to find the next new hot asset. The risk of FOMO lies
in buying an asset near its blow-off top, believing it would rise much higher. Unfortunately,
using FOMO as justification to trade has the potential to lead to deep losses.

Fork
When a new version of a blockchain is created, resulting in two versions of the blockchain
running side-by-side, it is termed a fork. As a single blockchain forks into two, they will both
run on the same network. Forks are categorized into two categories: soft or hard.

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FUD
Shorthand for Fear, Uncertainty, Doubt. Usually, a message that may spark market panic, with
the suspicion that the FUD was deliberate. Examples include “government crackdown”,
exchange hacks, lawsuits, and other disasters of various scale within the crypto space. FUD
can quickly turn the sentiment of the market and change the ratio of fear and greed.
Gas
Gas a is measurement given to an operation in the Ethereum network that relates to the
computational power required to complete it. That measurement relates to the fee offered to
miners who process that transaction. Other operations have a small cost of 3 to 10 gas, but a
full transaction costs 21,000 gas.
Gas Limit
When users make a transaction on the Ethereum network, they set their gas limit, which is
the most they are willing to pay as a fee for that transaction. If the transaction is going to cost
more gas than what is offered, the transaction will not go through. If it costs less, the
difference will be refunded.
Gas Price
The amount you are willing to pay for a transaction on the Ethereum network. If you want
miners to process your transaction fast, then you should offer a higher price. Gas prices are
usually denominated in Gwei.
Halving
Every time miners approve transactions on the bitcoin blockchain, they earn bitcoin. As each
block on the blockchain fills up with transactions, a certain amount of bitcoin enters the
marketplace. However, the number of bitcoin that will ever be created is finite, locked at 21
million. To ensure this cap is kept, the amount of bitcoin earned by miners for filling one block
is halved at the completion of that block. This is called halving. For the record, by the year
2140, all 21 million bitcoin will be in circulation.
Hard Cap
During an Initial Coin Offering (ICO) the creator can set a hard cap. This is the maximum
amount it planned to raise, and it will therefore stop offering coins at this figure.
Hardware Wallet
A device resembling a USB stick, with a special hardware for secure, offline storage of seed
phrases and private keys. Hardware wallets include Trezor and Ledger Nano. A hardware
wallet uses electronics to secure the private key and does not reveal the data when
communicating with other devices. It’s considered the most secure way to hold
cryptocurrency.

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HODL
A misspelling of the word “hold”, attributed to the user GameKyuubi at the Bitcointalk forum.
Back in 2013, a period of price volatility in BTC helped differentiate between active trading,
and a buy-and-hold strategy. Since then, “hodling” became a meme in the crypto space,
especially pertaining to BTC and its long-term prospects as an alternative to fiat.
ICO
In order to raise funds, the creator of a cryptocurrency will put an initial batch of its coins up
for purchase. This is an initial coin offering.
KYC
Short for Know Your Customer, a procedure based on international and national anti-money-
laundering laws (see AML). KYC requires businesses to reveal the identity of their users.
Most exchanges and crypto brokerages now require a picture ID to verify the account and
allow a higher trading volume. KYC means exchanging between crypto and fiat can be
traceable to a physical or legal person and is not fully anonymous.
LAMBO
Shorthand for Lamborghini, which is how someone might refer to themselves if they are
getting rich quickly. The idea being there is so much money coming in that they are going to
go buy an exotic car.
Limit Order
A limit order stipulates a price at which an asset will be acquired. A limit order will only be
filled if the asset reaches that price. It is possible for a limit order to wait and never be filled. A
limit order can be used in crypto for protection in case of falling prices, to sell before the
price drops even lower.
Ledger
A record of financial transactions. A ledger cannot be changed, it can only be appended with
new transactions.
Leverage
A loan of sorts offered by a broker on an exchange during margin trading (see below).
Lightning Network
A peer-to-peer system for cryptocurrency micropayments that is focused on low latency,
instant payments. They’re typically low cost, scalable and can work across chains, and
transactions can be public or private.

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Liquidity
The available funds for trading. The readiness of being able to convert one type of asset into
another. In cryptocurrency trading, liquidity can determine the size of an asset market, and
the ease of exchanging the asset. Liquidity in DeFi trading means a certain balance of funds
locked in a smart contract, ensuring that the DeFi tokens will trade without crashing.
Locktime
If a transaction request comes with a rule delaying when it can be processed to a certain time
or certain block on the blockchain, that is referred to as the locktime.
Long
When you intend to take a large amount of cryptocurrency and stockpile it with the
anticipation that it will grow in value, you are going long (or taking a long position).
Margin Call
A margin call occurs during margin trading, requiring the input of additional funds. Trading on
margin calls for a minimum balance, and a margin call usually occurs when an asset makes a
significant shift in value. Margin calls occur for BTC in both short and long positions. In crypto
trading, margin calls often lead to the forced closing of the position, as traders may struggle
to add more collateral.
Margin Trading
Trading with borrowed funds, with the potential to gain with a small initial sum. Because BTC
and crypto assets are very volatile, margin trading is extremely risky. Margin trading is offered
on the BitMex exchange, with smaller markets on Binance, Deribit, Kraken, and even
Coinbase.
Market Order
A market order is the choice of traders who want to be certain of making a trade. A market
order will happen at the best available current price. In crypto trading, a market order is not
seen as ideal, as conditions can switch within minutes.
Mining
The term, somewhat confusingly, given to the process of verifying transactions on a
blockchain. In the process of solving the encryption challenges, the person donating the
computer power is granted new fractions of the cryptocurrency.

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Mining Pool
If a number of miners combine their computing power together to try and help complete the
transactions required to start a new block in the blockchain, they are in a mining pool. The
rewards are spread proportionately between those in the mining pool based on the amount of
power they contributed. The idea is that being in a mining pool allows for better chances of
successful hashing and therefore getting enough cryptocurrency reward to produce an
income.
Moon
A term used to describe a major price movement upwards. For example, Terra Luna is
mooning.
Node
A device communicating with other computers, and responsible for holding a partial or entire
record of all transactions to date. Different networks have varying node requirements, ranging
from as low as seven, to as high as 10,000 nodes for the Bitcoin network. A node works like a
bank clerk, approving the final version of transactions. Nodes communicate between each
other mostly over the existing Internet infrastructure. Nodes can also fulfill other functions
such as voting. Nodes have to achieve consensus and agree on the same version of the
distributed ledger.
Nonce
When a miner hashes a transaction, a random number is generated, called a nonce. The
parameters from which that number is chosen change based on the difficulty of the
transaction.
Oracles
The smart contracts stored on a blockchain are stuck within the network. They can only be
reached by the external world through a program called an oracle. The oracle sends the data
to and from the smart contract and the outside world as required. Oracles are most
commonly found on the Ethereum network.
OTC
Over-the-counter, a trading technique to connect buyers and sellers directly, without the need
to place orders on the open market. Liquidity in crypto assets is relatively low, and a large-
scale order may lead to price slippage or outright panic. For that reason, large buyers and
sellers seek OTC platforms to match their demands.
Pair
The exchange mechanism between two crypto assets, or more rarely, between a crypto asset
and a fiat currency. More trading pairs mean higher liquidity and options to trade. The most
common pairs are against BTC, ETH, as well as against stablecoin Tether (USDT).

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Paper Wallet
A printout of the private/public key pair, usually with a 2D code. A paper wallet should remain
hidden, taking care not to display the part containing the private key. Paper wallets are often
used for cold storage.
Private Key
A long alpha-numeric string, which gives control over a crypto wallet. The private key is
cryptographically generated. It must never be shared or exposed in any way to third parties,
else there is a risk that a malicious actor will steal all assets within that wallet. Losing a private
key means irretrievable loss of the wallet.
Proof of Authority (PoA)
A private key that gives the holder the right to create the blocks in a private blockchain. It can
be held by a single entity or a set number of entities. This is an alternative to the proof-of-
work model, as instead of getting multiple random nodes to approve a transaction, a group of
specific nodes are given the authority to approve. This is a far faster method
Proof of Stake (PoS)
Another alternative to proof of work, this caps the reward given to miners for providing their
computational power to the network at that miner’s investment in the cryptocurrency. So if a
miner holds three coins, they can only earn three coins. The system encourages miners to
stick with a certain blockchain rather than converting their rewards to an alternate
cryptocurrency.
Proof of Work (PoW)
In order to receive a reward for mining a cryptocurrency, miners must show that their
computers contributed effort to approve a transaction. A variable is added to the process of
hashing a transaction that demands that effort before a block can be successfully hashed.
Having a hashed block proves the miner did work and deserves a reward – hence proof of
work.
Public Key
A string which the wallet uses to communicate with nodes and other wallets. The public key
can be shared. It is derived from the private key, in a way that does not disclose the original
string.
Pump And Dump
The usually coordinated trading event of posting orders to boost a coin, then selling as more
traders join in. Pumps can lift a digital asset and lead to gains of as much as 1,000%. Usually,
liquidity will disappear soon after the pump, leaving late buyers holding a quickly depreciating
asset.
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REKT
Shorthand slang for “wrecked” and a term used to describe a bad loss in a trade.
Satoshi Nakamoto
The individual, or group of individuals – it has never been confirmed – who created bitcoin.
Satoshi / Sats
One hundred millionth part of one whole Bitcoin. Named after the creator of the Bitcoin
protocol, Satoshi Nakamoto, often abbreviated to “sats”. The importance of “sats” is high to
BTC supporters, expecting one day that a whole BTC will be so valuable that a single satoshi
will be used as a more suitable unit of account.
Seed
A phrase of 12 or 24 words, used to derive a private key. The origin point from which you
created your wallet ID. Usually, a seed is a phrase or a series of words that can be used to
regenerate your wallet ID if you lose it. Something to keep very secret.
Segregated Witness (SEGWIT)
The processes of separating digital signature data from transaction data. This lets more
transactions fit onto one block in the blockchain, improving transaction speeds.
Sharding
Sharding is a way of splitting up the full blockchain history, so each full node doesn’t need the
whole copy of it. It’s considered a scaling solution for blockchains because as they grow
larger, it begins to slow the network performance if every node is required to carry the full
blockchain.
Shit Coin
No points for guessing this one. It’s a term used to describe a cryptocurrency not expected to
have a positive future.
Smart Contract
When a contract is written in computer code, as opposed to traditional legal language, it is
deemed a smart contract. This programmed contract is set up to execute and carry itself out
automatically under specified conditions. When a smart contract is on the blockchain, both
parties can check its programming before agreeing to it, and then let it do its thing, confident
that it cannot be tampered with or changed. It lets two parties agree to complex terms without
needing to trust each other and without needing to involve any third parties. This functionality
is the defining feature of the Ethereum blockchain.

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Soft Fork
A fork in a blockchain protocol where previously valid transactions become invalid. A soft fork
is backwards-compatible, as the old nodes running the old protocol will still consider new
transactions valid, rather than disregarding them. For a soft fork to work, a majority of the
miners powering the network will need to upgrade to the new protocol.
Software Wallet
A common form of wallet where the private key for an individual is stored within software files
on a computer. This is the system you are likely to use if you sign up for a wallet online that is
not associated with an exchange.
Solidity
A programming language similar to JavaScript but focused on developing smart contracts. It’s
exported as bytecode, which is used by the Ethereum Virtual Machine that runs the Ethereum
network.
Stablecoin
A crypto coin with its value pegged to a fiat currency, most often the US dollar. Stablecoins
are either backed by assets such as fiat, or by cryptocurrencies as collateral. Stablecoins offer
the advantage of moving funds worldwide for trading arbitrage, or to circumvent slow and
expensive bank transfers. Some well known stablecoins are USDT, UST, USDB, BUSD and
DAI.
Ticker
The symbol representing an asset for trading. Cryptocurrency coin and token tickers follow
the three or four-letter format similar to some stocks. BTC is perhaps the most famous ticker,
with an alternative as XBT.
Timestamp
The moment in time when a transaction was encrypted and regarded as proof that the data
compiled in that transaction existed.
Token
A digital asset generated on a second-generation blockchain, such as Ethereum. A token
differs from a coin, as it is not mined, but created through code. Tokens have various
ownership structures and incentives. Examples include locking tokens for rewards, destroying
or burning tokens to make the supply scarcer. Tokens usually require a fee to be sent through
the network.

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Tokenize
Issuing a token to represent value. Tokenizing assets is possible in theory, such as
representing shares, real estate, or bonds. The legal framework surrounding tokenized assets
is still evolving, especially when a token mimics a security. Tokenization attempted to bring
assets not usually available to a potential international pool of buyers.
Transaction Fee
Usually very small fees given to the miners involved in successfully approving a transaction
on the blockchain. This fee can vary depending on the difficulty involved in a transaction and
overall network capabilities at that moment in time. If an exchange is involved in facilitating
that transaction, it could also take a cut of the overall transaction fee.
Trustless
Pertaining to algorithms that achieve transactions traditionally verified by humans. Usually, to
transact in fiat, one needs to trust the goodwill of a bank or another money manager. In
cryptocurrency networks, the transactions are verified in ways that are very difficult to
reverse, and there is no need for a human actor to assure fairness. In fact, most networks are
engineered in ways that even bad actors will not have an impact. A trustless network relies on
mathematical proof to assure fair and irreversible transactions.
Turing Completeness
If a machine is capable of performing all conceivable programmable calculations, then it is
Turing complete. This machine can process any computable function and includes most
modern computers.
Volume
The amount of crypto assets, usually expressed in dollar terms, traded within a specific time
frame. Volume represents the interest of investors in any given pair. In crypto asset trading,
the exact volume is harder to measure. Suspicions arise on possible inflated volumes, or
trades generated by bots.
Volatility
The fluctuation in an asset’s price is measured by its volatility. Cryptocurrency prices are
notoriously volatile compared to other assets, as dramatic price shifts can happen quickly.
Wallet
A wallet is defined by a unique code that represents its “address” on the blockchain. The
wallet address is public, but within it is several private keys determining ownership of the
balance and the balance itself. It can exist in software, hardware, paper, or other forms.

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Whale
A term used to describe extremely wealthy investors or traders who have enough funds to
manipulate the market.
Whitelist
Prior to an ICO, interested parties can sign up/register their involvement and intent to
purchase or even purchase under pre-sale conditions. The list of these parties is referred to
as the whitelist.
White Paper
A detailed explanation of a cryptocurrency, designed to offer satisfactory technical
information, explain the purpose of the coin and set out a roadmap for how it plans to
succeed. It’s designed to convince investors that it’s a good choice ahead of an ICO.
Zero Confirmation Transaction
Alternative phrasing for an unconfirmed transaction.

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