This guide explains core crypto terms in clear, concise language so you can navigate cryptocurrency, Bitcoin, and blockchain discussions with confidence.
Understanding crypto terminology helps you evaluate risks, follow transactions accurately, and participate more safely.
How to Use This Glossary?
Scan the headings to find a definition fast. Each entry summarizes a key concept, then adds context about how it appears in the cryptocurrency market or a typical transaction.
Key Concepts and Jargon
Entries keep technical detail brief and practical.
| Term | Definition | Example/Context |
|---|---|---|
| Tokens | Digital assets created and managed on a blockchain, often through a smart contract. | An ERC-20 token used in a DeFi app. |
| Wallets | Apps or devices that manage keys and let you send and receive crypto. | A mobile wallet for everyday payments or a hardware wallet for long-term storage. |
| Ethereum Ecosystem | The collection of apps, tokens, tools, and users that operate on Ethereum. | Using a decentralized exchange or minting an NFT on Ethereum. |
| Smart Contracts | On-chain programs that automatically execute rules when conditions are met. | A lending protocol that uses code to manage collateral and repayments. |
| Blockchain Network | A distributed system of nodes that maintains a shared ledger of transactions. | Broadcasting a transaction and waiting for confirmations. |
- Tokens: Assets you’ll see referenced often in crypto discussions.
- Wallets: Tools you’ll see mentioned when people talk about storing and sending crypto.
- Ethereum ecosystem: Common references to Ethereum-based apps, tokens, and activity.
- Smart contracts: The programs behind many on-chain actions and services.
- Blockchain network: The underlying system that records and verifies transactions.
Altcoins
Any digital currency other than Bitcoin. Each network has its own rules, features, and purposes, and may be a fresh protocol or a fork of an existing cryptocurrency.
All-Time High / All-Time Low
The record peak price and record bottom price reached by a specific asset over its entire trading history.
Bull Market
A sustained period when prices broadly rise and sentiment is optimistic.
Bear Market
The opposite of a bull phase, marked by declining prices and negative outlooks.
Blockchain
A distributed ledger that stores data across many computers. Operated by miners or validators, it removes the need for a central intermediary by replicating and syncing records on a decentralized network.
Block
A batch of confirmed transactions bundled together. Each block links to the previous one with a cryptographic hash, making past records extremely hard to alter.
Block Reward
Newly created coins paid to miners or validators when they produce a valid block, aligning incentives to secure and operate the network.
Consensus
The process nodes use to agree on which transactions enter the ledger. The two most common mechanisms today are proof-of-work (PoW) and proof-of-stake (PoS).
Cryptography
The discipline of securing information. In crypto assets it underpins PoW via the SHA-256 hash function and enables digital signatures with public-key and private-key pairs for transaction authentication.
DApp
Decentralized application. Software that runs on a blockchain and relies on smart contracts to deliver trust-minimized services. Ethereum hosts hundreds of these apps.
DAO
Decentralized autonomous organization. A collectively governed entity whose rules live in smart contracts, often allowing token holders to vote on upgrades and product direction.
Decentralized
Describes systems that distribute control across many nodes to raise security and resilience and to reduce dependence on central authorities.
DeFi
Decentralized finance. A set of on-chain protocols offering services like borrowing, lending, trading, and yield. Commonly built on Ethereum, DeFi stacks smart contracts that encode how user funds move through each function.
DYOR
Do your own research. A reminder to verify claims, check sources for bias, and rely on your due diligence rather than influencers or headlines.
ERC-20
Ethereum’s standard for fungible tokens. It defines common rules so new digital currencies work seamlessly with existing wallets, exchanges, and tools.
ERC-721
Ethereum’s standard for non-fungible tokens (NFTs). It enables unique, non-interchangeable assets for collectibles, in-game items, and tokenized one-of-a-kind objects.
EVM
Ethereum Virtual Machine. A global, blockchain-anchored runtime that executes smart contracts and powers decentralized applications.
Fiat
Government-issued money such as the US dollar or euro. Converting to or holding fiat within the crypto ecosystem usually involves a centralized custodian.
Fork
A protocol change that splits a chain. Hard forks are not backward-compatible and can result in a new currency; soft forks tighten or adjust rules and require broad network support.
FOMO
Fear of missing out. Anxiety felt when assets you do not own rally sharply.
FUD
Fear, uncertainty, and doubt. Information that encourages a negative market view.
Fundamental Analysis
A valuation approach that examines a project’s technology, team, token design, and use cases to estimate intrinsic value and future performance.
Gas
The execution fee on Ethereum for sending a transaction or running a smart contract. Gas fees are the cost users pay to have their transactions processed on the network, and they can change based on network demand. Gas is typically denominated in Gwei, a small unit of Ether (ETH).
Gwei
A denomination of Ether. One ETH equals 10^18 wei; one Gwei equals 10^9 wei.
Halving
The scheduled 50% reduction of Bitcoin’s block subsidy every 210,000 blocks (about four years). The reward began at 50 BTC per block and, after three halvings, reached 6.25 BTC.
Hash Rate
The amount of hashing computations performed per second on a network like Bitcoin. One terahash equals one trillion hashes each second.
HODL
Slang born from a misspelling of “hold.” It means keeping your coins through volatility rather than selling with the crowd.
KYC
Know Your Customer. The regulatory process where financial services collect and verify user identity at onboarding, as required by authorities in relevant jurisdictions.
Ledger
A record of transactions. In cryptocurrencies, the blockchain is the ledger that tracks every transfer for a particular cryptocurrency.
Liquidity
Either the ease of buying or selling an asset without large price impact, or the pool of tokens available on a decentralized exchange for traders to swap against.
Limit Order
An instruction to execute a trade at a specified price or better. Buy limits fill at the limit price or lower; sell limits fill at the limit price or higher.
Margin Trading
Trading with borrowed funds. It increases position size and can amplify gains, but it also magnifies losses and overall risk relative to spot trading.
Market Cap
Market capitalization. Calculated as price multiplied by circulating supply, it offers a snapshot of an asset’s total network value and project scale.
Mining
The act of providing computational power to a blockchain to create new blocks. Miners are rewarded for contributing security and verification.
Mining Pool
A collective of miners who combine hash power to stabilize earnings and improve their chance of producing valid blocks on proof-of-work networks.
NFT
Non-fungible token. A unique token standard used on Ethereum and other chains that can represent ownership of a one-of-a-kind digital or real-world asset. NFTs can move between wallets and interact with smart contracts but are not interchangeable; common use cases include digital art, collectibles, and in-game items. Notable sales on marketplaces like OpenSea have reached millions.
Network Fees
Payments attached to transactions on Bitcoin, Ethereum, and similar networks. These fees incentivize miners or validators to process transactions and help secure the chain.
Node
A participant that stores blockchain data and takes part in validation. Miners are full nodes, and anyone can run a node to monitor the network without dedicating mining resources.
Nonce
A number miners vary in proof-of-work systems to discover a hash below the network target. In Bitcoin, the SHA-256 output must have a certain number of leading zeros, which adjusts to regulate block production speed.
Paper Wallet
An offline method where private keys are printed or written on paper to reduce online exposure. Today it is considered risky due to insecure key generation and handling, often via centralized websites or software interfaces.
Price Tracking in USD
Ways to check the current cryptocurrency price in US dollars. Common options include price trackers like CoinMarketCap and CoinGecko, exchange apps and websites that show live order books, and some wallet apps that display a fiat value next to your balances. Prices fluctuate in real time and can differ slightly across venues based on liquidity and trading activity.
Private Key
A secret value proving ownership of a wallet. Anyone with the private key can authorize transfers from the associated address.
Proof-of-Stake
A consensus model where participants lock up cryptocurrency as stake to be selected to propose and validate blocks, earning rewards for securing the network.
Proof-of-Work
A consensus model using miners who expend computing power to solve a hashing puzzle. The first to find a valid result appends the block and receives rewards.
Public Key
Generated with the private key as a pair and processed to create the wallet address. It is safe to share and used to receive funds.
Seed Phrase (Recovery Phrase)
A set of words that acts as the master backup for a wallet, sometimes called a recovery phrase. Most wallets use standardized word lists (commonly BIP39) and generate phrases that are typically 12 or 24 words long because those lengths map to specific amounts of underlying randomness (entropy), with 24 words generally providing more security margin than 12. The seed phrase can recreate your private keys and addresses, so it is what you use to restore access if your phone, computer, or hardware wallet is lost or damaged.
Treat a seed phrase like the keys to your funds: never share it, never type it into random websites, and be wary of anyone asking for it (including “support” messages). Store it offline in a secure location (many people use a written backup or a durable metal backup), and consider keeping backups in separate places to reduce the risk of loss.
Sats or Satoshis
The smallest unit of Bitcoin: 0.00000001 BTC. Named after Satoshi Nakamoto; 100,000,000 sats equal 1 BTC.
SegWit
Segregated Witness, a Bitcoin upgrade from August 2017 that moved signature data outside the base transaction to fit more transactions per block.
SHA-256
A one-way hashing algorithm that converts any input into a fixed-length digest. Many blockchains rely on it for proof-of-work and data verification.
Smart Contracts
Programs deployed to blockchains. Platforms like Ethereum let developers build transparent tools and services that transact with crypto assets automatically.
Solidity
A high-level programming language for writing smart contracts. Co-created by Gavin Wood, it enables developers to build immutable applications.
Stablecoins
Cryptocurrencies designed to keep a relatively steady value, often by targeting a peg to an asset like the US dollar. Some stablecoins aim to maintain that peg through reserves held by an issuer (for example, USDT and USDC), while others use on-chain mechanisms to manage supply and demand (for example, DAI).
Stablecoins are commonly used for trading (moving in and out of volatile assets), sending payments with less price risk, holding value between trades, and using DeFi apps where a more stable unit of account is helpful.
TA or Technical Analysis
The study of price charts and indicators to assess market conditions and attempt to forecast future moves, widely practiced by active traders.
Testnet
A development network that mirrors mainnet behavior for testing. On Ethereum and Binance Smart Chain testnets, tokens are valueless and obtainable from faucets to trial deployments safely.
Token
An asset issued via a smart contract, commonly on the Ethereum blockchain. Many leading assets by market cap are ERC-20 tokens rather than native coins.
UTXO
Unspent Transaction Output model. Wallet balances are computed as the sum of unspent outputs tied to an address, not stored as a single balance variable.
Validators
Participants in proof-of-stake networks who verify transactions and secure the chain. They earn rewards, and selection is typically influenced by the amount of cryptocurrency they stake.
Volatility
The degree to which an asset’s price fluctuates. Bitcoin and other crypto assets are known for high volatility, which can be attractive to traders.
Wallet
Software or hardware that manages private keys and provides an interface to send and receive funds. A wallet does not “store” cryptocurrency itself; it stores the keys that let you access and control funds recorded on the blockchain. Wallets can be custodial or non-custodial based on who controls the keys, and common types include hot wallets (software on a phone or computer) and cold wallets (offline storage like hardware devices or paper).
Whale
Slang for a market participant with large holdings or order sizes, such as institutions, hedge funds, or wealthy individuals.
White Paper
An in-depth document explaining a project’s technology, implementation plan, purpose, and potential, used to inform users and prospective investors.
