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Crypto glossary
46 terms you will meet in CryptoBorne coverage, explained in plain English. Use the filter or jump to a letter.
A
- Address
- A string of characters, derived from a public key, that identifies where crypto can be sent on a blockchain. Sharing an address is safe; sharing the private key behind it is not.
- Airdrop
- A distribution of tokens to many wallets at once, usually free, to reward early users or spread ownership of a new project. Fake airdrops are a common phishing lure.
- All-time high (ATH)
- The highest price an asset has ever traded at. Its opposite is the all-time low (ATL).
- Altcoin
- Any cryptocurrency other than bitcoin.
- AML / KYC
- Anti-money-laundering and know-your-customer rules. Regulated exchanges must verify customer identities and monitor transactions for illicit funds.
B
- Bear market
- A sustained period of falling prices, often defined as a drop of 20% or more from a recent high. A bull market is the reverse.
- Bitcoin halving
- A pre-programmed event, roughly every four years (every 210,000 blocks), that cuts the bitcoin reward paid to miners per block in half, slowing the rate of new supply.
- Block
- A batch of transactions bundled together and added to a blockchain. Each block references the previous one, forming a chain.
- Blockchain
- A shared, append-only ledger kept in sync by many computers. Once a transaction is confirmed and buried under later blocks, it is very hard to alter.
- Bridge
- Software that moves tokens or data between two blockchains, typically by locking assets on one chain and issuing a representation on the other. Bridges have been the target of some of the largest crypto hacks.
C
- Cold wallet
- A wallet whose private keys are kept offline, such as a hardware device or paper backup. It is harder to hack than a hot (internet-connected) wallet but less convenient.
- Consensus mechanism
- The rules a blockchain's computers use to agree on which transactions are valid and in what order. Proof of work and proof of stake are the two most common.
- Custody
- Who controls the private keys to an asset. With a custodian (such as an exchange) a third party holds them; with self-custody you hold them yourself.
D
- DAO
- A decentralised autonomous organisation: a group that manages funds or a protocol through rules written in smart contracts, with members usually voting using tokens.
- DeFi
- Decentralised finance: lending, trading, borrowing and other financial services run by smart contracts on public blockchains rather than by banks or brokers.
- DEX
- A decentralised exchange, where users trade tokens directly from their wallets through smart contracts instead of depositing funds with a company. A centralised exchange (CEX) holds customer funds.
- Dominance
- One asset's share of the total crypto market capitalisation. Bitcoin dominance is a widely watched gauge of how much money sits in bitcoin versus other coins.
E
- ETF
- An exchange-traded fund. A spot bitcoin or ether ETF holds the actual coins and lets investors gain exposure through an ordinary brokerage account.
F
- Fear & Greed Index
- A 0–100 sentiment score for the crypto market published by alternative.me, built from volatility, momentum, social media and other inputs. Low readings signal fear; high readings signal greed.
- Fork
- A change to a blockchain's rules. A soft fork is backward-compatible; a hard fork is not and can split a chain in two if not everyone upgrades.
G
- Gas
- The fee paid to process a transaction or run a smart contract on networks such as Ethereum. It rises when the network is busy.
H
- Hash rate
- The total computing power securing a proof-of-work network such as Bitcoin. A higher hash rate makes the network more expensive to attack.
L
- Layer 1
- A base blockchain, such as Bitcoin, Ethereum or Solana, that settles its own transactions.
- Layer 2
- A network built on top of a layer 1 to make transactions faster and cheaper, while relying on the base chain for security. Rollups such as Arbitrum and Base are examples.
- Liquidation
- The forced closing of a leveraged position when losses eat through the trader's collateral. Large waves of liquidations can accelerate price moves.
- Liquidity
- How easily an asset can be bought or sold without moving its price. Deep liquidity means tight spreads and less slippage.
M
- Market capitalisation
- Price multiplied by circulating supply. It is the usual way to rank cryptocurrencies by size.
- Memecoin
- A token driven mainly by internet culture and community rather than a product or cash flow. Memecoins are typically highly volatile.
- Mining
- The process in proof-of-work blockchains where computers compete to add the next block and earn newly issued coins plus fees.
N
- NFT
- A non-fungible token: a unique on-chain token that records ownership of a specific item, such as artwork, a collectible or a ticket.
O
P
- Private key
- The secret number that controls a crypto address. Anyone who has it can move the funds, and losing it usually means losing access for good.
- Proof of stake
- A consensus mechanism where validators lock up (stake) coins for the right to propose and confirm blocks, and can lose part of that stake for misbehaving. Ethereum has used it since 2022.
- Proof of work
- A consensus mechanism where miners spend computing power to solve puzzles and add blocks. Bitcoin uses it.
R
- Rug pull
- A scam where a project's creators drain its funds or liquidity and disappear, leaving token holders with worthless assets.
S
- Seed phrase
- A list of 12 or 24 words that can recreate a wallet's private keys. Anyone asking for your seed phrase is trying to steal your funds.
- Slippage
- The difference between the price you expect and the price you get, usually caused by thin liquidity or fast-moving markets.
- Smart contract
- A program stored on a blockchain that runs automatically when its conditions are met. Smart contracts power DeFi, NFTs and most tokens.
- Stablecoin
- A token designed to hold a steady value, usually $1, backed by cash and short-term government debt (like USDT and USDC), by other crypto, or by an algorithm.
- Staking
- Locking up coins to help secure a proof-of-stake network in return for rewards. Staking through a third party adds that party's risk.
T
- Token
- A digital asset issued on an existing blockchain, as opposed to a coin that is native to its own chain. USDC and UNI are tokens on Ethereum.
- Total value locked (TVL)
- The value of crypto deposited in a DeFi protocol or chain. It is a rough gauge of how much a protocol is used.
V
- Validator
- A participant in a proof-of-stake network that stakes coins and runs software to propose and attest to new blocks.
W
Definitions are written by the CryptoBorne editors for general education. They are not investment, legal or tax advice. Spotted an error? Contact the newsroom.