Crypto Glossary
Crypto Glossary
Explore our concise A–Z to decode on-chain terminology. Clear, consistent definitions built for readers, editors, and builders.
A-Z in Crypto
Account Abstraction (ERC-4337): Smart-account framework enabling gas sponsorship, session keys, and programmable permissions.
Address: Unique string identifying where crypto can be sent or received on a chain.
Airdrop: Token distribution to wallets, often for growth, governance, or loyalty rewards.
Algorand (ALGO): Scalable L1 with fast finality and smart contract support.
AMM (Automated Market Maker): DEX model pricing assets via formulas instead of order books.
API: Software interface allowing apps, wallets, and services to communicate programmatically.
APR: Annualised simple return; excludes compounding effects.
APY: Annual percentage yield including compounding.
Arbitrage: Profit from price differences across markets or chains.
Atomic Swap: Cross-chain exchange using HTLCs without a trusted intermediary.
Attestation: Signed proof asserting a fact (identity, data) on or for the chain.
Auditing: Security review of code and systems to find vulnerabilities before deployment.
AVS (Actively Validated Service): Service secured by restaked validators (e.g., via EigenLayer).
ATH (All-Time High): The highest traded price an asset has reached.
Base Fee: Protocol-set minimum gas component introduced by EIP-1559; burned on Ethereum.
Batch Auction: Mechanism executing orders simultaneously to reduce MEV (e.g., CoW Protocol).
Bear Market: Prolonged period of broadly falling crypto prices and sentiment.
Basis (Perps): Gap between perpetual futures and spot price; linked to funding.
Bitcoin (BTC): First cryptocurrency enabling peer-to-peer, non-sovereign digital money.
Block: Batched transactions confirmed and linked cryptographically to prior blocks.
Block Explorer: Tool to inspect blocks, transactions, addresses, and contract states.
Block Height: Number of blocks preceding the current block in a chain.
Block Reward: Incentive paid to miners/validators for producing a block.
Blockchain: Distributed ledger secured by cryptography and consensus.
BLS Signature: Aggregatable signature scheme useful in PoS systems.
Bonding Curve: Formula setting token price based on supply changes.
Bridge: Protocol to move assets or data across chains; carries security risk.
BRC-20: Experimental fungible token standard using Bitcoin inscriptions.
Bull Market: Period of rising prices, liquidity, and optimistic sentiment.
Burning: Permanently removing tokens from circulation by sending to irretrievable addresses.
Cardano (ADA): Research-driven L1 with staking and eUTXO smart contracts.
CCIP: Chainlink cross-chain messaging and token transfer framework.
CDP: Collateralised debt position minting a stable asset against posted collateral.
CELestia / DA Layer: Chains specialised for data availability to scale rollups.
CEX: Centralised exchange that custodies user funds and order books.
CID (IPFS): Content ID addressing data by its hash, not location.
CLMM: Concentrated-liquidity AMM where LPs pick price ranges (Uniswap v3).
Cold Wallet: Offline wallet for long-term storage and reduced attack surface.
Composability: Protocols interoperate like “money legos” to build complex apps.
Consensus Mechanism: Method nodes use to agree on ledger state (PoS, PoW).
Cross-Margin: Margin shared across positions; reduces liquidation risk per-position.
Crypto-Native Risk: Smart contract and protocol risks unique to on-chain systems.
Custodial Wallet: Wallet where a third party controls the private keys.
Chainlink (LINK): Oracle network delivering external data to smart contracts.
DA (Data Availability): Assurance that block data is published for verification.
DAO: On-chain organisation governed by token holders or members.
DApp: Decentralised application interacting with smart contracts.
Danksharding: Ethereum roadmap for scalable data via blobs and PBS.
Delegated Staking: Assign stake to a validator without running your own.
DEX: Non-custodial exchange governed by contracts and LPs.
DEX Aggregator: Router sourcing liquidity and best prices across many DEXs.
Derivatives: Contracts deriving value from underlying assets or indexes.
Digital Signature: Cryptographic proof of message authorship and integrity.
Distributed Ledger: Shared database replicated across many nodes.
Dogecoin (DOGE): Meme-based cryptocurrency with broad community appeal.
Double Spending: Illicit attempt to spend the same coins more than once.
Dusting Attack: Tiny transfers used to deanonymise or bait approvals.
DVN / DON: Decentralised oracle/validation networks providing verified data.
ECDSA: Signature scheme used by Bitcoin/Ethereum EOAs.
EIP-1559: Introduced base-fee burn and fee-market changes on Ethereum.
EIP-4844 (Proto-Danksharding): Adds blob data for cheaper L2 posting.
ENS: Human-readable names mapped to addresses and resources.
Epoch: PoS period used for rewards, validator duties, or finality checkpoints.
EigenLayer / Restaking: Re-use staked ETH/LSTs to secure AVSs for extra yield.
ERC-20: Fungible token standard on Ethereum and EVM chains.
ERC-721: Non-fungible token standard for unique assets.
Ethereum (ETH): Smart-contract L1 with the largest developer ecosystem.
Ethereum Classic (ETC): Chain preserving immutability after the DAO fork.
Escrow: Conditional custody releasing funds when criteria are met.
EVM: Runtime executing smart contracts across EVM-compatible chains.
Exchange: Venue to buy, sell, or trade cryptoassets and derivatives.
Fiat Currency: Government-issued money like USD, EUR, GBP, or JPY.
Finality: Point when a block becomes economically or cryptographically irreversible.
Filecoin (FIL): Decentralised storage network with cryptoeconomic incentives.
Flash Loan: Uncollateralised loan repaid within one atomic transaction.
FOMO: Fear of missing out leading to reactive trading decisions.
Fork: Protocol change or codebase divergence creating new chain rules.
Fraud Proof: Optimistic rollup mechanism to challenge invalid state transitions.
Funding Rate: Payments between perp longs/shorts aligning price with spot.
Front-Running: Reordering to profit ahead of a victim trade (MEV tactic).
Gas: Fee paid to execute transactions and smart-contract operations.
Gas Limit: Maximum computational steps a transaction can consume.
Genesis Block: The chain’s very first block; height zero.
Gnosis Safe (Safe): Widely used multisig smart wallet for teams and DAOs.
Governance Token: Token granting voting rights over protocol parameters and treasury.
GraphQL / Indexers: Infrastructure indexing chain data for fast structured queries.
Halving: Scheduled reduction of mining rewards (Bitcoin ~ every four years).
Hard Fork: Non-backwards-compatible protocol change requiring node upgrades.
Hashrate: Total compute securing a PoW network; higher is generally safer.
Health Factor: Lending metric indicating proximity to liquidation risk.
HODL: Community term for long-term holding through volatility.
Hot Wallet: Internet-connected wallet for active transactions and dapps.
HTLC: Hashed time-locked contract enabling atomic swaps and LN payments.
Hybrid AMM: AMM combining invariants for stable and volatile asset pairs.
IBC: Cosmos protocol for secure cross-chain messaging and asset transfer.
ICO / IEO / IDO: Token sales via websites, exchanges, or DEX launchpads.
Immutable: Data cannot be altered once finalised on the ledger.
Impermanent Loss: Opportunity cost LPs face when prices move versus holding.
Indexer: Service organising chain data into query-friendly formats.
Intents: Users specify outcomes; solvers compete to fulfil them efficiently.
Insurance Fund: Backstop capital absorbing losses before auto-deleverage.
Interoperability: Apps and chains working together across ecosystems.
Isolated Margin: Margin ring-fenced per position to cap risk.
JAM Attack: Mempool spam saturating blockspace to manipulate ordering/fees.
JIT Liquidity: Liquidity added around anticipated trades in CLMMs.
JOMO: Joy of missing out—comfort in skipping risky trades or hype.
Keystore: Encrypted file that stores a private key for wallet access.
KYC: Identity verification required by many regulated platforms.
KZG Commitments: Polynomial commitments used for EIP-4844 blob proofs.
Layer 1: Base blockchain such as Bitcoin, Ethereum, or Solana.
Layer 2: Scaling networks built on L1s for cheaper, faster transactions.
LBP: Liquidity bootstrapping pool with shifting weights for fair launches.
Lightning Network: Bitcoin’s off-chain payment channels for instant, low-fee transfers.
Limit Order: Instruction to trade at a specified price or better.
Liquidation: Forced closure when collateral falls below safety thresholds.
Liquid Staking Token (LST): Tokenised claim on staked assets (e.g., stETH).
Liquidity: Ability to trade size with minimal price impact/slippage.
LTV: Loan-to-value ratio measuring borrow size versus collateral value.
LVR: Loss vs rebalancing—systematic LP loss as prices move.
LP Token: Receipt token representing a share of a liquidity pool.
Maker/Taker: Liquidity provider versus liquidity consumer in markets.
Margin: Collateral securing leveraged positions on exchanges or protocols.
Mempool: Queue of pending transactions awaiting inclusion; fees and tips influence ordering.
Merkle Tree: Hash tree enabling efficient proofs of inclusion and state.
MEV: Value captured by reordering, inserting, or censoring transactions.
MEV-Boost: Proposer-builder separation to reduce censorship and centralisation.
MetaMask: Popular EVM wallet and dapp gateway for browsers and mobile.
Mining: PoW process securing networks and issuing new coins.
Minting: Creating new tokens or NFTs according to contract rules.
MPC Wallet: Multi-party computation wallet splitting cryptographic actions.
Multisig: Wallet requiring multiple signatures to authorise transfers.
Market Cap: Price multiplied by circulating supply of a cryptoasset.
Native Bridge: Canonical bridge maintained by an L1/L2 stack.
Network Effects: Protocol utility increases as more participants join.
NFT: Unique token representing ownership, rights, or identity.
Node: Machine participating in consensus, validation, and data propagation.
Nonce: Counter used to order and prevent replay of transactions.
NVT Ratio: Network value to on-chain transaction value; rough valuation metric.
OCR: Off-chain reporting that aggregates oracle data before posting on-chain.
On-Chain Governance: Voting on protocol parameters and upgrades on-chain.
Open Interest: Total outstanding derivative contracts not yet settled.
OpenSea: Major marketplace for NFTs across EVM chains.
Optimistic Rollup: L2 assuming validity unless fraud proofs challenge state.
Options: Derivatives granting rights to buy or sell at a strike price by expiry.
Oracle: Service delivering external data (prices, events) to smart contracts.
PBS: Proposer-builder separation to mitigate MEV and promote competition.
Perpetual Futures: Futures without expiry; funding keeps price near spot.
Price Impact: Deviation from expected price due to trade size and depth.
Priority Fee (Tip): Extra gas to incentivise inclusion and ordering.
Private Key: Secret enabling full control over an address and funds.
Proof of Reserves: Attested or cryptographic proof of custodied assets vs liabilities.
Proof of Stake: Validators stake assets to secure the network and earn rewards.
Proof of Work: Miners expend energy on puzzles to secure the network.
Public Key: Public identifier derived from a private key.
PWAs / WalletConnect: Patterns for connecting wallets to web and mobile apps.
P2P: Direct interaction between participants without intermediaries.
Quadratic Voting: Voting costs grow with the square of votes to limit dominance.
QR Code: Scannable code for addresses, invoices, or wallet connections.
Quorum: Minimum participation required for a vote to be considered valid.
Rebase Token: Token that periodically expands or contracts supply to target a price.
Reentrancy: Vulnerability allowing untrusted re-entry before state updates finish.
Request for Quote (RFQ): Off-chain quote model used by aggregators and makers.
Restaking: Re-use staked assets to secure additional services or networks.
Ripple (XRP): Payment network and digital asset enabling fast settlements.
Roadmap: Planned development milestones and delivery timeline.
Rollup: L2 posting proofs/data to L1 for security inheritance.
Router: Contract routing trades or liquidity across pools/DEXs.
Rug Pull: Malicious team drains liquidity/treasury and abandons the project.
RWA: Tokenised claims on off-chain assets like treasuries or property.
Sandwich Attack: MEV tactic placing trades before and after a victim trade.
Sat: Satoshi, the smallest unit of BTC (1 BTC = 100,000,000 sats).
Satoshi Nakamoto: Pseudonymous creator(s) of Bitcoin.
Scalability: Network capacity to handle greater usage at acceptable cost.
SBT (Soulbound Token): Non-transferable token representing credentials or identity.
Schnorr Signatures: Signature scheme enabling aggregation and improved privacy.
Seed Phrase: Human-readable recovery words encoding wallet keys.
Sequencer: L2 component that orders transactions and produces L2 blocks.
Session Keys: Temporary permissions for account-abstraction smart wallets.
Sharding: Partitioning data/processing across subsets for scalability.
Shiba Inu (SHIB): Meme coin that evolved into a broader ecosystem.
Slippage: Difference between expected and executed trade price.
Smart Contract: Code that self-executes agreements and program logic on-chain.
Solana (SOL): High-throughput L1 using PoH and parallel execution.
Stablecoin: Token pegged to a reference like USD through collateral or algorithms.
StableSwap Invariant: AMM formula optimised for correlated assets like stables.
Staking: Locking assets to secure a network and earn rewards.
Snapshot: Off-chain governance voting platform for DAOs.
Taproot: Bitcoin upgrade enabling better privacy, scripting, and multisig via Schnorr.
Tick (CLMM): Discrete price step; LP ranges are defined by tick boundaries.
Timelock: Smart-contract feature delaying actions until a set time.
Token: On-chain asset representing value, access, or rights in a system.
Tokenomics: Design covering supply, distribution, incentives, and utility.
Total Value Locked (TVL): Value of assets deposited in a protocol’s contracts.
Travel Rule: Compliance rule requiring sender/receiver info between VASPs.
Trustless: Systems reducing reliance on counterparties through cryptography.
Turing Complete: Capable of any computation given time and resources.
TWAMM: AMM design executing large orders over time to reduce impact.
TWAP / VWAP: Execution strategies averaging by time or volume.
Under-Collateralised Lending: Credit-based lending using reputation or off-chain guarantees.
Uniswap: Leading EVM DEX protocol with AMM and CLMM designs.
Utility Token: Token conferring access or utility inside an ecosystem.
UTXO: Unspent transaction output model used by Bitcoin and similar chains.
Validity Proof: Cryptographic proof (SNARK/STARK) that state transitions are correct.
Validium: ZK system keeping data off-chain while proving validity on-chain.
Validator: PoS participant proposing and attesting to blocks.
Vesting: Token unlock schedule over time, often with a cliff.
Volatility: Degree of price fluctuation measured statistically or implied.
VRF: Verifiable random function providing on-chain randomness.
Wallet: Software or hardware holding keys for transactions and dapps.
Warm Wallet: Semi-online wallet with guarded access for improved security.
Watchlist Address: Address monitored for compliance or security tracking.
Whitepaper: Technical or business overview explaining a project’s design and goals.
Wrapped Token: Representation of an asset in another format or chain (e.g., WETH).
X-Chain: Interactions crossing multiple blockchains or execution environments.
X-Margin: Cross-exchange margin enabled by prime brokers or protocols.
XRP: Asset used within Ripple’s network for cross-border settlement.
Yield Aggregator: Protocol that allocates funds across strategies for best returns.
Yield Curve (On-chain): Relationship between lock duration and return in staking/lending.
Yield Farming: Earning rewards by providing liquidity, lending, or staking assets.
Zcash (ZEC): Privacy-focused coin with shielded transactions using zk-proofs.
ZK-ID: Identity primitives proving attributes privately via zero-knowledge.
ZK Rollup: L2 posting validity proofs to L1 for secure scaling and low fees.
Zk-SNARK: Succinct proof verifying statements without revealing inputs.
Zk-STARK: Transparent, scalable zero-knowledge proof system without trusted setup.
