Crypto Terminology
In this guide, we’ll introduce the most important terms every beginner in the world of cryptocurrencies should know. Before embarking on your crypto journey, familiarizing yourself with key concepts you’ll encounter repeatedly—whether trading, investing, or simply exploring the topic—will be immensely helpful. This glossary will help you navigate the crypto world with greater confidence.
AAccumulation
The process of gradually building a position in an asset by buying over time, often in anticipation of a price increase.
The process of gradually building a position in an asset by buying over time, often in anticipation of a price increase.
Airdrop
Free distribution of tokens by a project to users, often as part of a marketing campaign or to reward loyal participants.
Air Gapping
Security through physical isolation, such as storing a wallet offline without any internet connection.
All Time High (ATH)
The highest price a cryptocurrency has ever reached in its history.
Altcoin
Any cryptocurrency that is not Bitcoin, such as Ethereum, Solana, Litecoin, etc.
AML (Anti-Money Laundering)
Legislative measures to combat money laundering.
Arbitration
Profiting from price differences between exchanges by buying low on one and selling high on another.
BBag Holder
An investor who holds an asset despite a significant price drop.
Bear Market
A period of prolonged price declines with negative market sentiment.
Bear Trap
A temporary price drop that misleads traders into expecting further declines, followed by a sharp rise.
Bearish
Expecting prices to fall. Opposite of bullish.
Bid / Ask
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Bid: The price a buyer is willing to pay.
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Ask: The price a seller is willing to accept.
Bitcoin
The first cryptocurrency, created in 2009 by Satoshi Nakamoto, often referred to as “digital gold.”
Bitcoin Maximalist
Someone who believes only Bitcoin has value and considers other cryptocurrencies unnecessary.
Block
A group of confirmed transactions recorded in a blockchain. Each new block is linked to the previous one.
Blockchain
A decentralized ledger of blocks that securely and transparently records all transactions.
Block Reward
The reward miners receive for successfully adding a new block.
Block Height
The number of blocks in the blockchain, starting from the first (genesis block).
Block Size Limit
The maximum data size a single block can contain.
Bollinger Bands
A technical volatility indicator used to identify potential market entry/exit points.
Bull Market
A market with sustained price increases, typically driven by high demand and optimism.
Bull Trap
A temporary price rise that misleads bullish traders, followed by a sharp drop.
Bullish
Expecting a price increase for an asset.
CCentralised
A system controlled by a single entity, opposite to the decentralization in crypto.
Consensus
Agreement among network participants that a transaction is valid.
Consolidation
A period when prices move sideways without a clear trend.
Correction
A short-term price decline following a strong upward movement, considered a normal part of the market cycle.
Cryptoart
Digital art, often existing as an NFT, that can be traded.
Cryptocurrency
A digital currency using cryptography for security, typically decentralized.
Cryptoeconomics
The combination of economics and cryptography, forming the basis of blockchain technology design.
Cryptography
Encoding information for security, a core technology behind cryptocurrencies.
DDaily Trading
Trading where positions are opened and closed within the same day.
DAO (Decentralised Autonomous Organisation)
A decentralized organization managed by code and community voting through tokens.
DApps (Decentralised Applications)
Applications running on a blockchain without centralized control.
DCA (Dollar-Cost Averaging)
A strategy of investing a fixed amount at regular intervals, regardless of price, to average the entry cost.
Decentralised
A system without a central authority, with control distributed among participants.
Decentralised Exchange (DEX)
An exchange allowing direct trading between users without intermediaries.
Decentralised Finance (DeFi)
Financial services built on blockchain, operating without intermediaries like banks, enabling lending, trading, saving, and more through smart contracts and decentralized applications (DApps).
Derivatives
Financial instruments whose value is based on the movement of another asset, such as Bitcoin.
Distributed Ledger
A ledger stored across multiple devices, ensuring transparency and decentralization.
Double-Spend
An attempt to reuse the same cryptocurrency, prevented by blockchain verification.
Dumping
Mass selling of an asset, typically leading to a price drop.
DYOR (Do Your Own Research)
Advice to investors: conduct your own research before investing.
EEntry / Exit Points
The moments when a trader decides to enter or exit a position.
ERC-20
A standard for creating tokens on Ethereum, ensuring compatibility with smart contracts.
Ethereum Virtual Machine (EVM)
Technology that executes smart contracts on Ethereum, ensuring compatibility and security.
Etherscan
A website for tracking Ethereum transactions, wallets, smart contracts, and other network data.
Exchange
An online platform for buying, selling, and exchanging cryptocurrencies, e.g., Binance, Coinbase, Altcoins.bg.
ETF (Exchange-Traded Fund)
An investment fund traded on an exchange like a stock, combining various assets—stocks, bonds, or cryptocurrencies—into a diversified portfolio. Buying a BTC ETF means you don’t directly own Bitcoin but invest in a security tracking its price movement.
FFear and Greed Index
An indicator showing market sentiment—fear (low interest) or greed (high interest).
Fiat Currency
Traditional currency issued by a government, e.g., BGN, USD, EUR.
Fiat Gateway
A service enabling the purchase and sale of crypto against fiat currencies.
Flippening
The moment an altcoin surpasses Bitcoin in market capitalization.
FOMO
Fear Of Missing Out—fear of missing a profitable opportunity, often leading to rushed investments.
Fork
A split in the blockchain due to a change in protocol rules.
FUD
Fear, Uncertainty, Doubt—a strategy to spread fear and insecurity among investors.
FUDster
Someone who deliberately spreads FUD to manipulate the market.
Futures
Contracts for buying or selling at a fixed price in the future, used for hedging or speculation.
GGas
A fee paid for conducting transactions or executing smart contracts on networks like Ethereum.
Genesis Block
The first block in a blockchain network, hard-coded into the protocol and the starting point of every blockchain.
HHalving
A process where the mining reward for adding new blocks is halved, occurring periodically in Bitcoin’s network to limit supply.
Hard Fork
A blockchain split creating a new, independent chain incompatible with the original, e.g., Bitcoin and Bitcoin Cash.
Hardware Wallet
A physical device storing cryptocurrencies offline for enhanced security.
Hash Function
A cryptographic algorithm converting input data into a unique fixed-length output (hash), used to secure blockchain data.
Hedging
A strategy to reduce risk by taking opposing market positions.
HODL
A slang term derived from a misspelling of “hold,” referring to a strategy of not selling despite volatility.
Hot Wallet
A wallet connected to the internet, convenient for quick transactions but less secure.
HTF (High Time Frame)
Charts with longer time periods, e.g., daily, weekly, or monthly.
IICO (Initial Coin Offering)
A fundraising method where a project offers new tokens to the public before listing on an exchange.
IDO (Initial DEX Offering)
Similar to an ICO, but tokens are offered through a decentralized exchange (DEX).
IEO (Initial Exchange Offering)
A token offering organized and conducted by a centralized exchange.
Inflation
A general increase in prices and reduction in a currency’s purchasing power.
KKYC (Know Your Customer)
A client identification process required by regulations, mandatory for most exchanges.
LLambo
A humorous term expressing large profits, e.g., “When will I buy a Lambo?”
Leverage
Using borrowed funds to open a larger position than your available capital, amplifying both profits and risks.
LFT (Low Time Frame)
Charts with short time periods, e.g., 1 to 15 minutes.
Limit Order
An order specifying a price at which you want to buy or sell, executed only if the market reaches that price.
Liquidity
A measure of how easily an asset can be bought or sold without affecting its price.
Liquidation
Forced closure of a position when funds are insufficient to maintain it, often occurring with leverage.
Long
A position expecting the price to rise, buying with the intent to sell at a higher price.
MMargin
The amount required to open a leveraged position.
Market Capitalization
The market value of a cryptocurrency—total tokens in circulation multiplied by the current price.
Memecoin
A cryptocurrency created as a joke or internet meme, e.g., Dogecoin, Shiba Inu.
Mining
The process of creating new cryptocurrencies by solving complex mathematical problems, where miners validate transactions and earn rewards.
Mining Difficulty
A measure of how hard it is to mine a new block, automatically adjusted based on network power.
Mining Rig
A specialized computer system designed for cryptocurrency mining.
Mooning
A sharp price surge, often used in the phrase “To the moon!”
NNFT (Non-Fungible Token)
A unique token that cannot be replaced, commonly used for digital assets like art, music, and collectibles.
Node
A computer in a blockchain network storing a copy of the chain and participating in transaction validation.
OOHLC
Abbreviation for Open, High, Low, Close—indicating the opening, highest, lowest, and closing prices for a period.
Open Interest
The number of active contracts (e.g., futures) that remain open.
PPeer to Peer
Direct trading between users without a central intermediary.
Permissioned Ledger
A distributed ledger accessible only to specific participants.
POW (Proof of Work)
A transaction validation mechanism using mathematical problem-solving, used by Bitcoin.
POS (Proof of Stake)
A validation method where participants stake tokens to earn the right to validate blocks.
Private Key
A secret key granting access to your funds—never share it!
Public Key
A public address for receiving cryptocurrency, safe to share.
Pump and Dump
A manipulation where an asset’s price is artificially inflated, then sold at the peak, causing a crash.
QQuantum-Proof
A blockchain or cryptographic feature resistant to future quantum computer attacks capable of breaking current cryptographic methods.
RRally
A rapid and significant price increase over a short period.
Ransomware
Malware locking your computer or files and demanding ransom, often in cryptocurrency.
Rekt
Slang for a trader who lost a large sum or was liquidated, derived from “wrecked.”
Resistance
A price level where selling pressure is expected, making upward movement difficult.
Return on Investment (ROI)
The profit earned relative to the amount invested.
ROE (Return on Equity)
A measure of how effectively you use your capital in trading.
Rugpull
A scam where developers abandon a project after taking investors’ money.
SSatoshi Nakamoto
The pseudonym of Bitcoin’s unknown creator, whose identity remains a mystery.
Scalability
A blockchain’s ability to handle a large number of transactions without sacrificing speed or security.
Scalping
A trading strategy involving quick market entries and exits for small profits.
Sell
The process of selling cryptocurrency.
Shilling
Excessive promotion of a token or project, often with questionable motives.
Short
A trading position expecting a price drop, profiting from the decline.
Smart Contract
A program that executes automatically when predefined conditions are met, without intermediaries.
SPAC (Special Purpose Acquisition Company)
A company created to acquire another, used to list projects on stock markets.
Spot
Spot trading involves the direct exchange of assets at the current market price. Cryptocurrencies are swapped without using fiat currency, and ownership transfers immediately upon transaction completion.
Spread
The difference between the best buy (bid) and sell (ask) prices.
Stablecoin
A cryptocurrency with a fixed value, often pegged to USD or another asset, to avoid volatility.
Staking
Locking tokens to support a network and earn rewards in return.
Stop Loss
An automatic order to limit losses when the market moves against you.
Support
A price level where buyers are expected to enter, halting a decline.
Swing Trading
Trading where positions are held for days to weeks.
TTA (Technical Analysis)
Studying charts and market data to predict future price movements.
TF (Time Frame)
The time period a single candle on a chart represents, e.g., 1h, 4h, 1d.
Token
A digital unit of value, used as currency, a right to participate, or access to a service.
Tokenomics
The combination of “token” and “economics,” studying how a token’s economy functions.
Total Value Locked (TVL)
The total value of crypto assets locked in a protocol, a key DeFi metric.
Trading Volume (Volume)
The amount of cryptocurrency traded over a period, indicating market activity.
Transaction Fee
A fee paid for conducting a blockchain transaction.
Trustless
A system where participants don’t need to trust each other—security is ensured by the protocol and cryptography.
Two-Factor Authentication (2FA)
Extra login security requiring not only a password but also a second code (SMS, app, etc.).
VvAMM (Virtual Automated Market Maker)
A smart contract that automatically creates a trading market and provides liquidity without real assets.
Volatility
A measure of how quickly and sharply an asset’s price changes. High volatility equals high risks and opportunities.
WWallet
A digital wallet for storing cryptocurrencies, available in various forms—online, hardware, mobile, etc.
Wallet Address
A public address used to receive cryptocurrencies.
Wallet Seed Phrase
A list of words (usually 12 or 24) used to recover your wallet. Store it securely!
Wash Trading
Manipulation where the same party buys and sells to themselves to create artificial activity.
Weak Hands
Investors who sell at the first sign of a downturn, often driven by fear.
Whale
A large investor holding significant amounts of crypto, capable of influencing the market.
Whale Watching
Monitoring whale activity to predict potential large market movements.
Whitepaper
A document outlining a crypto project’s technology, goals, tokenomics, etc. Recommended reading before investing.
ZZero-Knowledge Proof
A technology proving something is true without revealing the information itself.
Zk-SNARKs
A specific type of zero-knowledge proof used for privacy in blockchains, e.g., in projects like Zcash.
If you’ve made it this far, you’re already speaking the “crypto” language much more fluently!
We hope you now feel more confident when hearing terms like staking, pump and dump, rugpull, DEX, TVL, and others.
If this article was helpful:
Share it with friends entering the crypto world. Save it—you’ll need it often!If you’re just starting in cryptocurrencies and unsure where to begin, we recommend reading these articles:
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Until the next article, and don’t forget: DYOR and HODL!
