Crypto Glossary

The vocabulary of crypto and blockchain, defined in plain language.

Address: A public string, like an account number, used to receive cryptocurrency. Safe to share.
Altcoin: Any cryptocurrency other than Bitcoin.
AMM (Automated Market Maker): Software that sets prices and enables trading on a decentralized exchange using liquidity pools instead of an order book.
Arbitrage: Profiting from the same asset being priced differently on two venues. See our guide on crypto arbitrage.
Bear / Bull market: A bear market trends down; a bull market trends up.
Block: A bundle of transactions added to the blockchain as a single unit.
Blockchain: A shared, append-only ledger maintained by many computers, secured by cryptography.
CBDC: Central Bank Digital Currency — a digital form of national money issued and controlled by a government.
CEX: Centralized Exchange — a company-run trading platform that typically holds your funds.
Cold wallet: A wallet kept offline for maximum security. See hot vs. cold wallets.
Consensus: The process by which a network agrees on the valid state of the blockchain (e.g., proof of work, proof of stake).
Custodial: When a third party holds your private keys for you. The opposite of self-custody.
DeFi: Decentralized Finance — financial services (lending, trading) built on blockchains without traditional intermediaries.
DEX: Decentralized Exchange — peer-to-peer trading via smart contracts, where you keep custody of funds.
Fiat: Government-issued money such as dollars, euros, or pounds.
Fork: A change to a blockchain's rules; a hard fork can split a network into two.
Gas: A fee paid to process a transaction or run a smart contract on a network.
Hot wallet: A wallet connected to the internet — convenient but more exposed.
KYC: Know Your Customer — identity verification required by regulated services.
Liquidity: How easily an asset can be bought or sold without moving its price.
Market cap: The total value of a coin's circulating supply (price × supply).
Mining: Using computing power to validate transactions and secure a proof-of-work network, earning rewards.
Node: A computer that stores and helps verify a copy of the blockchain.
Private key: The secret that controls your crypto. Whoever holds it controls the funds — never share it.
Proof of Stake: A consensus method where validators lock up coins as collateral to secure the network.
Proof of Work: A consensus method where miners solve puzzles to add blocks (used by Bitcoin).
Rug pull: A scam where creators hype a project, take investors' money, and disappear.
Seed phrase: A set of (usually 12 or 24) words that backs up and can restore a wallet. Guard it offline.
Slippage: The difference between the expected and actual price of a trade, common in thin markets.
Smart contract: Self-executing code on a blockchain that runs automatically when conditions are met.
Stablecoin: A token designed to hold a steady value, usually pegged to a fiat currency like the US dollar.
Staking: Locking up coins to help secure a proof-of-stake network, often earning rewards.
Stop-loss: An order that automatically sells if the price falls to a set level, to limit losses.
Token: A crypto asset built on top of an existing blockchain (e.g., on Ethereum).
Volatility: How sharply an asset's price swings. Crypto is highly volatile.
Wallet: Software or hardware that stores the keys controlling your crypto.
Whale: An individual or entity holding a very large amount of a cryptocurrency.