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Crypto Glossary

51 crypto terms explained in plain English, from airdrop to x402.

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A

Airdrop

Free tokens sent to wallets, usually to reward early users or spread ownership of a new token. Always check an airdrop is real: fake airdrops are a common scam.

All-time high (ATH)

The highest price an asset has ever traded at. Read more →

Altcoin

Any cryptocurrency other than Bitcoin. Read more →

B

Bear market

A long period of falling prices and pessimism. The opposite of a bull market.

Bitcoin halving

An event roughly every four years when the Bitcoin mining reward is cut in half, slowing the creation of new coins. The latest was in April 2024. Read more →

Block

A batch of transactions added to a blockchain at once. Each block links to the one before it, forming a chain.

Blockchain

A shared record of transactions kept by many computers at once, so no single party can secretly change it. Read more →

Bridge

A tool that moves tokens from one blockchain to another. Bridges hold large amounts of funds, which makes them frequent targets for hackers.

Bull market

A long period of rising prices and optimism.

Burn

Permanently removing tokens from circulation by sending them to an address nobody can access. Burns reduce supply. Read more →

C

CBDC

Central bank digital currency: a digital form of a country's official money, issued by its central bank. Read more →

Cold wallet

A wallet kept offline, such as a hardware device. Safer from hackers than a hot wallet, but less convenient.

Custody

Holding crypto on someone's behalf. A custodian, such as an exchange, controls the private keys for you. Read more →

D

DAO

Decentralized autonomous organization: a group that makes decisions through votes recorded on a blockchain, often using tokens.

DeFi

Decentralized finance: lending, borrowing and trading through smart contracts instead of banks or brokers.

Digital commodity

A term US regulators use for some tokens that behave more like commodities than securities, often because no central party controls them. Read more →

DYOR

"Do your own research": a reminder to check facts yourself before investing.

E

ETF

Exchange-traded fund: a fund that trades on a stock exchange. Spot crypto ETFs hold the actual coins, letting people invest through a normal brokerage account. Read more →

EVM

Ethereum Virtual Machine: the system that runs smart contracts on Ethereum. EVM-compatible chains, such as CandyChain, can run the same contracts and tools. Read more →

G

Gas fee

The fee paid to process a transaction on a blockchain such as Ethereum.

H

Hot wallet

A wallet connected to the internet, such as a phone app or browser extension. Convenient, but more exposed to hacks.

I

Inflation (token issuance)

The rate at which new tokens are created. Higher issuance means more new supply, which can dilute existing holders. Read more →

K

KYC

Know your customer: identity checks that regulated exchanges and services must carry out. Read more →

L

Layer 1

A base blockchain that processes and settles its own transactions, such as Bitcoin, Ethereum or CandyChain. Read more →

Layer 2

A network built on top of a Layer 1 to make transactions faster and cheaper, while relying on the Layer 1 for security.

Leverage

Borrowing to make a bigger bet than your own money allows. It multiplies gains and losses. Read more →

Liquidation

When an exchange forcibly closes a leveraged position because the trader's collateral no longer covers losses. Waves of liquidations can speed up price moves. Read more →

Liquidity

How easily an asset can be bought or sold without moving its price much.

M

Market cap

Price multiplied by the number of coins in circulation. A rough way to compare the size of cryptocurrencies. Read more →

Mining

Using computers to secure a proof-of-work blockchain like Bitcoin and earn new coins as a reward.

N

NFT

Non-fungible token: a unique token that represents ownership of a specific item, such as art, a game item or a ticket.

No-action letter

A letter from regulator staff saying they would not recommend enforcement for a specific activity, based on the facts provided. It is not a formal ruling. Read more →

P

Presale

An early sale of a token before it lists on exchanges, often at a lower price, usually with tokens unlocked over time. Read more →

Private key

The secret code that controls a crypto wallet. Anyone with it can move the funds, so never share it.

Proof of stake

A way of securing a blockchain where validators lock up tokens as collateral instead of using mining power. Read more →

Proof of work

A way of securing a blockchain through mining, where computers compete to solve puzzles. Bitcoin uses proof of work.

R

Real-world assets (RWA)

Traditional assets such as bonds, funds, property or stocks represented as tokens on a blockchain. Read more →

S

Seed phrase

A list of 12 or 24 words that can restore a wallet. Whoever has it controls the funds, so store it offline and never share it.

Smart contract

A program on a blockchain that runs automatically when its conditions are met.

Spot price

The current price to buy or sell an asset for immediate delivery. Read more →

Stablecoin

A token designed to hold a steady value, usually $1, backed by cash, bonds or other assets. USDT and USDC are the largest. Read more →

Staking

Locking up tokens to help secure a proof-of-stake network in return for rewards. Read more →

T

TGE

Token generation event: when a token is created and first becomes transferable, often the day presale buyers receive their first unlocked tokens. Read more →

Token unlock

When previously locked tokens, often held by teams or early investors, become free to move or sell. Read more →

Tokenization

Turning ownership of an asset, such as a share, bond or property, into a token on a blockchain. Read more →

Tokenomics

The economics of a token: its supply, how it is distributed, how it is unlocked and what it is used for. Read more →

V

Validator

A participant that checks and confirms transactions on a proof-of-stake blockchain.

Vesting

A schedule that releases tokens gradually over time instead of all at once. Read more →

W

Wallet

An app or device that stores the keys to your crypto and lets you send and receive it.

Whale

Someone holding a very large amount of a cryptocurrency, big enough to move its price.

X

x402

An open payment standard that uses the web's "402 Payment Required" code so software and AI agents can pay per request. Read more →

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