Crypto Slang and Blockchain Terms

As the crypto market continues to skyrocket, it’s time to decode the language that fuels this ecosystem.

Get ready to dive into our no-nonsense cryptocurrency glossary, designed to demystify the buzzwords and give you a solid grasp of the key terms in the crypto space. From the nuts and bolts of blockchain, decentralized finance (DeFi), mining, wallets, and smart contracts, we’ve got you covered.

We know you’re busy, so we cut out a lot of the fluff in this glossary with key crypto terminology and we’ll link directly to resources where you can go deep into a topic to crack the code.

Crypto glossary and key terminology

Accumulation Address:

Bitcoin addresses, excluding Miners and Exchanges, that have received 2+ non-dust Bitcoin transactions and have NEVER spent the Bitcoin.

Airdrop:

An airdrop is like a free sample of crypto tokens sent to one or more addresses on an existing blockchain. Most of the time it’s offered as a reward or incentive to try a new dApp for example which can help new projects establish and encourage adoption.

ATH (All time high):

When an asset reaches a new high price, we like to say it’s an all time high (ATH for short).

Altcoin:

Any cryptocurrency NOT Bitcoin is called an Altcoin.

Altseason:

A period of time when a significant amount of money moves out of Bitcoin into altcoins.

Backwardation:

Bearish market scenario where futures trade at a price lower than spot Bitcoin.

Bag Holder:

Someone who holds a large quantity of a specific cryptocurrency and doesn’t plan on selling.

BRC-20:

Token standard for minting fungible tokens through Ordinals protocol on the Bitcoin Blockchain.

Bear Market:

A bear market is the opposite of a bull market where more people are selling vs. buying a crypto. Bear markets can be identified by a rapid downward movement of a crypto that extends for a long period of time.

Blockchain:

A blockchain is a tamper-proof, decentralized public ledger which exists on a distributed network. Individual ‘blocks’ which contain data are strung together to enable peer-to-peer transactions governed by rules (consensus) which are not bound to corporate governance or state/nation government.

Block:

A ‘block’ is data which is added to the blockchain by miners and validators and contains a timestamp hash. Blocks cannont be changed after committed to the blockchain to ensure balances are not double spent, contain digital signatures, and match the hash of the previously added block.

Bridge:

Not all coins are interoperable depending on their Layer or Blockchain. A Bridge, like WalletConnect helps to facilitate transactions cross-network or with dApps.

Bull Market:

A period of time when the price of some (or all) cryptocurrencies increase in price for a sustained period of time. Bull markets are identified by more buyers than sellers which decreases supply, increases demand forcing the price up.

Bubble:

Bubbles can pop and cause the price of a crypto to burst and come down rapidly when the price is higher than the value.

Buy the dip:

Everyone wants to buy low. Some folks will HODL and some will sell high to maximize a profit. Buying the dip is hard to time, and you’re often better off dollar-cost-averaging into a new crypto position.

Coinblocks Created:

The number of bitcoins in the network multiplied by the number of blocks for a 24 hour period.

Coinblocks Destroyed:

The number of bitcoins transacted on the Bitcoin Blockchain multiplied by the number of blocks each coin remained dormant prior to the transaction.

Coins (vs. Tokens):

For a ‘crypto’ to be considered a ‘coin’, the underlying asset must have its own blockchain.  Bitcoin (BTC), Monero (XMR) and Litecoin (LTC) are examples of coins whereby Tokens like Aave (AAVE) and Tether (USDT) do not have their own blockchain opting for using Ethereum Blockchain to issue the Tokens.

  • Stablecoins like Tether (USDT), USD Coin (USDC), and Dai (DAI) are assets pegged to the US Dollar.
  • Privacy Coins like Monero (XMR), Zcash (ZEC) and Secret (SCRT) have no public ledger and are virtually untraceable.
  • Meme Coins like Shiba Inu (SHIB) and Dogecoin (DOGE) are highly speculative coins with no commercial purpose.

Consensus:

Consensus protocols are algorithms that can speed up disputes between nodes who many have conflicting data. Consensus is the foundation for a blockchain to operate efficiently and effectively.

Contango:

Bearish market condition where futures contracts trade higher than Bitcoin spot price.

Cryptocurrency (Crypto):

A digital unit of value that can be exchanged peer-to-peer across a network without relying on a bank or traditional financial institution to approve the transaction. Crypto can act like a store of value, medium of exchange, a reward, unit of account, or an access token for a product or service.  Dash (DASH), Bitcoin Cash (BCH) and Litecoin (LTC) operate as means of payment.

Cryptonetwork:

Decentralized P2P network of nodes that rely on consensus mechanisms to ensure the development and maintenance of the public blockchain .

Cryptography:

Cryptography uses secrets and ciphers to encrypt data which makes cryptocurrency secure. A cryptographic hash function, for example, ensure the integrity of data in digital applications and serve as the data structure that blockchains are built on.

Custody:

Your bank or brokerage act as a custodian of your assets. These firms typically, lend out your money to others (think mortgages and loans) and make their profi on the interest. You don’t actually own your assets.
Crypto, on the other hand, can be held in custody by an exchange in a hot wallet for example, or you can self-custody your assets in a cold wallet stored offline.

DAO(s) “Decentralized autonomous organizations”:

DAOs are decentralized meaning their rules cannot be changed by any one person. DAOs are autonomous and exist without human intervention based on logic written into smart contracts.

dApps (Decentralized Applications):

dApps are P2P applications that run on a blockchain and can perform a valuable task, like an iPhone app you download from the iOS app store. iOS apps execute code that is stored on the developers server, dApps code is written in smart contracts. iOS apps can stop working if the developer goes out of business, dApps exist forever. No one owns the data and no one needs permission to use the dApp. Pretty cool right?

Decentralized (Decentralization):

Because blockchains are decentralized, the system is spread over a network of users where no individual has ownership of the network. Unlike government or traditional financial institutions, there is no single point of control which offers redundancy and a resistance to censorship.

DEX (decentralized exchange):

Decentralized crypto exchanges, like Uniswap, operate without a central authority. These P2P exchanges are should be approached with caution is there is no undoing mistakes or customer support hotline.

DCA:

Dollar Cost Averaging is a crypto accumulation strategy where you purchase a set amount of crypto automatically at a daily, weekly, or monthly frequency. This is a great strategy for anyone who doesn’t have a crystal ball to time the market perfectly when entering a trade.

DeFi (Decentralized finance):

DeFi refers to dApps that replicate traditional financial services like lending, insurance, and exchanges. DeFi is a TradFi disruptor by removing intermediaries (ie 0- banks) and are regulated by smart contracts on the blockchain.

Delta Cost Basis:

Downside risk calculation measured by Bitcoin’s realized price minus the life-to-date moving average.

Difficulty:

Computational power required from miner’s to validate a transaction measured in Exa-hashes or Tera-hashes per second and serves as a proxy for the security of the network (ie – blockchain).

Don’t Trust, Verify:

With crypto, you don’t have to trust anyone. Anyone can and should verify their transactions which are made public on the blockchain. Big banks like when you trust them with your savings so they can lend it out to others who in turn need to be trusted to pay back the loan.

Double Spending:

Proof of Work mechanisms on the blockchain rewards miners who ensure that no one spends the same account balance twice. Off chain, this service is provided by banks and credit card companies who ask for you to trust and pay them a percentage of the transaction.

DYOR:

DYOR is an acronym for Do Your Own Research. The opposite of DYOR is trusting a recommendation from a crypto influencer who may be shilling a coin they’re a bag-holder for to get a quick pump.

Ether:

Ether (ETH) is the main cryptocurrency token of the Ethereum blockchain network.
Ethereum and Ether are not the same.

Ethereum:

The blockchain network where ETH and other Ethereum based tokens are held and exchanged. Ethereum can also be used to store data and run dApps.

Exchange supply:

The total number of bitcoins stored in addresses managed (in-custody) by exchanges like Coinbase.

Fiat currency:

Fiat is a fancy word for traditional currency like US Dollars (USD) backed by governments. Most folks use fiat to fund an exchange account so they can enter crypto positions.

Fork:

A fork is a new branch of code for an open source project that represents a different version of the original code often due to a disagreement or optimization. A blockchain fork is a permanent split in the network which splits into two parallel branches .

In crypto, a fork is a disagreement between nodes. The disagreement can be about what code is being run, or which blocks are included in the blockchain. Such a disagreement causes the blockchain to split into two parallel chains. There are two types of forks.

FUD:

Fear, Uncertainty, and Doubt are used to influence the general public’s perception of crypto by spreading negative and sometimes misinformation. These are generally people who missed the boat on being early go crypto and don’t want progress.

Gas:

“Gas” is the fee paid to the miners of a blockchain to execute the code of a smart contract. Miners keep the blockchain healthy and prevent double spending. For that service they are paid gas.

Genesis Block:

A ‘genesis block’ is the first block created on a blockchain and sets the rules for the blockchain. The Bitcoin genesis block was mined on January 3, 2009 by Satoshi Nakamoto.

Hardware Wallet (Cold Wallet):

A crypto wallet that stores your private keys in a secure hardware device offline on a device that is similar to a flash drive. The alternative is leaving your crypto in hot wallets where the exchange acts as the custodian and if they shut down, like FTX, you may not be able to recover them. Not your keys, not your coins.

Hash function:

A hash function produces a deterministic, non-invertible, and collision-resistent cryptographic digest to make mining more efficient and difficult to reverse engineer.

Hash Rate:

Hash rates are mathematical puzzles based on the hash functions which miners must solve on Proof-of-work blockchains like Bitcoin. The higher the hash rate the more secure the network since no single miner can own the majority for malicious purposes.

HD Wallet:

Hierarchical deterministic wallets, like Rainbow use your crypto secret phrase to generate an infinite number of sub-wallets derived from your primary wallet.

HODL:

HODLers are crypto holders who don’t plan on selling regardless of price fluctuations. Bitcoiners, also called Bitcoin Maximalists/Maxis, will use Dollar Cost Averaging to accumulate and HODL.

Hot Wallet:

A hot wallet is always connected to the internet. If you bought your first crypto on a centralized exchange, you are automatically provided the keys to your hot wallet. For security reasons, transferring your crypto to cold wallets is a common practice for seasoned vets.

ICO:

An Initial Coin Offering is a method for (new) crypto projects to raise capital to build out their business and increase awareness. It’s analogous to an IPO on the stock market.

Interoperability:

A technical term for how different blockchains work together. Bridges, for example, are interoperable protocols to enable transfers across two different blockchains.

Layer 1 / Layer 2 Blockchain Software:

Bitcoin is a Layer 1 software. It’s the most secure foundation of the blockchain but often lacks features like scalability or speed. Layer 2 software, like Lightning, is built on top of Layer 1 to make it more functional while still retaining the security of the underlying Layer 1.

Ledger (tamper-proof):

A ledger is a list of transactions in IRL or on chain. A ledger transaction can’t be altered without detection because it’s cryptographic digest and auditable by other blockchain participants.

Locked supply:

Illiquid supplly held by entities with a less than 25% chance of spending based on historical behavior.

Long position:

Going long is purchasing a coin with the intent to sell the crypto for a higher price than you paid.

Small/Mid/Large Cap:

These are the 3 main categories of cryptocurrency represented by total value of the coin which is expressed in market capitalization. Some folks will use this to infer stability, risk-reward profile & growth potential. Small Caps tend to be riskier but offer more potential upside, unless you’re a Bitcoin Maxi and believe BTC will moon.

Market Cap:

Market capitalization is the indicator of a crypto’s current worth based on the total circulating supply of coin multiplied by the price of each coin.

Miners:

Miners validate transactions on the crypto network and ensure that there is no double spending. They are incentivized by earning crypto rewards for being the decentralized stewards of the ledger and securing the network.

Mining:

Miners solve complex math problems to earn rewards and in turn ensure the Blockchain networks are kept verified and secure.

Mooning:

A coin is spiking, typically and all time high and heading to the moon!

Multi-signature (multi-sig):

Multi-sig is like a requirement for one or more digital cosigners for the transaction to be valid. The most common use cases for multi-sig are smart contracts and self-custody wallets.

MVRV:

MVRV is Market Value to Realized Value and measures the marked cost bases.

Node:

A node is a device that follows a network protocol to complete an action like validating transactions helping ensure efficiency.

No coiner:

Someone who missed the boat and holds no crypto in their portfolio. They spread FUD and are perfect candidates to use a Dollar Cost Averaging strategy to get into Bitcoin.

Not Your Keys, Not Your Coins:

A common saying for proponents of crypto self-custody. If your crypto is in a hot wallet on one of the exchanges, it’s not really yours since the exchange acts as a custodian.

NFTs (Non-fungible tokens):

NFTs are digital assets that represent real-world objects like art, music, and in-game items. They are Non-Fungible meaning they cannot be copied or divided up.

NRPL:

The market indicator of Net Realized Profit & Loss from trading activity. Different from NUPL which measures the unrealized profit and loss of all coins on the network.

On-chain:

Economic Activity that occurs on the Bitcoin blockchain

OpenSea:

The largest marketplace to buy and sell NFTs.

Ordinals:

Creating non-fungible tokens (NFTs) on the Bitcoin Blockchain via inscriptions, metadata, is attached to fractions of a Bitcoin, called Satoshis measured in units of 0.00000001 BTC.

Peer-to-Peer (P2P):

A P2P network connects nodes together like a spiderweb to ensure that there is no single point of failure preventing data transfer between network participants.

Private Key:

A private key is a random string of numbers and letters that acts like a password to access your crypto holdings.

Precoiner:

Precoiners haven’t bought any crypto yet. They are always waiting for the market to collapse. They make up a lot of the new customer base here at Stratus because starting your crypto journey with a recurring buy is a great way to dollar cost average Bitcoin.

Protocol:

A protocol is a set of rules that determine how a software program should behave. Nodes on the blockchain follow protocols to act as record keepers and counter-parties for P2P transactions.

Proof of work (PoW):

Miners on a blockchain earn rewards (crypto) for completing complicated mathematical puzzles to submit a block to the blockchain.

Proof of stake (PoS):

PoS is the most energy efficient alternative to mining and does NOT require problem solving to validate a new block on the blockchain. Participants lock up their own crypto assets on the network and earn a reward. If the staker is a bad actor, some/all of their staked assets can be confiscated by the network ‘slashing’ process.

Pump & dump:

When bad actors and early bag holders of some cryptos collude to inflate prices with the intention of selling out when the price goes up.

Public Wallet Address:

Similar to your Venmo handle, a public wallet address can be shared with others so they can send crypto or NFTs to you.

Parabolic:

Cryptos that are mooning can also considered parabolic if the price increases exponentially in a short period of time.=

Private/public key:

NEVER SHARE YOUR PRIVATE KEY! The private key is a secret code to access your wallet to spend or transfer your crypto. So your public key is like the address to your house and the private key unlocks the front door so you can get inside.

ROI (Return on Investment):

ROI is the percentage of how much money has been made compared to the initial investment. When dollar cost averaging, it’s important to note that if your ROI is low then so is your average price for acquiring the crypto. That is a good thing for long term bitcoiners.

Rekt:

Getting rekt is a badge of honor on crypto twitter when a trader takes a big loss and shares it publicly.

Satoshi (Sat):

Sats are the smallest denomination of Bitcoin you can purchase. It’s represented as one hundred millionth of a single Bitcoin or 0.00000001 BTC. Stacking sats is a common way for bitcoiners to talk about their long BTC positions.

Secret Seed Phrase:

Public and private keys validate sending/receiving of crypto while your secret phrase is a random set of 12-24 English words that act as the password to your wallet.

Settlement:

A smart contract or crypto transfer ultimately settle when the transaction has been fulfilled as promised.

Short-term Holding and Holders (STH):

Bitcoin supply that has moved in the last 155 days and may move again in the short term.

Signature (Digital Signature):

Digital signatures are unique to a single person or entity and derived from a public/private key pair. A signature on a public key can only be created by the holder of the corresponding private key ensuring the transaction is authentic.

Smart Contracts:

Code the lives inside the blockchain to define agreements made between parties like Avalanche (AAVE) and Solana (SOL).

SOPR:

Ratio of the price of Bitcoin sold in a day divided by the average price of the coins when it moved last.

Support & Resistance:

The support level for crypto is lower than the current price of the coin, and considered the lowest level the price will drop under normal circumstances. Resistance levels is the upper bound limit at which crypto traders believe stop an asset’s price from exceeding.

Short position:

Shorting a coin is a bet that the price will go down. You sell the coin, even if you don’t own it, at a high price and cover your position by buying the coin at a lower price in the future. You make money when the price goes down. If the price moons, you could take a significant loss covering your short position.

Smart contracts:

Smart contracts are self-executing digital contracts that run on a blockchain network.They allow a direct exchange between two people based on the agreement without the need for an intermediary like a bank.

Shill:

Shill is crypto slang for someone promoting a coin or project because they want the price to go up. On Twitter, you need to pay attention to who you think is shilling a new coin vs. providing an unbiased recommendation.

Stablecoin:

Assets that are pegged to fiat currency or gold and do not fluctuate in value are called stablecoins. This is a great way to trade or hold assets without converting your crypto into fiat to make the purchase.

State (Blockchain State):

The state is a snapshot of the blockchain network with incredible detail. Nodes maintain shared states of the blockchain so there is no need to rely on a centralized entity.

Tokens:

Tokens are NOT cryptocurrencies. They are digital representations of an asset and are issued from smart contracts built across various crypto networks. Types of crypto that represent an asset or specific use and reside on their own blockchain. The two most common token types on the Ethereum blockchin are ERC-20 (smart contract tokens) and ERC-721 (NFTs).

  • Venture Capital Tokens: Helium (HNT) and Arweave (AR) are examples of tokens that represent an investment into a company.
  • Governance Tokens: Aave (AAVE), Curve DAO (CRV) and Sushi (SUSHI) are examples of DeFi governance tokens with dividends.
  • Fan Tokens: Sports organizations like Manchester City (CITY) issue tokens to fans which grant benefits to the holders.
  • Metaverse/Web3 Tokens: In-game assets like Axie (AXS), Real Estate holdings like Sandbox (SAND), NFTs like Bored Ape Yacht Club.

Trad Fi:

This is an acronym for traditional finance (banks, brokerages). Before Bitcoin, TradFi institutions like banks or credit card companies were the primary record keeper for business and personal transactions. Crypto is disrupting the industry by providing similar services, available via blockchains, that are more efficient, secure and cheaper than the TradFi alternative.

UTXO:

An ‘Unspent Transaction Output’ (UTXO) is the output of a Bitcoin transaction and prevent the double spend problem that has historically plagued ALL digital currencies prior to Bitcoin.  UTXOs can exist in any quantity and represent the unspent supply of Bitcoin.

Validators:

All Validators are also miner nodes. Some miners work to only solve cryptographic puzzles while other miner nodes serve as validators of transactions.

Virgin Bitcoin:

These are Bitcoins purchased directly from miners.

Volatility:

Price fluctuations in a financial market. The higher the volatility, the more intense the price swings and the riskier the investment.

Wallet:

A crypto wallet is a place to store your private/public keys and thus your crypto assets. Various wallet types include online wallets, software wallets, paper wallets & hardware wallets.

Whale:

A whale is a market mover due to the size of their crypto position

White Paper:

A comprehensive guide covering a particular crypto project’s use case, technology, key features and more.