Crypto glossary: 40 terms in plain English

Crypto has its own vocabulary, and much of it is jargon or slang. This glossary gives a one-line definition of 40 terms that appear often in news coverage. The terms are grouped by topic and listed alphabetically within each group. Where a term has its own guide, the name links to it.

The basics

• Altcoin. Any cryptocurrency other than bitcoin.
• Bitcoin. The first cryptocurrency, launched in 2009, with a supply capped at 21 million coins.
• Blockchain. A shared record of transactions, kept by many computers and stored as a chain of linked blocks.
• Coin. A cryptocurrency that is native to its own blockchain, such as bitcoin or ether.
• Cryptocurrency. Digital money whose ownership is recorded on a blockchain instead of by a bank.
• Fiat. Government-issued money such as the dollar, euro or pound.
• Satoshi. The smallest unit of bitcoin, equal to one hundred-millionth of a coin.
• Stablecoin. A token designed to hold a steady value, usually one US dollar.
• Token. A crypto asset issued on top of an existing blockchain, not on a chain of its own.

How networks run

• Block. A batch of transactions added to the blockchain together.
• Consensus mechanism. The method a network uses to agree on one version of its record.
• Fork. A change to a blockchain's rules, which can split it into two separate chains.
• Gas. The fee paid to process a transaction on Ethereum and similar networks.
• Halving. The cut, by half, in the reward for mining bitcoin, which happens about every four years.
• Layer 2. A network built on top of a blockchain to make transactions faster and cheaper.
• Mining. Using computing power to add blocks to a blockchain in return for new coins and fees.
• Node. A computer that stores a copy of the blockchain and checks new transactions against the rules.
• Smart contract. A program stored on a blockchain that runs automatically when its conditions are met.
• Staking. Locking up coins to help secure a network in return for rewards.

Wallets, trading and apps

• Address. A string of letters and numbers that identifies where crypto can be sent, like an account number.
• Airdrop. A free distribution of tokens to a group of wallet holders.
• Burn. To destroy tokens for good by sending them to an address nobody can spend from.
• DeFi. Decentralized finance, meaning lending, borrowing and trading run by software and not by a bank.
• Exchange. A platform where people buy, sell and trade crypto.
• KYC. Know your customer, the identity checks that exchanges must carry out.
• Market cap. A coin's price multiplied by the number of coins in circulation.
• Mint. To create new tokens or a new NFT on a blockchain.
• NFT. A non-fungible token, a unique token that records ownership of a specific item.
• Private key. The secret code that lets its holder spend the crypto at an address.
• Seed phrase. A list of 12 or 24 words that can restore a wallet and all its keys.
• Wallet. An app or device that stores private keys and signs transactions.

Market slang

• Bear market. A long period of falling prices.
• Bull market. A long period of rising prices.
• DYOR. "Do your own research," a reminder not to rely on other people's claims about a coin.
• FOMO. Fear of missing out, the urge to buy because a price is already rising.
• FUD. Fear, uncertainty and doubt, a label for negative news or rumor, whether or not it is true.
• HODL. To hold a coin through price swings instead of selling. It began as a misspelling of "hold" on a bitcoin forum in 2013.
• Pump and dump. A scheme in which promoters hype a coin to raise its price, then sell to the buyers they drew in.
• Rug pull. A fraud in which a token's creators take investors' money and abandon the project.
• Whale. A person or organization that holds a very large amount of a cryptocurrency.