Cryptocurrency Glossary

The practice of buying and selling the same coins on different exchanges at the same time to take advantage of price differences.

An investor who has a net worth of over $1 million and/or an annual salary over $200,000-300,000.

Anti-Money Laundering. AML laws and restrictions require exchanges to obtain personal information about their customers and their activities.

All-Time Low. The lowest price a cryptocurrency has ever reached.

Artificial Intelligence. As machines advance in intelligence, they are capable of learning from their environments and completing more complex tasks.

Application Programmer Interface. A type of toolkit provided for developers for creating applications.

A process for solving a mathematical problem. In blockchains consensus algorithms are used to verify transactions.

Wealthy individuals who contribute significant funds (usually over $1,000,000) to emerging projects.

The amount of data that can be stored in one block of a given blockchain. For example, the Block Size limit of Bitcoin is 1MB. Larger block size allows for more transactions per block. Thus, it’s not that transactions are “faster” or “slower”. It’s that transactions may be seemingly faster because the network is handling more transactions at a time.

The amount of money one has available to him/her.

A term used to describe cryptocurrency projects that facilitate programmable transactions rather than simply acting as methods to store and transfer value. Projects like Ethereum are known as Blockchain 2.0 contracts because they allow their users to create and execute smart contracts and develop decentralized apps.

A bank run occurs when many clients withdraw their money from a bank at the same time, because they believe the bank may cease to function in the near future. Banks do not hold everyone's money at once, they lend it out. So if everyone tries to get their money at the same time, they can't.

The first blockchain-based network that allows its users to store and transfer wealth.

A short rise in a cryptocurrency’s price that makes investors think the price will continue to rise. Instead, the price falls significantly following the rise, fooling the “bulls.”  

Backtesting is the method of running your trading strategy on historical data to find out how well it would have performed.

An individual who believes that increasing Bitcoin’s block size would improve its scalability. Roger Ver is the most notable Big Blocker.

A condition that affects cryptocurrencies when the data stored reaches very large sizes due to increasing numbers of users and transactions. When blockchain bloat gets severe, transaction speed suffers.

A segment of data recorded on the blockchain that can contain transactions and other information.

A company led by cypherpunk Adam Back that promotes second layer scaling solutions for Bitcoin.

A transaction that combines multiple transactions into one for increased efficiency and decreased fees.

Bitcoin’s ticker symbol.

Optimistic about the future of a cryptocurrency’s price.

Bitcoin Improvement Protocol. New feature proposed for Bitcoin are BIPs.

A short drop in a cryptocurrency’s price that makes investors think the price will continue falling. Instead, the price rises significantly following the drop, fooling the “bears.”  

The original Bitcoin wallet, considered to be among the safest wallets available.

Pessimistic about the future of a cryptocurrency’s price.

The first successful hard fork of Bitcoin that allows the protocol to grow and scale by removing its block size limit.

a high-yield ponzi scheme in the cryptocurrency market, guarantee profits to investors. Customer losses are estimated to have exceeded $1 billion and was shut down in January 2018.

1 Bit is equal to 1/1,000,000 of a Bitcoin. Not to be confused with the computer science definition in which 1 bit equals 0.125 bytes.

The first blockchain-based cryptocurrency, launched in 2009. Bitcoin remains the most influential and widely recognized coin. All other cryptocurrencies are known as "altcoins," simply because they are not Bitcoin.

Controlled by one group or within one certain area.

Addresses created to hold the remaining balance when users spend less than a full input. Mostly used in hierarchical deterministic wallets that can create an unlimited number of addresses.

Digital currency that uses cryptography. Bitcoin & Altcoins are all types of cryptocurrency. 

A cryptocurrency that relies solely on its own technology to function.

An aspect of the Bitcoin Core wallet that allows users to specify which coins they wish to spend and which Change Addresses any remaining balance will be sent to.

A trade on a popular cryptocurrency exchange.

Verifications of consensus by miners and/or nodes. After an individual sends payment on a blockchain, confirmations are required before the recipient can accept payment. 

A general agreement among participants using and mining a cryptocurrency.

In the cryptocurrency sphere this term refers to storing cryptocurrency in a location that is offline and thus inaccessible by anyone on the internet.

A paper written by Eric Huges that outlines Cypherpunks’ philosophy and vision. This Manifesto was a big influence on many early cryptocurrency enthusiasts.

An irreversible list of all transactions that have ever occurred on a platform.

Uses nodes spread out across many different locations to achieve decentralization.

Transfers of value that are too small to be sent due to the proportionately high fee incurred. 

An organization that operates to earn profits for its shareholders (coin holders) by creating value for the free market.

DAA. A collection or portfolio of assorted cryptocurrencies. For example, one Digital Asset Array could contain BTC, ETH, and DASH.

Directed Acyclic Graphs. Also referred to as “Tangle.” DAG is an alternative to the “chain of blocks” architecture used in many crypto projects.

A feature which allows KyberNetwork to maintain high levels of liquidity. The DRP keeps reserves of cryptocurrencies and establishes rates of exchange between them, allowing any user to easily trade one crypto for another.

A famous problem that occurs when cryptocurrency is spent more than once. Miners and transaction finality ensure that double-spend cannot occur.

A cryptocurrency that uses the “Doge” meme with a cult-like following.

Distributed Denial of Service Attack. A means by which a malicious individual shuts down another individual's internet connection by overloading it with requests.

An application created to run on a user's PC.

Decentralized exchange. A platform (which isn't controlled by any single authority) that allows users to buy and sell cryptocurrencies.

Any non-physical object of value, like a document, an audio file, or a logo, that can be owned and controlled.

Decentralized Autonomous Organization. An organization governed by smart contracts founded to allocate funds to cryptocurrency projects.

A group of businesses and organizations working together to build a globally-accepted identity verification system. The DIF uses blockchain technology to create a system that doesn't require a centralized authority for purposes of identification.

A tax on cryptocurrency holdings that encourages spending coins because they are constantly being destroyed.

DPoS. A consensus mechanism that has a blockchain's nodes vote on the correct version of the blockchain. 

A metric for measuring bitcoin inactivity. Each day a Bitcoin remains unspent is another day added to its total number of Days Destroyed.

Software for storing cryptocurrency that offers decreased risk of losing funds because of its ability to generate unlimited addresses from a single starting point, or "seed."

An extremely secure messaging functionality offered by QRL.

Ethereum Virtual Machine. A testing environment on the Ethereum network for executing smart contracts and promoting security.

A cryptocurrency created by Vitalik Buterin that runs on Ether (ETH). Ethereum was the first blockchain-based technology to make smart contracts and decentralized applications possible.

The native tokens of the Ethereum platform. Required in order to send transactions or execute smart contracts.

Online platforms on which individuals can buy and sell cryptocurrencies.

Financial technology (Fintech) is used to describe new technologies that seek to improve the use and delivery of financial services.

A change in a cryptocurrency’s software that does not make it incompatible with the original version.

A term used to describe the way that cryptocurrencies remove many of the inefficiencies and hassles inherent in alternative methods of transferring payment.

An amount of coins paid to users for participating in PoS consensus.

A hypothetical society in which no one is forced to do anything against their wishes and all actions are voluntary.

Fear of Missing Out. Investors with FOMO buy cryptocurrency (emotionally rather than logically) for fear of missing out on profits.

Fear Uncertainty and Doubt. The emotional (rather than logical) belief that cryptocurrency prices will fall.

A percentage of block reward that is paid to the founders of a cryptocurrency rather than to its miners. Zcash is a cryptocurrency with a Founders’ Reward.

The first block mined on a blockchain.

An open-source database for developers to create and share computer coding with a large community.

LTV stands for Loan-to-value. The ratio expresses the amount of a loan compared to the value of an asset. For example: taking a $1,000 loan and putting up $2,000 worth of Bitcoin as collateral = 50% LTV. The loan is worth 50% of the bitcoin collateral securing it.

Someone who does not sell, but holds on to his coins. "HODL"  was originally a typo but it gained the status of a funny backronym: “Hold on for dear life”.

The act of protecting an asset from risk. A hedge can protect against losses or even offset against gains.

A physical device that stores private keys.

The process of intermittently decreasing the block reward given to cryptocurrency miners by 50%.

The maximum amount of money a cryptocurrency’s founders will accept while raising money in exchange for early coins on their platform.

First made popular in a post by a drunken Bitcoiner who advocated buying but not selling Bitcoin, it is now a meme to intentionally misspell “hold.” Hodlers see huge potential in the future of a cryptocurrency and don’t plan on selling anytime soon.

The power of a mining rig. Similar in concept to the Horse Power of a vehicle.

When an asset (i.e. coin) cannot be easily bought or sold due to a lack of buyers or sellers in a market. If there are only a handful of buyers or sellers the price may be substantially higher (due to few sellers charging a premium) or substantially lower (due to a few buyers demanding discounts).

Created each time coins are sent to an address.

A request for communication from one node to another node.

The process of increasing a cryptocurrency's supply, which usually drives its price down.

The term used to refer to blockchains to describe the way in which blocks cannot be changed after they are recorded.  

A popular programming language.

CEO of Bitmain, the largest distributor of cryptocurrency mining machines.

Software that records every button press of an individual’s keyboard. Often used to hack into accounts by recording passwords.

Purchasing a coin with the expectation to sell it at a higher price sometime in the future for a profit. Basically profiting from the rising price of an asset.

A cryptocurrency meme, short for Lamborghinis. When investors' coins' prices go to the Moon, they can buy Lambos.

Borrowed money used to trade assets.

The measure of how quickly an asset can be exchanged for usable currency.

A mathematical problem that is solved by participants of a blockchain to verify transactions in exchange for block rewards.

An agreement that allows individuals to sell their computing power for the purposes of verifying transactions on a blockchain.

The process by which users on a PoS blockchain verify transactions and receive new coins for their participation.

A popular online wallet that supports Ether and most ERC20 tokens.

The total value of a cryptocurrency. Calculated by multiplying a coin’s price by its total supply.

Software that allows individuals to store their cryptocurrencies on handheld devices.

A feature that requires several keys to authorize a single transaction, especially for dividing responsibility among separate parties.

A method of intentionally obscuring the source of illegally-obtained funds.

The ability of machines and computers to integrate data and learn from it without being programmed to do so.

A sub-unit of Bitcoin: 1000 mBTC equal 1 BTC.

John McAfee (the creator of McAfee antivirus) is a cybersecurity mogul who is known for promoting cryptocurrency and speculating about altcoins.

A fee paid to voluntary participants for using their computing power to verify transactions. When a miner mines a block they get a block reward as well as all the transaction fees in it.

A cryptocurrency that is very popular on the Darknet because it is considered to be more anonymous than Bitcoin and similar coins.

A cryptocurrency meme that refers to the skyrocketing of a coin's price. When Hodlers’ coins go to the Moon, they can all buy Lambos.

A very small payment made possible with digital currencies.

An individual that volunteers computing power to verify transactions on a blockchain in exchange for block rewards.

A popular framework for JavaScript code to be written in. 

A cryptocurrency that allows data (and transactions) to be written onto its blockchain.

Digital agreements between users on NEO's platform that are carried out automatically when their terms are met.

An arbitrary number that is used only once in cryptography to make replay attacks impossible.

A block that is no longer a part of the original blockchain because it was not verified by the majority of miners.

The initiator of communication on a cryptocurrency network.

A third-party entity capable of transmitting reliable information to a blockchain so that smart-contracts can be executed.

Transfer of value that takes place outside of a blockchain for reduced fees and quicker transaction time.

Outputs of an algorithm that can be examined and verified. This term is commonly used in cryptocurrency gambling.

PoS. A method of minting new coins and securing a platform by allowing users to stake their coins and receive more coins as a reward. Introduced as an energy efficient alternative to PoW (Proof of Work).

PoP for short. A consensus mechanism used by DigixDAO to track the movements of physical assets, identify their ownership, and ensure their security.

A portion of the total supply of a cryptocurrency reserved for its founders. These funds are often marked as funds to pay developers or fund future ventures, but cryptocurencies with premines are generally viewed as less legitimate and fair those without premines.

A public or private offering of tokens to interested investors, generally offering a cheaper price than the coin’s ICO price. Pre-sales are commonly seen as marketing gimmicks.

Private keys are used to spend cryptocurrencies.

A situation that occurs when an asset's market value is far higher than it's actual worth, making a sharp drop in price imminent.

Proof-of-Importance is a consensus algorithm similar to PoS. Nodes "vest" currency to participate in the creation of blocks. Unlike PoS, Proof-of-Importance quantifies a person’s support of the network. NEM is using Proof-of-Importance.

Any cryptocurrency that focuses on maintaining private transactions between users. Examples are Dash, ZCash, and Monero.

The consensus algorithm introduced by Bitcoin. PoW requires miners to compete against each other to add new block and earn rewards.

PoI stands for Proof-of-Importance. It is a new consensus algorithm that requires users to stake currency to participate in the consensus. Compared to PoS, it adds importance to staking. Thus, it takes into account one’s involvement in the network. PoI was introduced by NEM.

A scalability solution for Ethereum that allows more transactions per second by introducing additional blockchains to the main Ethereum blockchain. 

A cryptocurrency that uses both PoW and PoS in its consensus mechanism to offer increased security.

A rapid rise in a cryptocurrency’s price.

Occurs when a cryptocurrency’s price shoots up and then quickly crashes. Pump and dumps are often coordinated manipulations of the market by groups of individuals for profit.

Decentralized networks in which individuals interact with each other directly.

Proof of Stake and Trust. A consensus mechanism used by Waltonchain that relies on token holders (nodes) to verify transactions while retaining information about nodes' past performance to give higher rewards to the most reliable nodes.

QRTs. Customizable tokens that can be created using Quantum Resistant Ledger. QRTs are resistant to attacks from quantum computing.

A code containing information that can be read by a device with a camera.

A platform that connects banks, payment providers, and digital asset exchanges to provide frictionless transactions.

An individual that contributes their tokens to Kyber Network's Dynamic Reserve Pool to improve the platform's liquidity.

A site that aggregates a nearly endless range of topics. Subreddits exist within Reddit to focus on specific topics.

Transfer of currency across a large distance, usually across borders.

A feature of PIVX that allows users to complete transactions instantly without needing to wait for confirmations.

Selling, before buying, and intending to repurchase the stock at a lower price to realize the profit from a coin/asset decreasing in value. Basically profiting from the falling price of an asset.

A block that has been worked on by a miner but is not included in the blockchain because another miner successfully completes another block first.

A platform that functions alongside an existing blockchain protocol, allowing transactions to occur off of the main blockchain. Sidechains can be customized to allow features like faster transaction time and increased anonymity.

A mathematical mechanism for combining a public address with a private address to ensure authenticity and prevent forging.

Any cryptocurrency pegged to a stable asset for the purpose of reducing price volatility.

An online black market on the Darknet best known as a place individuals could buy and sell illegal goods and services. One of the first communities to use Bitcoin as currency.

The anonymous person or group that created Bitcoin.

A blockchain that runs separately from a cryptocurrency's main blockchain, using the native currency to carry out transactions. Subchains help scalability by reducing the amount of data stored on a cryptocurrency's main blockchain, often called the "parent chain."

Typically a person posing as a legitimate user of a product but who is, in fact, being paid or otherwise compensated to promote said product.

An alternative to mining rewards. Staking rewards are earned by putting a certain amount of your cryptocurrency up as a 'stake' to confirm transactions. Rewards are given for doing this.

A computer that is far more powerful than an ordianry computer due to its superior performance.

A memory-intensive hash function designed discourage hacking attempts by requiring large amounts of RAM. It is used by Litecoin, as an alternative to SHA-256.

Secure Hash Algorithm 256. An algorithm used by some Proof of Work consensus mechanisms (most notably, Bitcoin's).

Agreements between two parties that self-execute when their terms are met and automatically cancel when their terms are not met.

A feature of the ARK cryptocurrency which allows separate blockchains to connect with each other and communicate.

Segregated Witnesses. A protocol implemented by Bitcoin to increase transaction speed. SegWit allows more transactions to be written into a single block on a blockchain.

All processes involved in delivering products and services from their providers to their customers.

A measure of how easily a cryptocurrency will be able to handle more users and increased transactions.

A popular exchange service created by Eric Voorhees that allows individuals to trade most altcoins anonymously for a small fee.

The first hardware wallet, created by a Bitcoiner called “Slush.”

Transactions per second. A measure which describes how fast a cryptocurrency can handle its users' transactions.

A computing system that can perform a whole set of computational functions is considered “Turing Complete.”

A consensus method that allows users to transact anonymously and requires relatively little electricity. An alternative to PoW (Proof of Work) and PoS (Proof of Stake). 

A measure that describes how many coins of a given cryptocurrency can exist (after all mining is completed, if applicable).

Transmission Control Protocol/Internet Protocol. A set of protocols that allow multiple computers to communicate.

In the cryptocurrency sphere a Tether is a type of coin. This coin is ‘tethered’ or paired 1-to-1 with the U.S. Dollar.

The ability of a system to be trusted without the need of trusting the individuals with which you are transacting.

Test

A measure of how frequently and how heavily a cryptocurrency is bought and/or sold during a given time period. 

Software preprogrammed to buy, sell, short, long or execute other trading strategies and commands when the owner is absent. Trading while asleep or away from the keyboard.

Software that changes an environment irreversibly after its release. For example, once Bitcoin’s code was launched and distributed amongst many machines, it virtually could not be stopped.

Unspent transaction output. For example, if an individual receives 1 BTC and holds it, they possess a UTXO.

An adult person without an account at a bank or other financial institution. 

Addresses that hold cryptocurrency. Instead of random alphanumeric strings, however, users with vanity addresses can choose specific words and phrases for their addresses, similar to vanity license plates,

Coins which haven’t ever been spent. Virgin coins were mined and left alone.

A highly respected programmer responsible for writing Ethereum's white paper and co-creating Ethereum's technology.

Software or devices that contain public and private keys for storing cryptocurrencies

A very wealthy individual capable of making large trades.

A list of registered and approved participants in an ICO. Whitelists are used to exclude non-accredited investors in order to better comply with regulations.

The native currency of Monero.

Payment that has been broadcast but is still pending inclusion on a blockchain.

A formula that uses data to make predictions about how financially secure businesses are.

Zero-Knowledge Succinct Non-Interactive Argument of Knowledge. Zk-SNARKs is a technology which allows cryptocurrencies to shield transaction information from uninvolved parties.