Crypto Glossary for Beginners
Learning a new language is a daunting task for anyone — and diving into the crypto world as a beginner sparks similar feelings of confusion and frustration. With so many new terms being casually thrown around, it’s a great idea to approach your initial days in the space as you would when learning a new language, taking care to learn popular words and phrases that’ll most likely make your journey easier and help you get from A-B a lot quicker.
Remember, you’re not alone. Cryptocurrency is a world of its own and learning the basics takes time, even for seasoned traditional investors. Don’t worry, we’ll have you up to date with all the acronyms and keeping up with the latest memes and tweets in no time!
Here are some of the terms and phrases that will help beginners better understand the world of crypto investing.
Bitcoin — the most popular and valuable cryptocurrency, founded in January 2009.
Block — groups of data within a blockchain comprising of transaction records as users buy or sell coins. Once it reaches its info limit, a new block is formed and the chain is continued accordingly.
Blockchain — the foundation of technology behind cryptocurrencies used as a digital form of record keeping.
Altcoin — any coin that’s not Bitcoin.
HODL / Hold on for Dear Life — the strategy of buying and holding onto cryptocurrency instead of trading it frequently.
ICO / Initial Coin Offering — fundraising for new cryptocurrency projects, similar to stock IPOs.
Decentralization — removing power from a central point, an important concept used in blockchains that need majority approval from all users to operate and make changes.
DeFi / Decentralized Finance — financial activities conducted without a bank, government, or financial institution involved.
Exchange — digital marketplace that facilitates buying and selling of cryptocurrency.
Market Cap — total value of all mined coins that have been mined calculated by multiplying the current number of coins by the coins current value.
NFTs (Non-fungible Tokens) — units of value used to represent the ownership of digital assets like artworks etc.
Public Key or Wallet Address — similar to your bank account number and sharable in order to receive money or make authorized payments.
Private Key — similar to your bank account password, you should never share your private key as it will allow direct access to your cryptocurrency
Stablecoin / Digital Fiat — Digital fiat represents a government-backed currency on the blockchain with its value pegs to the non-digital currency.
P2P (Peer-to-peer) — interactions between two separate parties.
Staking — when parties come together and establish liquidity pools amongst themselves in order to facilitate swaps. People often ‘stake’ tokens into a liquidity pool for a promised rate of return in exchange for the use of their tokens with the option to withdraw their tokens at a later stage.