Blockchain
Definition: A blockchain is a decentralized digital ledger that records transactions across a network of computers. Each “block” contains data that links to the previous one, creating a secure, tamper-resistant chain. Because no single entity controls it, blockchain technology enables transparency, trust, and censorship resistance.
TL;DR: A public record book that no one person controls.
Related terms: Distributed Ledger, Consensus, Smart Contract
Bitcoin (BTC)
Definition: Bitcoin is the first and largest cryptocurrency, launched in 2009 by the pseudonymous Satoshi Nakamoto. It functions as a peer-to-peer digital currency and a store of value, secured by proof-of-work mining. Its capped supply of 21 million coins has made it a popular hedge against inflation.
TL;DR: The original cryptocurrency, designed as digital cash.
Related terms: Proof-of-Work, Halving, Cryptocurrency
Ethereum (ETH)
Definition: Ethereum is a blockchain launched in 2015 that introduced smart contracts — self-executing programs that run on-chain. It powers decentralized applications (dApps), decentralized finance (DeFi), and NFTs. Ether (ETH) is the native token, used for transactions and gas fees.
TL;DR: A programmable blockchain for apps, not just money.
Related terms: Smart Contract, dApp, Gas Fees
Stablecoin
Definition: A stablecoin is a cryptocurrency pegged to a stable asset like the U.S. dollar. It combines blockchain’s speed with price stability. Types include fiat-backed (e.g., USDT, USDC), crypto-collateralized (DAI), and algorithmic (such as UST, which failed in 2022).
TL;DR: Crypto designed to hold a steady value, often $1.
Related terms: USDT, USDC, DAI
DeFi (Decentralized Finance)
Definition: DeFi refers to blockchain-based financial services that operate without banks. Users can lend, borrow, trade, or earn interest directly through smart contracts. While DeFi offers accessibility and innovation, it also carries risks like hacks and volatility.
TL;DR: Finance without banks, powered by smart contracts.
Related terms: Lending Protocol, DEX, Yield Farming
NFT (Non-Fungible Token)
Definition: NFTs are unique digital assets recorded on a blockchain, often representing art, music, collectibles, or gaming items. Unlike fungible tokens like BTC, each NFT is distinct and verifiable.
TL;DR: A one-of-a-kind digital collectible on blockchain.
Related terms: ERC-721, Metaverse, Tokenization
DAO (Decentralized Autonomous Organization)
Definition: A DAO is a community-led organization governed by smart contracts and token holders. Members propose and vote on decisions such as funding or development. DAOs promise transparency but face governance challenges.
TL;DR: A digital organization run by code and community.
Related terms: Governance Token, Voting, Smart Contract
Smart Contract
Definition: A smart contract is a self-executing program stored on a blockchain. It automatically enforces agreements when predefined conditions are met, such as releasing funds only after a shipment is confirmed.
TL;DR: Code on a blockchain that runs itself when conditions are met.
Related terms: Ethereum, DAO, DeFi
dApp (Decentralized Application)
Definition: dApps are applications built on blockchains that run without centralized servers. They use smart contracts for backend logic and often connect with crypto wallets. Examples include Uniswap and Aave.
TL;DR: Apps that run on blockchain instead of traditional servers.
Related terms: DeFi, NFT, Smart Contract
Proof-of-Work (PoW)
Definition: PoW is a consensus mechanism where miners solve computational puzzles to validate transactions and secure the blockchain. It is energy-intensive but highly secure. Bitcoin uses PoW.
TL;DR: A method where miners confirm transactions by solving puzzles.
Related terms: Mining, Proof-of-Stake, Bitcoin
Proof-of-Stake (PoS)
Definition: PoS is a consensus mechanism where validators stake tokens to secure the network and validate transactions. It is more energy-efficient than PoW. Ethereum transitioned to PoS in 2022 via “The Merge.”
TL;DR: A system where validators lock tokens to confirm transactions.
Related terms: Staking, Ethereum, Consensus
Mining
Definition: Mining is the process of validating blockchain transactions and creating new coins, primarily in proof-of-work systems. Miners compete using computing power and are rewarded with new tokens.
TL;DR: Using computing power to confirm blockchain transactions and earn coins.
Related terms: Proof-of-Work, Block Reward, Hash Rate
Staking
Definition: Staking involves locking up cryptocurrency to support a proof-of-stake blockchain. Validators who stake tokens earn rewards for securing the network but risk losing funds if they act dishonestly.
TL;DR: Locking tokens to help run a blockchain and earn rewards.
Related terms: Proof-of-Stake, Slashing, Yield Farming
Gas Fees
Definition: Gas fees are transaction costs paid to blockchain validators. On Ethereum, users pay gas in ETH to execute transactions and run smart contracts. Fees fluctuate based on demand and network activity.
TL;DR: Transaction fees required to use Ethereum and other blockchains.
Related terms: Ethereum, Smart Contract, Transaction
Consensus
Definition: Consensus is the process by which blockchain participants agree on the validity of transactions. Mechanisms include proof-of-work, proof-of-stake, and delegated proof-of-stake.
TL;DR: The way blockchains agree on what transactions are valid.
Related terms: Proof-of-Work, Proof-of-Stake, Distributed Ledger
Distributed Ledger
Definition: A distributed ledger is a database that is replicated, shared, and synchronized across multiple computers. Unlike traditional ledgers controlled by a central authority, distributed ledgers allow participants to verify and store records collectively. Blockchain is the most well-known type of distributed ledger.
TL;DR: A shared record system maintained by many computers, not one authority.
Related terms: Blockchain, Consensus, Decentralization
Altcoin
Definition: Altcoin refers to any cryptocurrency that is not Bitcoin. Examples include Ethereum, Solana, and Cardano. Altcoins often introduce new features, such as smart contracts or faster transactions, but many struggle to achieve long-term adoption.
TL;DR: Any cryptocurrency other than Bitcoin.
Related terms: Bitcoin, Cryptocurrency, Ethereum
Cryptocurrency
Definition: Cryptocurrency is a digital form of money that uses cryptography for security and operates on decentralized networks like blockchains. Cryptocurrencies can be used for payments, savings, or as utility tokens within applications.
TL;DR: Digital money secured by cryptography and powered by blockchain.
Related terms: Bitcoin, Ethereum, Stablecoin
Token
Definition: A token is a digital asset issued on a blockchain. Tokens can represent currency (utility tokens), ownership (security tokens), or unique assets (NFTs). Unlike coins, which operate on their own blockchain, tokens are built on existing blockchains like Ethereum.
TL;DR: A digital asset created on top of an existing blockchain.
Related terms: Coin, NFT, ERC-20
Coin
Definition: A coin is a cryptocurrency that runs on its own native blockchain, such as Bitcoin or Ethereum. Coins usually function as money within their networks, whereas tokens rely on other blockchains for operation.
TL;DR: A cryptocurrency that has its own blockchain.
Related terms: Bitcoin, Ethereum, Token
Wallet
Definition: A crypto wallet is a digital tool that allows users to store and manage cryptocurrencies. Wallets can be custodial (managed by a third party) or non-custodial (controlled fully by the user). They come in software (mobile apps) or hardware (physical devices) forms.
TL;DR: A tool to store, send, and receive cryptocurrencies.
Related terms: Private Key, Hot Wallet, Cold Wallet
Private Key
Definition: A private key is a cryptographic code that grants access to the funds in a crypto wallet. Whoever holds the private key controls the assets. This makes it essential for users to keep their keys secure and private.
TL;DR: A secret code that lets you control your crypto.
Related terms: Wallet, Public Key, Seed Phrase
Public Key
Definition: A public key is a cryptographic code linked to a wallet that can be shared with others to receive cryptocurrency. It is mathematically related to the private key but does not reveal it.
TL;DR: A shareable code that others use to send you crypto.
Related terms: Private Key, Address, Wallet
Seed Phrase
Definition: A seed phrase is a list of 12–24 words that can restore access to a crypto wallet. It is generated when setting up a wallet and must be stored securely, as anyone with the phrase can access the funds.
TL;DR: A backup code of words to recover your wallet.
Related terms: Private Key, Wallet, Custody
Hot Wallet
Definition: A hot wallet is a cryptocurrency wallet connected to the internet, such as a mobile or web app. While convenient for transactions, hot wallets are more vulnerable to hacks compared to offline storage.
TL;DR: An online wallet that’s easy to use but less secure.
Related terms: Cold Wallet, Wallet, Private Key
Cold Wallet
Definition: A cold wallet is a cryptocurrency wallet that remains offline, such as hardware wallets or paper wallets. They provide higher security by keeping private keys away from internet threats.
TL;DR: An offline wallet for maximum crypto security.
Related terms: Hot Wallet, Hardware Wallet, Private Key
DEX (Decentralized Exchange)
Definition: A DEX is a blockchain-based exchange that allows users to trade cryptocurrencies directly from their wallets using smart contracts. Unlike centralized exchanges, DEXs do not hold user funds, reducing custodial risk.
TL;DR: A crypto exchange where users trade directly without intermediaries.
Related terms: DeFi, Liquidity Pool, AMM
CEX (Centralized Exchange)
Definition: A CEX is a cryptocurrency exchange operated by a company that manages user funds and executes trades. Examples include Binance, Coinbase, and Kraken. While user-friendly, CEXs require trust in the platform to safeguard assets.
TL;DR: A company-run crypto exchange that holds your funds.
Related terms: DEX, Custody, KYC
Liquidity Pool
Definition: A liquidity pool is a smart contract where users deposit tokens to enable trading on decentralized exchanges. In return, liquidity providers earn fees or rewards. Pools are essential for automated market makers (AMMs).
TL;DR: A token pool that powers trading on decentralized exchanges.
Related terms: AMM, DeFi, Yield Farming
AMM (Automated Market Maker)
Definition: An AMM is a protocol used by decentralized exchanges that relies on liquidity pools instead of traditional order books. Traders swap assets directly with the pool, and prices are determined algorithmically.
TL;DR: A system that lets traders swap tokens using liquidity pools, not order books.
Related terms: DEX, Liquidity Pool, DeFi
Yield Farming
Definition: Yield farming is a DeFi practice where users lend or stake crypto in protocols to earn rewards, often in the form of additional tokens. It can offer high returns but comes with risks like impermanent loss and protocol hacks.
TL;DR: Earning rewards by lending or staking crypto in DeFi apps.
Related terms: DeFi, Staking, Liquidity Pool
Liquidity Mining
Definition: Liquidity mining is when protocols reward users with tokens for providing liquidity to pools. It became popular during the DeFi boom as a way to bootstrap decentralized exchange liquidity.
TL;DR: Getting tokens as a reward for adding liquidity to pools.
Related terms: Yield Farming, DeFi, AMM
Halving
Definition: A halving is an event in Bitcoin where block rewards given to miners are cut in half, occurring approximately every four years. This reduces the rate of new BTC supply and historically influences price cycles.
TL;DR: Bitcoin event where mining rewards drop by 50% every four years.
Related terms: Bitcoin, Mining, Block Reward
Block Reward
Definition: The block reward is the number of coins awarded to a miner or validator for adding a block to the blockchain. In Bitcoin, this reward halves roughly every four years during the halving event.
TL;DR: Coins earned by miners or validators for creating a new block.
Related terms: Mining, Halving, Proof-of-Work
Hash Rate
Definition: Hash rate is the total computational power used by a blockchain network to process transactions and secure the system. A higher hash rate means greater security against attacks.
TL;DR: The computing power securing a blockchain.
Related terms: Mining, Proof-of-Work, Block Reward
Fiat
Definition: Fiat currency is government-issued money, such as the U.S. dollar or euro. Unlike cryptocurrencies, fiat is not backed by a commodity but by the trust and authority of the issuing government.
TL;DR: Traditional government-issued money like USD or EUR.
Related terms: Stablecoin, Cryptocurrency, Central Bank
KYC (Know Your Customer)
Definition: KYC is a regulatory process where financial institutions and exchanges verify the identity of their customers. It usually requires documents like passports or proof of address to comply with anti-money laundering laws.
TL;DR: Identity checks required by crypto exchanges and banks.
Related terms: AML, CEX, Regulation
AML (Anti-Money Laundering)
Definition: AML refers to laws and regulations aimed at preventing illegal activities like money laundering and terrorism financing. In crypto, exchanges and platforms must implement AML measures through KYC checks and transaction monitoring.
TL;DR: Rules to stop crypto from being used for crime.
Related terms: KYC, Regulation, Compliance
Compliance
Definition: Compliance in crypto means following laws, regulations, and industry standards. This includes meeting AML/KYC rules, reporting requirements, and ensuring products align with financial regulations.
TL;DR: Following the rules and regulations in crypto.
Related terms: KYC, AML, Regulation
Regulation
Definition: Regulation in crypto refers to government rules and oversight for cryptocurrencies, exchanges, and blockchain projects. Regulations vary by country and can impact innovation, investor protection, and adoption.
TL;DR: Government rules for crypto and blockchain companies.
Related terms: AML, KYC, Compliance
Metaverse
Definition: The metaverse is a virtual world that blends augmented reality, virtual reality, and blockchain-based ownership. Users can interact, play, and trade assets such as NFTs within these digital environments.
TL;DR: A shared virtual world powered by blockchain and digital assets.
Related terms: NFT, Tokenization, Web3
Web3
Definition: Web3 refers to the next phase of the internet, built on decentralized technologies like blockchain. It emphasizes user ownership, tokenized incentives, and permissionless access, moving away from centralized control by tech giants.
TL;DR: A decentralized version of the internet where users own their data.
Related terms: Blockchain, dApp, NFT
Layer-1
Definition: A Layer-1 blockchain is a base network, like Bitcoin or Ethereum, that processes and finalizes transactions without relying on other blockchains. They are foundational protocols for crypto ecosystems.
TL;DR: The main blockchain layer where transactions happen directly.
Related terms: Layer-2, Scaling, Consensus
Layer-2
Definition: A Layer-2 solution is built on top of a Layer-1 blockchain to improve scalability and reduce costs. Examples include Lightning Network for Bitcoin and rollups for Ethereum.
TL;DR: A secondary layer that makes blockchains faster and cheaper.
Related terms: Layer-1, Scaling, Rollup
Rollup
Definition: A rollup is a Layer-2 scaling method where transactions are bundled off-chain and then submitted to the main blockchain in a single batch. This increases throughput while maintaining security.
TL;DR: A scaling tool that groups many transactions into one.
Related terms: Layer-2, Scaling, Ethereum
Tokenization
Definition: Tokenization is the process of representing real-world or digital assets as tokens on a blockchain. This can include art, real estate, or securities. Tokenization enables fractional ownership and easier trading.
TL;DR: Turning real-world assets into blockchain tokens.
Related terms: NFT, Stablecoin, RWA
RWA (Real-World Asset)
Definition: RWAs are physical or financial assets, like real estate or bonds, that are represented on a blockchain through tokenization. They bring traditional finance into the crypto ecosystem.
TL;DR: Real-world assets like property or bonds represented on blockchain.
Related terms: Tokenization, Stablecoin, DeFi
