The A-Z Cryptocurrency Terms Glossary in 20 Words or Less

The A-Z Cryptocurrency Terms Glossary in 20 Words or Less

Although more and more people are becoming aware of cryptocurrencies, much of the language used can seem a bit daunting and peculiar. Unlike conventional money, the ever-growing space of crypto requires some understanding of somewhat complex concepts.

It’s beneficial first to understand that a cryptocurrency is a digital currency facilitated through cryptographic means. For instance, does the term ‘mining’ have any relation to precious metals being dug out of the ground? 

What about blockchain? Luckily, this article has put together a relatively comprehensive A-Z glossary of the phrases any new or experienced enthusiast in cryptocurrencies will likely come across in their journey.

The A-Z crypto glossary of most commonly used jargon

51% attackA malicious attack by a group of miners controlling more than 50% of a blockchain’s mining power
AirdropTypically free distribution of a new cryptocurrency for marketing purposes
Every other coin other than or ‘alternative’ to Bitcoin
ArbitrageThe practice of buying a cryptocurrency from one exchange and selling it to another to profit from price discrepancies
ASIC (application-specific integrated circuit)Customized computer hardware designed to mine cryptocurrencies with astronomically high hash functions
BlockchainThe foundational distributed digital ledger containing a database of blocks linked through cryptography
Block explorerAn online-based application for track in real-time all transactions occurring in a particular blockchain
Bulls/bears (or bullish and bearish)Financial market jargon describing uptrend (bullish) and downtrend (bearish) price movements
Circulating supplyThe total amount of tokens currently in circulation
Cloud miningA cloud-based form of mining using rented processing power without the need for hardware (see mining)
Cold storageThe storing of coins in wallets not connected to the internet (see hot storage)
Consensus mechanismA system used in blockchains for a group of computers to agree to particular datasets
DAO (decentralized autonomous organization)A developer group adhering to and facilitating the processes of a blockchain without a centralized authority
dApp (decentralized application)A type of cryptocurrency-reliant application running without any central authority
DDos(distributed denial of service)A cyber attack where perpetrators make a network unreachable to users by disrupting or overloading its services
DecentralizationThe opposite of centralization where processes occur amongst a network of users 
Double spendingA potential defect in a blockchain where the same token can be spent twice through falsification
ExchangeA business or platform allowing for the trading of cryptocurrencies
Fiat currencyMoney identified as government legal tender: US dollar, euro, etc.
FOMOThe acronym for ‘fear of missing out’
FUDThe acronym for ‘fear, uncertainty, and doubt’
ForkA software change in a blockchain causing a new or altered version of a cryptocurrency
Going long and shortBuying in anticipation of a price increase (long) or selling in anticipation of a price decrease (short) when trading
Halving (or halving)A supply-controlling mechanism where the distribution of a cryptocurrency is reduced in half
Hard capThe maximum supply of a cryptocurrency
Hardware walletA physical device like a USB stick for storing coins considered the most secure compared to a software wallet
HashA computer function decrypting bits of cryptographic data
Hash rateThe speed at which a piece of computer hardware can perform hash functions
Hot storageThe storing of coins in wallets connected to the internet (see cold storage)
HODL/HODLingA slang acronym for ‘hold on for dear life,’ describing the practice of long-term cryptocurrency holding
ICO (initial coin offering)Similar to an IPO (initial public offering); a fundraising and token-distributing process for the launch of a new cryptocurrency
Leverage (or margin)A mechanism offered by exchange or broker allowing for the opening of bigger positions with a smaller balance
LiquidityThe ability for a financial instrument to be easily and quickly bought or sold without affecting its price
Market capitalization (or market cap)Similar to stocks, an indicator of a cryptocurrency’s dominance taken from multiplying its price and circulating supply
Mining A method of computers solving hashes in a blockchain to create new tokens
Mining poolA group of computer owners gathering to mine a cryptocurrency where rewards are distributed proportionately based on the contributing power
Mining rigA set-up of computer equipment or hardware designed to mine a cryptocurrency
Mooning (or ‘going to the moon’)Slang describing a sharp rise in the rise of a cryptocurrency
NodeA computer connected to a blockchain
OracleThird-party services providing external, real-world data to smart contracts
Private keyA long set of alphanumeric characters which act as a digital signature to access a wallet (see public key)
Proof-of-stakeA popular consensus mechanism where transactions are automatically confirmed by a blockchain-based on the stake of investors
Proof-of-workAnother popular consensus mechanism where nodes prove some computational effort has been performed in a blockchain to confirm transactions
Public keyThe unique wallet address used to receive cryptocurrencies
Pump and dumpA fraudulent scheme where a group of traders artificially inflate the price of an instrument through exaggerated statements
Seed phrase (or mnemonic phrase)A collection of designated English words use to recover a cryptocurrency wallet in the event of theft, loss, or damage
ShardingA latency-improving, scalable solution where bits of a blockchain network is split into ‘shards’ or partitions
Smart contractA code-written digital contract designed to execute based on pre-designed conditions autonomously
StablecoinA unique type of cryptocurrency maintaining a stable price by being pegged to another fiat currency, commodity, or algorithmic collateral
WalletA computer application allowing the sending, receiving, and storage of cryptocurrencies
WhaleA wealthy investor who owns substantial amounts of a cryptocurrency

Final word

Cryptocurrencies are perhaps the most fascinating amongst all financial instruments as they continue to challenge the status quo. Although understanding how they work is a bit of a learning curve, it makes more sense as time goes on.

In this article, readers will hopefully better comprehend the common processes in this space by understanding the language.

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