The Cryptionary: What does HODL mean, and all your other crypto terminology questions answered

The exciting but head-scratching world of crypto has spawned more niche terms and phraseology than a millenial wizard’s TikTok account. So, we’ve put together a glossary to help you navigate this unique sector of finance.

Whether you’re dipping your toe in, or are lost down the rabbit hole, hopefully it proves a useful resource. We’ll keep adding to it, so think of it not as an exhaustive list of cryptocurrency and blockchain-related terms, but an evolving one.

A

Address (cryptocurrency address)
A unique string of alphanumeric (numbers and letters) characters that represent a private wallet, exchange wallet or other blockchain address. Digital assets are sent to and from crypto addresses on secure blockchain networks.

Airdrop
A way to distribute digital assets to a set of crypto addresses for free. Often used as a promotional tactic or to help drive the adoption of a crypto.

All-Time High (ATH)
The highest price point a cryptocurrency has reached in its history.

All-Time Low (ATL)
The lowest price point a cryptocurrency has reached in its history.

Altcoin
An “alternative” coin. Any crypto besides Bitcoin and, arguably, Ethereum. Cardano, XRP, Solana and Dogecoin are all examples of altcoins.

Automated Market Maker (AMM)
An automated decentralised exchange (DEX) where trades are made against a pool of tokens called a liquidity pool (LP). Popular AMMs include Uniswap, Curve and Sushiswap.

ASIC miner
Not to be confused with the Australian Securities and Investments Commission, this is an Application-Specific Integrated Circuit miner – a device that uses microprocessors to “mine” digital currencies, notably Bitcoin.

Atomic swap
This is a specific technique for the exchanging, or swapping, of cryptocurrencies that live on different blockchains. For example, exchanging Bitcoin to Ethereum.

B

Bag holder
An individual who holds a large amount of a crypto. Sometimes used to describe someone holding cryptos that are dwindling in value.

Base currency
The currency against which an exchange rate is quoted. It is the first currency referenced in a pairing such as BTC/USD, for example.

Beacon Chain
The first stage of the launch of Ethereum 2.0, an upgrade to the Ethereum network that has been slowly rolling out in 2021. The Beacon Chain brings the Proof-of-Stake (PoS) consensus model to the Ethereum network, allowing holders to stake their ETH and secure the network as validators.

Bear market
An extended run of declined prices in a market, typically when prices fall 20% or more from recent highs and maintain lower levels. It’s the opposite of a bull market.

Binance
Still the world’s largest global cryptocurrency exchange by trading volume at the time of writing, offering various services including spot trading, futures trading, staking, lending, borrowing and an NFT marketplace.

Bitcoin (BTC)
A huge part of the reason you’re checking out “this crypto thing”. It’s the original cryptocurrency – a peer-to-peer network of nodes that maintain a blockchain-based distributed ledger of BTC balances. Established in 2009, Bitcoin pioneered the Proof-of-Work (PoW) technology for reaching consensus on a decentralised network. Bitcoin is considered a “store of value” to many of its proponents.

Bitcoin Cash (BCH)
Don’t make the mistake that this is Bitcoin (BTC). BCH is a “hard fork” of the Bitcoin network and a completely different crypto in its own right. It pitches itself as a more practical, transactional cryptocurrency than BTC.

Bitcoin dominance
A metric that measures the market cap of BTC in relation to the total market cap of all other cryptocurrencies combined.

Bitcoiner
A Bitcoiner is a holder of Bitcoin and an advocate for the Bitcoin network. Bitcoiners invariably believe Bitcoin is the most important and significant digital asset.

Bitcoin maxi
Like Bitcoiners, but more hardcore with their Bitcoin-only narrative. Those in crypto who believe in a broad ecosystem consider particularly vocal “maxis” to be unnecessarily toxic.

Block
A group of transactional data bundled together in a predetermined size and cryptographically tied to the previous block; collectively forming a chain of blocks (blockchain). Blocks must be validated by the network via a “consensus mechanism” before a blockchain can continue transacting and creating new blocks.

Blockchain
See above. In the case of Bitcoin, for example, a blockchain describes a decentralised public ledger that contains transactional information, maintained by a peer-to-peer network of nodes.

Block explorer
A website or app that allows users to browse and analyse the entire history of a blockchain network.

Block height
The number of blocks between a specific block and the genesis block (the first block of data used to form a new blockchain).

Block reward
Incentives for users securing a blockchain network. In the case of Bitcoin, the reward is the amount of newly minted BTC and transaction fees automatically awarded by the protocol to a miner when they successfully validate a new block.

Bridge
Technology that allows independent blockchains to communicate with each other.

Bubble
The point when an asset or asset class rises to highly inflated price levels. The bubble “pops” when those prices crash – typically by 75 per cent or more. Identifying bubbles and when they might pop is the tricky part.

BUIDL
A deliberate misspelling of “build”. It refers to an ethos that serious crypto and blockchain projects subscribe to: keeping heads down, ignoring price noise and concentrating on innovating the space.

Bull market
The opposite of a bear market. It’s when the “moon Lambo” crowd comes out in full force on social media and you start regularly seeing videos with titles such as “These 5 altcoins will MAKE YOU RICH!”

“Buy the dip”
Sometimes abbreviated to BTD, or even BTFD. A common expression among crypto enthusiasts, which refers to a buying opportunity for an asset or assets.

C

Candlestick
Part of a set of visual technical analysis aids used by stock and crypto investors that shows both real-time and historical prices of a specific asset.

Censorship resistance
A blockchain network’s ability to stay tamper-proof. Decentralised blockchains freely distribute data across a wide range of computers, which makes censorship and modification virtually impossible, or at least extremely difficult.

Central Bank Digital Currency (CBDC)
Not to be confused with the digital currencies the majority of the crypto world covets. These are digital versions of nations’ fiat currencies. China has been in the process of rolling out its CBDC to its citizens in 2021. Several other nations are looking to follow its lead.

Circulating supply
The total number of tokens of a specific cryptocurrency or digital asset currently available in the market. It’s different from “total supply”, which is the total amount of tokens created for a specific crypto asset at its inception.

Cold storage
When the “private keys” for your cryptos are secured offline, impervious to internet hacking attempts. Cryptocurrency wallets with cold-storage capabilities are known as “cold wallets”. The most popular types of cold wallets are hardware wallets and paper wallets.

Confirmation time
The time it takes for an unconfirmed cryptocurrency transaction to be included into the blockchain by miners. Transaction fee size can affect confirmation time.

Cryptocurrency
A digital asset or digital form of money enabled by blockchain technology. Cryptocurrencies are native to particular blockchain networks (eg. BTC to Bitcoin, or ETH to Ethereum).

Cryptography
The study and practice of encrypting and decrypting information through complex mathematics. Cryptography is a significant part of blockchain technology.

D

DAO
Decentralised Autonomous Organisation. This is an organisation completely controlled by its users or stakeholders (in most cases, investors). It has no central governing body, spreading governance to all. DAOs often use a native token to incentivise network participation.

dApp
This is short for “decentralised application”, and refers to an app that is coded in a program running on a smart-contract blockchain network, such as Ethereum.

Dead cat bounce
A technical analysis charting pattern that refers to the temporary price recovery of an asset that has been experiencing a lengthy decline, before continuing its downtrend. It can be considered a type of “fake out” in an asset’s price movement.

Death cross
A bearish technical trading indicator in which the 50-day moving average crosses below the 200-day moving average. This can potentially, although not always, signal a major sell-off. It’s the opposite of a “golden cross”.

Decentralisation
One of the cornerstones, or defining characteristics, of blockchain technology. A decentralised network is an organisation that has no central authority and no centralised points of failure. Bitcoin is the best crypto example of a decentralised system.

DeFi
An abbreviation of “decentralised finance” –a term used to describe financial services-focused crypto projects that are decentralised and not beholden to any central authority.

Distributed ledger
Ledgers that have data stored and synced across a network of nodes (computers that connect to the network).

Dollar coast average (DCA)
Referenced regularly within crypto circles, this is an investment strategy based on the spread of asset purchases. The idea is to buy the asset at regular intervals (e.g. once a month) and in roughly equal amounts.

E

EIP (Ethereum Improvement Proposal)
Proposals to update the Ethereum network with new features. EIP-1559, implemented with Ethereum’s “London” hard fork in July 2021, is one of the best-known EIPs due to its gas-fee burning mechanism – designed to reduce the supply of Ethereum.

ERC-20
One of the most widely used standards to create exchangeable, fungible tokens on Ethereum.

ERC-721
One of the most widely used standards to create non-fungible tokens (NFTs) on Ethereum.

Ethereum (ETH)
An open-source, decentralised, blockchain-based computing infrastructure. Launched in 2015, Ethereum has become a vast ecosystem of interoperable decentralised applications (dApps) fuelled by tokens economies and automated smart contracts. Ethereum is the no.2 crypto by market cap, and is hugely important to the industry for its innovation, including the spawning of DeFi, stablecoins and NFTs.

EVM (Ethereum Virtual Machine)
A core piece of the Ethereum technology stack. It’s the application in which all Ethereum smart contracts are executed.

Exchange
An online platform that allows buyers and sellers to trade a range of cryptocurrencies using fiat currency or other cryptocurrencies.

Exchange-traded fund (ETF)
An investment fund that can be traded on a stock exchange. ETFs can track a collection of securities, such as stocks or bonds, or cryptocurrency, but are tradeable as a single stock. At the time of writing, the US has yet to approve a Bitcoin or Ethereum ETF, although many believe it’s just a matter of time.

F

Fear, Uncertainty and Doubt (FUD)
Can be used to describe negative market sentiment. Can also be used to describe a tactic to deter people from buying a crypto through spreading false information.

Fiat currency
Any type of government-issued currency used as legal tender by a specific nation.

Flippening
A hypothetical moment when the total market cap of Ethereum passes the total market cap of Bitcoin. Many of Ethereum’s biggest fans believe this event is inevitable.

Fundamental analysis
The process of analysing a company or crypto at a fundamental financial level, including assessing the project’s team, roadmap, investors, competitors and so forth.

Futures
A type of financial contract that represents a binding agreement to buy or sell an asset at a specified price and date.

G

Gas
A unit of measurement that relates to the computational effort required to conduct transactions or smart contracts on Ethereum. You need to pay a gas fee every time you make a transaction on the Ethereum network.

Genesis block
The first block of data in a blockchain. The genesis block is also typically referred to as “block zero”.

Golden cross
A bullish technical trading indicator in which a short-term moving average line (eg. The 50-day MA) crosses back above a longer-term moving average (eg. the 200-day MA). This can potentially signal major upwards price movement. The opposite of a “death cross”.

Governance
In the crypto context, governance refers to the formalised structure that a blockchain ecosystem maintains to ensure the integrity, viability, transparency and future of the project. It is the setup of how changes to the network are permitted.

H

Halving
An event scheduled into a blockchain protocol that serves to halve the reward of Proof-of-Work miners that operate in the network. Halvings reduce the rate at which new coins are created, effectively reducing the supply. The most notable “halving” event is Bitcoin’s and occurs every 210,000 blocks, or roughly every four years. In the past, Bitcoin halvings have subsequently resulted in price surges.

Hard fork
A code/software update in a blockchain protocol that creates an entire new blockchain, permanently diverged from its older versions.

Hardware wallet
See “cold storage”. Popular brands of crypto hardware wallet include Trezor and Ledger.

Hash function
A mathematical algorithm that converts an input of data of variable size into an encrypted output of data of a fixed size. The resulting data bundle is known as a “hash”, and “hashing” is an essential part of blockchain management.

Hash rate
The speed at which miners compute hashes. It’s used as the unit of measure for the computing power of a Proof-of-Work consensus mechanism. The hash rate is valued in terahashes per second (TH/s).

HODL
A deliberate misspelling of “hold”, and a rallying cry for crypto investors to “hold on for dear life” and maintain a long-term outlook. The phrase originated in 2013 when a user posted “I AM HODLING” to the Bitcoin Forum message board.

I

ICO (Initial Coin Offering)
A retail-investor-focused fundraising mechanism that incorporates the creation and sale of a token to raise funds for a new cryptocurrency or blockchain project. Many cryptos emerged this way in the ICO boom of 2017/18. In the US there is ongoing conjecture about whether ICO-launched tokens should be considered securities and be subject to Securities and Exchange Commission regulation.

IDO (Initial DEX Offering)
Similar to ICOs, but IDOs refer to the launch of a cryptocurrency on a decentralised exchange (DEX). The crypto project makes its debut on the DEX in order to raise a good deal of its funding from retail investors. IDOs now seem to be a preferred coin-launching method due to their ability to offer more immediate liquidity and a faster route to trading.

Immutability
The inability to be modified, censored or controlled by a central party. Most non-blockchain computer networks are mutable. But immutability allows blockchain networks to ensure the trust and integrity of its data remains intact.

Index fund
An investment product made up of a collection of investments designed to track the returns of an industry segment of a financial market. In crypto, an index fund might track a basket of various DeFi projects, for example.

Internet of Things (IoT)
A system that enables devices connected to the internet to communicate and share data with each other, without the need for human interaction or input.

Interoperability
The compatibility of different blockchain networks and the extent to which they can use and leverage each other’s unique characteristics.

K

Kimchi Premium
The price difference in Bitcoin between South Korean cryptocurrency exchanges and other global crypto exchanges.

KYC (Know Your Customer)
A compliance process required by regulators for crypto businesses (and fintechs generally) to verify the identity and risk level of their clients.

L

Layer 1 blockchain
Typically a name used to describe a main blockchain network such as Bitcoin, Ethereum, Cardano or Solana, for example.

Layer 2 scaling solution
Protocols that integrate into layer 1 blockchains (such as Bitcoin and Ethereum) as secondary layers. They’re generally designed to increase transactional throughput and reduce transaction costs on the layer 1 chain.

Leverage trading
A risky investment strategy involving the use of borrowed funds which allows traders to open a position larger than the balance of their account.

Lightning Network
Bitcoin’s layer 2 scaling technology that significantly helps reduce network congestion and increases transactional throughput.

Liquidity
The ability to buy or sell a particular cryptocurrency in the market without substantially affecting its price.

Liquidity Pool (LP)
A collection of crowdsourced funds, in the form of specific pairings of crypto tokens, locked in a smart contract. LPs are used to facilitate decentralised trading, lending, and more.

M

Magic internet money
A tongue-in-cheek term for Bitcoin and other cryptocurrencies.

Mainnet
A fully developed and deployed version of a blockchain network.

Market capitalisation (market cap)
In the blockchain industry, this represents the value of the entire supply of a cryptocurrency or token. It’s calculated by multiplying circulating supply by market price.

Maximum supply
The absolute maximum number of coins or tokens that will ever exist in the duration of a specific digital asset. Note: not the same as “total supply”.

Memecoin
A crypto token based on a viral phenomenon, joke or cultural reference. Dogegoin (DOGE) is the most famous memecoin and the personal favourite of Elon Musk.

Mempool
Short for “memory pool”, a mempool is a collection of all cryptocurrency transactions waiting to receive their first confirmation from a miner.

Merkle tree
A structure of data made up of data-converting “hashes”, used by blockchains for the purpose of verifying information securely.

Metaverse
A shared virtual reality world, which is a concept visualised in the films Ready Player One and Free Guy.

Mining
The process of contributing computing resources to verify transactions and record them on a blockchain. Mining is performed by “miners” and, in exchange for their work, they’re rewarded with cryptocurrency.

Moon
“To the moon” is classic crypto slang that relates to the euphoria around crypto prices rising. When a coin is really pumping, it is said to be “mooning”.

Multi-signature
Crypto wallets that have a digital signature scheme, requiring more than one user to authorise a cryptocurrency transaction.

N

Node
In a blockchain, nodes are computers that connect to the network and communicate with other nodes to maintain network security and integrity, as well as validate transactions.

NFT (non-fungible token)
NFTs are tokens representing 100 per cent unique digital-content items. Non-fungible means not interchangeable. In other words, “there can be only one”. This is unlike fungible assets such as Bitcoin and other cryptos, which have supplies of tokens.

O

Off-chain
Refers to instant transactions occurring outside the blockchain.

Off-ramp
A solution through which investors and traders can convert cryptocurrencies to fiat currencies. Off-ramps are offered by most leading cryptocurrency exchange operators. Not all traditional financial institutions are willing to participate, however, so it’s best to find out if your bank is anti-crypto.

On-ramp
A solution through which investors and traders can convert fiat currencies to cryptocurrencies.

Open source
Code or software that is made publicly accessible and readily shareable for anyone to use or modify as they see fit for their own purposes. One of crypto’s defining characteristics is a shared landscape of open-source software that, in theory, helps the entire space grow together.

Optimistic Rollups
Layer 2 scaling technology that bundles thousands of sidechain transactions into a single transaction verified and settled on Ethereum.

Oracle
Protocols that serve to verify real-world (off-chain) data and provide that data securely to smart contracts on blockchains.

P

Peer to peer
Communication that doesn’t require a central hub to facilitate.

Play to earn (P2E)
One of the latest developments in the gaming industry, the play-to-earn (P2E) model gives gaming enthusiasts control and ownership over in-game assets as well as incentivising them to play P2E games, thus contributing to the overall in-game economy. Play-to-earn games are perfectly suited to the open-economy ideals and attributes of blockchain and crypto.

Pre-sale
An exclusive crypto-token sale event that precedes, for example, a public IDO.

Privacy coins
These are cryptos built to have transactional anonymity and user privacy. Monero (XMR) is a well-known privacy coin.

Private key
A unique alphanumeric string of letters and numbers that functions as a user’s digital signature for authorising transactions. Never share your private key. Let’s say that again… Never share your private key.

Proof of Stake (PoS)
A blockchain consensus mechanism in which participants “stake” a PoS blockchain’s tokens in a network of validator nodes. To stake means to lock the given crypto assets within the system. Stakers are incentivised by receiving annualised crypto-token returns.

Proof of Work (PoW)
A blockchain consensus mechanism used by the Bitcoin network, among others. It involves a process of “mining” to maintain the network. Cryptocurrency miners use specific hardware that expends computing power to solve complex cryptographic puzzles required to confirm data transacted on the network. They are rewarded for doing so with the network’s native crypto token – for example, BTC.

Public address
An abridged version of a user’s alphanumeric public key that’s used to receive crypto transactions through a blockchain network.

Public key
A unique string of letters and numbers visible on a blockchain. It’s cryptographically paired with a private key, and allows you to receive crypto transactions. Unlike private keys, however, public keys can be safely shared for transactional purposes.

Pump and dump
A market-manipulation scheme in which large holders of an asset drive up the price through heavy promotion before quickly selling off and profiting at an inflated price, leaving unsuspecting late investors “rekt” with heavy losses.

Q

Query

A specific request for data or information from a computer database. Query languages are programming languages used to create queries in information systems.

R

Rekt
A slang version of the word “wrecked”. In crypto terms it can mean financially destroyed or ruined, or it can simply refer to heavy losses: “Aw nuts, SafeMoon dumped and now I’m rekt. I really should’ve stuck with BTC and ETH.”

Rug pull
Generally speaking, rug pulls are blatant exit scams involving the sudden removal of liquidity of funds from a project that had made lofty claims to entice investors.

S

Satoshi (sat)
The smallest divisible unit of a Bitcoin. One Bitcoin equals 100 million satoshis, and one satoshi equals 0.00000001 BTC. The plural – satoshis – is commonly shortened to “sats”.

Satoshi Nakamoto
The pseudonym used by the anonymous person or people who invented Bitcoin. Outspoken and controversial Australian tech entrepreneur Craig Wright claims he is Satoshi. Finding someone who believes him is close to impossible.

Seed phrase
Also known as a mnemonic phrase, a seed phrase is typically 12 or 24 words in length and stores the information needed to recover a wallet. If you’re storing your own crypto on a hardware wallet or any kind of wallet, you’ll generate a seed phrase. As with private keys, it’s important to keep this secure and never pass it on to anyone you don’t implicitly trust.

Sentiment analysis
A form of research that aggregates a large amount of information (mostly from social media) regarding market participants’ overall attitudes. Santiment is one example of an analytics firm that specialises in crypto market sentiment.

Shitcoin
A crypto that has no, or little, actual usage or value. Also used as a term to put down certain cryptocurrencies. “Bitcoin maxis” regard all cryptos that aren’t Bitcoin as shitcoins.

Sidechain
An external, secondary blockchain that is connected to a primary blockchain network (mainchain).

Slippage
The difference between the expected price of a trade relative to the actual price at which the trade executes.

Smart contract
Self-executing computer code able to be stored and executed on a blockchain. Smart contracts carry out a set of instructions and are programmed to execute when predetermined conditions are met. These contracts are decentralised, “trustless” and irreversible and unmodifiable once deployed.

Solidity
The software programming language developed specifically for Ethereum.

Stablecoin
A type of cryptocurrency designed to keep its price pegged to that of fiat currencies or commodities such as gold. Their purpose is to maintain as stable a price as possible. USDT, USDC and USDP are examples.

Staking
The process of locking up tokens in order to participate as a validator of a Proof-of-Stake blockchain network, in order to be incentivised with annualised returns in that same token.

T

Technical analysis (TA)
The process of forecasting the direction of an asset’s price movements based on historical price and volume data. Crypto TA proponents examine specific patterns on trading charts and graphs. There are hundreds of different metrics and indicators than can be utilised in TA.

Testnet
An alternative blockchain network that is used, mainly by developers and programmers, for testing and experimentation purposes. A good example of an ongoing testnet, which is a highly successful crypto project in its own right, is Kusama (KSM), which functions as a testnet for the Polkadot network.

Token
A unit of value that represents a digital asset or cryptocurrency. Sometimes also referred to as a “coin”.

Token burn
An occurrence in which tokens are deliberately and permanently removed from circulation.

Tokenomics
This refers to the economic structure of a cryptocurrency token – how it is produced and distributed over time, and how it is utilised within the project’s ecosystem.

Total supply
The complete number of tokens created by a blockchain project at inception. This includes the amount allocated to the team, advisors, foundation and community, and may include vested tokens. It’s different from circulating supply, which changes regularly, and from maximum supply, which is the maximum amount of tokens that will ever exist in the asset’s lifetime.

Total value locked (TVL)
The number of assets staked in a protocol, or the total quantity of underlying funds that a DeFi protocol has secured.

Trading volume
The amount of a given cryptocurrency that has been traded in the past 24 hours.

Transaction ID (TXID)
A permanent, immutable record of a digital transaction that has been recorded on a blockchain.

Transactions per second (TPS)

The number of data transactions a blockchain network can execute within a second. Sometimes used as an indicator for a smart-contract protocol’s overall network speed and performance.

Trustless
Peer-to-peer blockchain networks are trustless – meaning they are systems that don’t require the trust of third-party verification (from a central bank, for example) for transactions and contracts to execute securely and accurately.

U

Utility token
A crypto token that performs specific utilities on a network other than simply being used for a medium of exchange or investment.

V

Vitalik Buterin
A Russian-Canadian programmer and writer best known for being the main individual behind the creation of Ethereum. (And for wearing a llama-corn UFO rainbow T-shirt.)

Volatility
This refers to the level of fluctuation of an asset’s trading prices. Rising volatility is generally associated with uncertainty among traders and investors.

W

Wallet
A software application or hardware device that stores and manages a user’s public and private keys, facilitating the sending and receiving of crypto assets.

Web3
The vision of a serverless internet or decentralised web. It describes a third generation of the internet, being built and realised with blockchain, where each user is in control of their own data and identity.

Whitepaper
A project’s introductory manifesto of sorts. It’s a document prepared by the founders detailing the project’s purpose, its solution to the problem it’s trying to solve, technical features and more.

X

XRP
A cryptocurrency created by Ripple Labs, designed primarily as a medium of exchange and a low-cost bridge between fiat currencies for a range of fast and seamless global transactions.

Y

Yield farming
A way to generate passive income by providing liquidity – or another value-added service – to a DeFi protocol. Income comes from trading fees and is received is in the protocol’s native crypto token.