The truth is that some crypto terms can be intimidating, especially for new users. If this sounds like you, we’ve explained 28 of the most popular crypto terms and acronyms in the simplest way possible.
1. Cryptocurrency
A cryptocurrency is a digital or virtual currency that’s created and secured by a cryptographic algorithm. Cryptocurrencies allow users to transfer assets using the Internet without third-party confirmations or the involvement of a middleman such as a bank or a central authority.
2. Blockchain
A blockchain is a shared database or ledger that is used to record and track transactions within a specific network. What sets it apart from other types of databases is that it stores and encrypts information in groups or “blocks.” These blocks have storage capacities, and when they’re filled, the blocks get linked to a previously filled block and create a new block that forms a chain of data called a blockchain.
3. Mining
In crypto, mining is the thorough process of generating new Bitcoins and several other cryptocurrencies. The process starts with miners verifying transactions and securing blockchains using a decentralized network of computers. The blockchain then rewards the miners with coins which also help provide the means for them to maintain the blockchain.
4. Staking
Crypto staking provides crypto enthusiasts with an opportunity to put their assets to work and earn passive income without actively trading or selling them. It’s the process of committing your assets to support a blockchain network and verify transactions.
5. Burn
A crypto burn refers to the process of permanently removing a certain number of coins or tokens from circulation (which reduces the number of assets available in the market) by sending them to a wallet outside the network.
6. P2P
P2P, which stands for “peer-to-peer,” refers to two users transacting directly with each other, without the involvement of a third party.
7. Bitcoin
Bitcoin is the first-ever cryptocurrency launched by the so-called Satoshi Nakamoto in 2009. It was created in 2008 as a response to the great financial crisis and to provide a P2P payment system that doesn’t involve banks in every transaction. Bitcoin is currently the most popular cryptocurrency and has the largest market capitalization in the market.
8. Altcoin
Altcoin is the shortened version of “alternative coin.” The term refers to any other cryptocurrency in the market aside from Bitcoin. The most popular altcoin nowadays is Ethereum.
9. Stablecoin
A stablecoin is a type of cryptocurrency that pegs or ties its market value to another currency, financial instrument, or commodity. Stablecoins may serve as a “lower-risk” crypto alternative in a highly volatile market. One of the most popular stablecoins is Tether (USDT) which mirrors the value of the U.S. Dollar.
10. NFT
NFT is short for “non-fungible token.” This digital asset is built using the same process that a cryptocurrency goes through, but they’re “non-fungible, " meaning they can’t be traded or exchanged for another. An NFT represents tangible and intangible items such as art, music, collectables, video game items, and more.
11. Coin
Technically speaking, a coin refers to the default cryptocurrency of a specific blockchain network. A good example is Ether, more commonly known as Ethereum, which is the coin of the Ethereum network.
12. Token
Unlike a coin, a token is a type of cryptocurrency that operates using another blockchain network. A good example is the KASTA token, the native cryptocurrency of Ka.app.
13. Crypto Exchange
A crypto exchange is an online platform or a digital marketplace where users can buy, sell, and/or convert crypto and fiat currencies.
14. Wallet
A cryptocurrency wallet is an application that users can use to keep, secure, access, and manage their cryptocurrencies.
15. Wallet Address
A wallet address, also called a public key, is a unique set of letters and numbers that allow you to deposit, withdraw, send, and receive cryptocurrencies. It can be shared with other users just like a phone number or email address.
16. Private Key
A private key is an encrypted code you shouldn’t share with anyone as it provides direct access to your crypto assets.
17. Seed Phrase
A seed phrase, also called recovery or backup phrase, is a set of random words generated when you first set up a crypto wallet. Crypto wallet users are advised to memorise or take note of their seed phrases as they can use these to regain access to their wallets in case they lose their phones or wallet logins. Similar to the aforementioned private key, your seed phrase should never be shared with anyone.
18. Airdrop
An airdrop is a marketing strategy that involves sending tokens or coins to various wallet addresses or active members of a blockchain community to promote a specific currency.
19. ATH
ATH, short for “all-time high,” refers to the highest price or market capitalization that a specific asset has reached since the day it was launched or listed.
20. HODL
It may seem like a misspelling of the word hold, but HODL actually means “hold on for dear life.” It’s a crypto slang that refers to the buy-and-hold strategy wherein the goal is to hold onto specific crypto assets, regardless of the market ups and downs, for potential long-term gains.
21. FUD
FUD is short for “fear, uncertainty, and doubt.” It refers to a strategy or propaganda tactic, such as spreading negative, false, or dubious information, that plants seeds of fear, uncertainty, or doubt or negatively influences the perception of others in a specific cryptocurrency or project.
22. DYOR
DYOR is the acronym for “Do your own research.” Crypto traders often mention this as a disclaimer or a reminder when talking about trading or investing in a specific coin or token.
23. FOMO
In crypto, FOMO is the “fear of missing out” on a specific asset or project that others are enjoying or taking profits on. FOMO may drive a specific person to buy assets at the top and lose or hold profits during a dip and lose them altogether.
24. Shill
Shilling refers to actively promoting or advertising a cryptocurrency to build excitement, attract investors, and eventually increase its value.
25. Whale
A crypto whale is a wallet address that holds a massive amount of cryptocurrency – huge enough that when they withdraw, it’ll make a difference in the currency’s value.
26. Gas
Gas is a pricing mechanism that identifies how much it costs to perform a specific task or transaction (computational resources) in the Ethereum network. To put it simply, the gas cost refers to the amount of work, while the gas price is the cost a user pays for a specific transaction.
27. KYC
KYC stands for either “know your customer” or “know your client.” It’s a verification process that cryptocurrency platforms, perform to identify users, confirm their admissibility to use specific services, and comply with anti-money laundering regulations.
28. DeFi
DeFi, short for decentralized finance, is an umbrella term for financial activities that are performed without the participation of an intermediary, such as a bank, a central authority, or any financial institution.
Final Thoughts
We hope this list of common crypto terms has helped you get a better understanding of how the cryptocurrency market works. Meanwhile, if you’re searching for a way to send crypto quickly, download Ka.app, a P2P crypto payment platform that enables fast and easy cross-border transactions.
