The Crypto Glossary
Here you'll find simple explanations for the most important terms from the world of crypto, blockchain, and NFTs. No jargon, guaranteed!
Airdrop
An airdrop is a free distribution of crypto tokens to a large number of wallet addresses. Projects often use this as a marketing tool to gain attention or to reward early users.
All-Time-High (ATH)
The highest price a cryptocurrency has ever reached.
Altcoin
The term "altcoin" stands for "alternative coin" and refers to any cryptocurrency that is not Bitcoin.
Bear Market / Bull Market
Two terms that describe the general market sentiment. A bull market (the bull thrusts its horns upwards) is a period of rising prices. A bear market (the bear swipes its paw downwards) is a period of falling prices.
Bitcoin (BTC)
The first, most well-known, and largest cryptocurrency, created in 2009 by an anonymous person or group named Satoshi Nakamoto. It is often considered "digital gold" and serves as a decentralized store of value.
Blockchain
The technology behind cryptocurrencies. It can be thought of as a decentralized, digital, and tamper-proof ledger maintained by many computers worldwide.
Exchange / Broker
Platforms where you can buy and sell cryptocurrencies. Brokers (e.g., Bitpanda) are often simpler for beginners, while exchanges (e.g., Binance) offer more options for advanced users.
dApp (Decentralized Application)
An application that runs on a decentralized blockchain instead of a central server of a company. This makes it censorship-resistant and transparent.
DAO (Decentralized Autonomous Organization)
An organization governed by rules encoded in a computer program (smart contracts) rather than by a central leadership. Members often vote on decisions using tokens.
DeFi (Decentralized Finance)
"Decentralized Finance". An umbrella term for financial services on the blockchain that operate without traditional banks. This includes, for example, lending or swapping coins.
Decentralization
The core principle of crypto. It means that no single company, bank, or government has control; instead, power is distributed among all participants in the network.
Diamond Hands / Paper Hands
Slang from the community: Diamond Hands describes investors who hold their coins even during strong price fluctuations. Paper Hands describes people who panic and sell at the first sign of a loss.
Dogecoin (DOGE)
The first and most famous "memecoin," which started as a joke in 2013. Dogecoin has a large and loyal community and is often used for tipping and small transactions.
DYOR (Do Your Own Research)
A fundamental piece of advice in the crypto world. One should never blindly rely on the opinions of others but always research projects themselves.
Ethereum (ETH)
The second-largest cryptocurrency and a decentralized platform that enables the creation of smart contracts and dApps. Ethereum is the foundation for much of the DeFi and NFT world.
FOMO (Fear Of Missing Out)
A dangerous emotion that tempts investors to buy in a panic during rapid price increases, often near the price peak.
FUD (Fear, Uncertainty, and Doubt)
The deliberate spreading of negative (often false) news to drive down the price of a coin.
Gas Fees
Fees paid for a transaction on the network (e.g., on Ethereum). They go to the "miners" or "validators" who keep the network running.
Halving (Bitcoin)
An event that occurs approximately every four years where the reward for mining new bitcoins is halved. This reduces the supply and has historically often led to price increases.
HODL
An intentionally misspelled "hold" that has cult status in the crypto scene. It describes the strategy of holding cryptocurrencies for the long term, regardless of short-term price fluctuations.
KYC (Know Your Customer)
The process by which exchanges like Binance are legally required to verify the identity of their customers (e.g., through an ID upload). It is used to combat money laundering.
Market Cap
The total value of a cryptocurrency. It is calculated by multiplying the current price per coin by the number of coins in circulation.
Memecoin
A cryptocurrency based on an internet meme or a viral joke. Examples include Dogecoin, Shiba Inu, or Pepe. Memecoins are often extremely volatile and rarely have any real technological utility.
Michael Saylor / MicroStrategy
Michael Saylor is the founder of MicroStrategy. He is one of the biggest proponents of Bitcoin and has invested billions in Bitcoin with his company, making him a major figure in the crypto world.
Mining / Staking
Two different methods for securing a blockchain network and creating new coins. Mining (e.g., Bitcoin) involves providing computing power. Staking (e.g., Ethereum) involves "locking up" coins to support the network. Both are rewarded.
NFT (Non-Fungible Token)
A unique digital certificate of authenticity on the blockchain that represents ownership of, for example, art, collectibles, or virtual land.
Pepe (PEPE)
A very popular memecoin based on the "Pepe the Frog" internet meme. It has no specific function; its value is almost exclusively driven by hype and community interest.
Private Key / Seed Phrase
Your secret master key to your coins. The Seed Phrase (usually 12 or 24 words) is the backup for your Private Key. NEVER share either with third parties!
Rug Pull
A scam where the developers of a project artificially inflate the price, then sell all their coins and disappear with the investors' money. The project becomes worthless afterward.
Satoshi (Sat)
The smallest unit of a Bitcoin. One Bitcoin consists of 100 million satoshis. Named after the anonymous creator of Bitcoin, Satoshi Nakamoto.
Shiba Inu (SHIB)
Another very well-known memecoin, often referred to as the "Dogecoin killer." It has a larger ecosystem than Dogecoin, including its own decentralized exchange (ShibaSwap).
Smart Contract
A program on the blockchain that automatically executes when certain conditions are met. They are the foundation for dApps and DeFi.
Stablecoin
A cryptocurrency whose value is pegged to a stable currency like the Euro or US Dollar (e.g., 1 Stablecoin = 1 Euro). It is used to avoid high volatility.
Wallet (Hot & Cold)
Your digital purse. Hot Wallets are connected to the internet (e.g., smartphone apps) and are convenient for everyday use. Cold Wallets are physical devices (like a USB stick) that are offline and provide the highest security for long-term storage.
Web3
The next generation of the internet, based on decentralized blockchain technologies. In Web3, users have more control over their data and digital assets.
Whitepaper
The founding document of a crypto project. It describes the idea, technology, and purpose of the project. Reading the whitepaper is an important step in research.