Table of Contents
The world of cryptos and trading is full of slang and technical terms whose meaning may not be clear at first reading. Here’s an explanation of the most common repetitive words. This dictionary contains key terms from the world of trading and cryptocurrencies that are essential for every trader, investor, or blockchain enthusiast. The terms are arranged alphabetically and explained in an easy-to-understand manner.
A
Airdrop – The distribution of cryptocurrencies for free to users, often as a marketing strategy or a reward for holding other tokens.
Algorithmic Trading – Automated trading based on predefined algorithms.
All-Time High (ATH) – The highest price an asset has ever reached.
All-Time Low (ATL) – The lowest price an asset has ever reached.
Altcoin – Any cryptocurrency other than Bitcoin (e.g., Ethereum, Cardano, Solana).
AML (Anti-Money Laundering) – Laws and regulations against money laundering, commonly implemented on exchanges.
Arbitrage – A strategy that exploits price differences between exchanges to profit by buying on one and selling on another.
Ask Price – The lowest price at which a seller is willing to sell an asset.
B
Bagholder – An investor who holds an asset that has significantly lost value, hoping for its recovery.
Bear Market (Bearish Market) – A period of declining prices and negative market sentiment.
Bear Trap – A situation where the price of an asset temporarily drops below a key level, only to rise sharply, liquidating short traders.
BEP-20 – A token standard for Binance Smart Chain (BSC), similar to ERC-20 on Ethereum.
Bid Price – The highest price a buyer is willing to pay for an asset.
Bitcoin (BTC) – The first and most well-known cryptocurrency based on blockchain technology.
Block – A unit of data containing transactions in a blockchain.
Blockchain – A decentralized digital ledger that records transactions through linked blocks.
Block Reward – The reward miners receive for verifying and adding a new block to the blockchain.
Bollinger Bands – A technical analysis indicator that measures market volatility and potential overbought or oversold areas.
Bull Market (Bullish Market) – A period of rising prices and positive market sentiment.
Burning – The process of permanently removing tokens from circulation to reduce supply and potentially increase value.
C
Candlestick – A graphical element in technical analysis that represents an asset’s price over a specific time period.
CeFi (Centralized Finance) – Financial services provided by centralized institutions, such as cryptocurrency exchanges.
Centralized Exchange (CEX) – A cryptocurrency exchange operated by a central entity (e.g., Binance, Coinbase).
Circulating Supply – The number of coins or tokens currently in circulation.
Cold Wallet – A cryptocurrency wallet that is not connected to the internet, making it safer from hackers.
Correction – A temporary price drop after a strong upward movement, usually between 10-30%.
Crypto Exchange – A platform for buying, selling, and trading cryptocurrencies.
D
DAO (Decentralized Autonomous Organization) – A decentralized organization governed by the community through smart contracts.
Day Trading – Short-term trading where positions are opened and closed within a single day.
DeFi (Decentralized Finance) – A financial ecosystem built on blockchain that operates without intermediaries like banks.
Divergence – A situation where the asset price and an indicator (e.g., RSI) move in opposite directions, signaling a trend reversal.
Double Top / Double Bottom – A chart pattern indicating a potential trend reversal in the form of a double peak or trough.
Dump – A sharp decline in the price of an asset, often caused by large sell-offs.
DYOR (Do Your Own Research) – A recommendation that investors should conduct their own research instead of relying solely on external advice.
E
EIP (Ethereum Improvement Proposal) – A proposal for improving the Ethereum network that can change its functionality.
EMA (Exponential Moving Average) – A moving average that gives more weight to recent data and reacts faster to price changes.
ERC-20 – A standard for tokens created on the Ethereum blockchain, used for most cryptocurrency projects on this network.
ERC-721 – A standard for NFTs (non-fungible tokens) that enables the creation of unique digital assets.
Escrow – A smart contract or intermediary that holds funds during a transaction until conditions are met.
ETP (Exchange-Traded Product) – Tradable financial products such as ETFs or ETNs that track cryptocurrency prices.
Exit Scam – A situation where cryptocurrency project founders disappear with investors’ money.
F
Fair Launch – The launch of a cryptocurrency without pre-mining or allocated tokens for founders.
Fear and Greed Index – An indicator measuring investor sentiment in the cryptocurrency market.
Fiat Currency – Traditional currency issued by governments, such as USD, EUR, or CZK.
Flash Loan – An advanced DeFi tool that allows borrowing without collateral, as long as the loan is repaid within the same transaction.
Flippening – The hypothetical moment when Ethereum surpasses Bitcoin in market capitalization.
Fork – A blockchain split into two branches, leading to the creation of a new cryptocurrency (e.g., Bitcoin Cash from Bitcoin).
FOMO (Fear of Missing Out) – The fear of missing an investment opportunity, often leading to impulsive purchases.
FUD (Fear, Uncertainty, Doubt) – The spread of fear, uncertainty, and doubt about an asset, often to manipulate the market.
G
Gas Fees – Fees for executing transactions on the blockchain (especially Ethereum).
Golden Cross – A bullish signal in technical analysis where a short-term moving average crosses above a long-term moving average.
GPU Mining – Mining cryptocurrencies using graphics cards, commonly used for Ethereum before its transition to PoS.
Grid Trading – An automated trading strategy that places buy and sell orders at predetermined price levels.
H
Halving – An event where the Bitcoin mining reward is cut in half, historically leading to price increases.
Hard Cap – The maximum number of tokens that can be issued in a project.
Hash Rate – A metric measuring the computing power of a blockchain network in processing transactions.
HODL – Originally a typo of “hold,” now a commonly used term for long-term cryptocurrency holding.
Hot Wallet – A cryptocurrency wallet connected to the internet, suitable for daily transactions but less secure than cold wallets.
I
ICO (Initial Coin Offering) – A fundraising method in which a cryptocurrency project sells tokens to investors before launch, similar to an IPO in stocks.
IDO (Initial DEX Offering) – A fundraising method in which a project launches its token through a decentralized exchange (DEX) rather than a centralized one.
Impermanent Loss – A temporary loss of funds that liquidity providers experience in DeFi protocols due to price fluctuations of the deposited assets.
Index Fund – A diversified investment fund that tracks the price of multiple cryptocurrencies, reducing risk through portfolio diversification.
Inflationary Token – A token with an increasing supply over time, which may lead to depreciation if demand does not grow accordingly.
Interoperability – The ability of different blockchain networks to communicate and interact with each other, enabling seamless asset transfers and smart contract execution across chains.
Institutional Investor – Large financial entities such as hedge funds, banks, or investment firms that allocate significant capital into cryptocurrency markets.
J-K
JOMO (Joy of Missing Out) – The opposite of FOMO, where investors feel relief for avoiding risky trades that resulted in losses for others.
Junk Coin – A cryptocurrency with little to no utility, often created as a scam or with no real development roadmap.
K-line Chart – Another name for candlestick charts, commonly used in technical analysis to visualize price movement.
KYC (Know Your Customer) – A mandatory process where cryptocurrency exchanges verify the identity of users to comply with anti-money laundering (AML) regulations.
L
Layer 1 – The base layer of a blockchain network, such as Bitcoin, Ethereum, or Solana, where transactions and smart contracts are executed.
Layer 2 – Secondary protocols built on top of Layer 1 blockchains to enhance scalability, reduce fees, and increase transaction speed (e.g., Lightning Network for Bitcoin, Optimistic Rollups for Ethereum).
Leverage – Borrowing funds to increase the size of a trading position, amplifying both potential profits and risks.
Liquidity – The ease with which an asset can be bought or sold in the market without significantly affecting its price.
Liquidity Pool – A smart contract containing pooled funds that traders use for decentralized swaps in DeFi platforms like Uniswap and PancakeSwap.
Limit Order – A trading order that executes only when the asset reaches a specific price set by the trader.
Long Position – A trading strategy where an investor buys an asset expecting its price to increase over time.
M
MACD (Moving Average Convergence Divergence) – A technical indicator used to identify trend reversals and momentum in trading.
Mainnet – The fully developed and operational version of a blockchain where actual transactions take place, as opposed to testnets used for development.
Margin Trading – A trading method where investors borrow funds to increase their exposure to an asset, allowing for higher gains but also increasing risks.
Market Capitalization (Market Cap) – The total value of a cryptocurrency, calculated as total supply × price per unit.
Market Order – A trade executed immediately at the current market price.
Market Maker – A trader or entity that provides liquidity to the market by placing large buy and sell orders.
Masternode – A full node in a blockchain network that supports operations such as validating transactions and earning rewards (e.g., Dash masternodes).
Metaverse – A digital universe combining virtual reality, blockchain, and decentralized ownership of assets, often using NFTs (e.g., Decentraland, The Sandbox).
Mining – The process of validating transactions and securing a blockchain network through computational power (Proof-of-Work).
Mining Pool – A group of miners who combine their computing power to increase their chances of earning rewards from block validation.
Moving Average (MA) – A technical indicator that smooths price fluctuations to help identify trends (e.g., SMA, EMA).
N
NFT (Non-Fungible Token) – A unique, indivisible digital asset stored on the blockchain, commonly used for art, collectibles, and gaming assets.
Node – A computer or server that maintains a blockchain by validating transactions and storing historical data.
Nonce – A unique number used in cryptographic operations such as mining to generate valid blocks.
No-Coiner – A person who does not own any cryptocurrency and often remains skeptical about its adoption.
Nuke – Slang for a dramatic price crash of a cryptocurrency.
O
OBV (On-Balance Volume) – A technical indicator that measures buying and selling pressure based on volume changes.
Oracle – A service that brings external data (e.g., stock prices, weather, sports results) to smart contracts on the blockchain (e.g., Chainlink, Band Protocol).
Order Book – A list of all open buy and sell orders for a particular cryptocurrency on an exchange.
OTC (Over-The-Counter) – Direct trading between two parties outside of an exchange, commonly used for large transactions.
P
P2E (Play-to-Earn) – A gaming model where players earn cryptocurrency or NFTs as rewards for in-game activities (e.g., Axie Infinity).
Paper Hands – A term used to describe investors who sell their assets too early due to fear, missing out on potential gains.
Pegged Asset – A digital asset tied to the value of another asset (e.g., USDT is pegged to the US dollar).
P2P (Peer-to-Peer) – A decentralized method of transactions where users interact directly without intermediaries.
Pump and Dump – A market manipulation scheme where an asset’s price is artificially inflated (pumped) before being rapidly sold off (dumped) for profit.
Q-R
QR Code – A scannable code used for quick cryptocurrency transactions by encoding a wallet address.
Rekt – Slang for experiencing significant losses in a trade.
Resistance – A price level where selling pressure is expected to be strong, preventing further upward movement.
Rug Pull – A type of cryptocurrency scam where developers abandon a project and steal investors’ funds.
RSI (Relative Strength Index) – A momentum indicator measuring whether an asset is overbought or oversold (above 70 = overbought, below 30 = oversold).
S
Scalping – A trading strategy that focuses on making small, quick profits through multiple trades within short time frames.
Seed Phrase – A recovery phrase consisting of 12-24 words used to restore access to a cryptocurrency wallet.
Short Position – A trading strategy where a trader borrows an asset to sell it at a high price, aiming to buy it back at a lower price for a profit.
Slippage – The difference between the expected price of a trade and the actual executed price, often occurring during high volatility.
Smart Contract – A self-executing contract stored on the blockchain, automatically enforcing terms without intermediaries.
Stablecoin – A cryptocurrency designed to maintain a stable value by being pegged to an external asset like USD (e.g., USDT, USDC).
Stop-Loss – A pre-set order to sell an asset when its price reaches a certain level to minimize losses.
T-Z
Take-Profit – A pre-set order to sell an asset when its price reaches a certain level to lock in gains.
Technical Analysis (TA) – The study of price charts and indicators to predict future market movements.
Testnet – A sandbox version of a blockchain network used for development and testing before deployment on the mainnet.
Tokenomics – The economic model of a cryptocurrency project, including supply, inflation, and token utility.
TVL (Total Value Locked) – The total amount of assets staked or locked in DeFi protocols.
Volatility – The degree of price fluctuations in an asset over time.
Whale – A large investor whose trades can significantly impact the market.
Whitepaper – A document outlining the technology, purpose, and vision of a cryptocurrency project.
Yield Farming – A DeFi strategy where users provide liquidity to earn rewards.
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