Crypto Glossary
Plain-English crypto definitions
A curated set of 159 definitions for the cryptocurrency terms people search for most. Written for the user, not the engineer. The full What The Block! dictionary covers more than 2,000 terms.
Source: What The Block! Dictionary v1.0 (last updated 2026-04-25).
5
A
Address
A short string of characters that identifies a wallet on a blockchain.
Address Poisoning
A scam that fills your transaction history with addresses that look almost like ones you trust, so you copy the wrong one.
Aggregator
A service that scans many DEXes or lending markets to find you the best rate.
Airdrop
A free distribution of new tokens to a list of wallet addresses. Often used to reward early users.
AML
Anti-money laundering. The rules and checks that stop crypto being used to hide the origin of dirty money.
AMM
Automated market maker. The smart contract behind a DEX that prices trades based on the size of two token pools.
Approval Phishing
A scam where you sign a transaction that grants an attacker permission to move tokens out of your wallet.
APR
Annual percentage rate. The yearly return on a deposit, before compounding.
APY
Annual percentage yield. The yearly return on a deposit, including the effect of compounding.
ATH
All-time high. The highest price an asset has ever reached.
B
Basis
The difference between the spot price of an asset and its futures price.
Bid-Ask Spread
The gap between the highest price buyers will pay and the lowest price sellers will accept.
BIP
Bitcoin Improvement Proposal. The Bitcoin equivalent of an EIP, used to propose changes to Bitcoin.
Bitcoin
The first cryptocurrency. A digital money you can send anywhere in the world without a bank, secured by a network of computers.
Block
A bundle of transactions added to a blockchain together.
Block Explorer
A website that lets you look up transactions, addresses, and blocks on a blockchain.
Block Height
The number of blocks that have been added to a blockchain since its very first one.
Block Reward
The newly minted coins given to whoever produces a new block.
Blockchain
A shared digital record of transactions that no single person or company controls. Everyone can read it, and changes are extremely hard to fake.
Bridge
A tool that lets you move tokens from one blockchain to another.
Burning
Permanently destroying tokens by sending them to an address nobody can spend from. Reduces supply.
C
Capital Gains
The profit you make when you sell an asset for more than you paid. Usually taxable.
CBDC
Central Bank Digital Currency. A digital version of a country's official money issued by its central bank.
Centralised
Run or controlled by a single party. The opposite of decentralised.
CEX
A centralised exchange. A regulated platform where you buy and sell crypto using an account.
Circulating Supply
How many coins or tokens are actually in the market right now and free to trade.
Cold Storage
Keeping crypto on a device that is not connected to the internet. Safer for long-term holding.
Collateral
An asset you lock up to back a loan. If the loan is not repaid, the collateral can be taken.
Confirmation
A measure of how many blocks have been added on top of a transaction's block. More confirmations mean stronger settlement.
Consensus
The way a blockchain's computers agree on which transactions are valid and which version of the ledger is correct.
Cryptocurrency
Digital money that lives on a blockchain instead of in a bank account.
Custody
Who holds your crypto and the keys to it. Self-custody means you do, custodial means a company does.
D
DAO
Decentralised autonomous organisation. A group whose decisions and treasury are managed on a blockchain.
DApp
A decentralised application. A web app whose backend logic runs on smart contracts.
Data Availability
The guarantee that the data behind a block can actually be read and reconstructed by anyone.
Decentralised
Spread across many independent participants, with no single point of control.
DeFi
Decentralised finance. Apps that offer lending, trading, and saving on a blockchain instead of through a bank.
DEX
A decentralised exchange. Trade crypto directly from your wallet, without an account.
Dusting Attack
Sending tiny amounts of crypto to many wallets to track or de-anonymise their owners.
E
EIP
Ethereum Improvement Proposal. The format used to suggest, debate, and document changes to Ethereum.
ERC-1155
A multi-token Ethereum standard that supports both fungible and non-fungible items in one contract.
ERC-20
The Ethereum standard for fungible tokens. Most stablecoins and project tokens follow it.
ERC-721
The Ethereum standard for non-fungible tokens (NFTs).
Ethereum
A blockchain that lets developers build apps and issue tokens. Often called a programmable money platform.
EVM
The Ethereum Virtual Machine. The runtime that executes smart contracts on Ethereum and other compatible chains.
Exit Scam
When the people running a project disappear with users' money.
F
FATF
The Financial Action Task Force. The global standard-setter for anti-money-laundering and counter-terrorist-financing rules.
FCA
The UK's Financial Conduct Authority. The regulator that authorises crypto firms in the UK.
Finality
The point at which a transaction is considered settled and unlikely to be reversed.
FinCEN
The US Financial Crimes Enforcement Network. The agency that enforces anti-money-laundering rules in the United States.
Flash Loan
A loan that is borrowed and repaid inside a single blockchain transaction. No collateral needed.
FOMO
Fear of missing out. The feeling that drives people to buy after a price has already moved a lot.
Fork
A change to a blockchain's rules. Sometimes minor, sometimes big enough to split the network in two.
Fraud Proof
Evidence that an optimistic rollup batch was invalid, used to roll back the bad batch.
Front-Running
Profiting by placing your own transaction ahead of someone else's pending trade.
FUD
Fear, uncertainty, and doubt. Used to describe negative information, real or otherwise, that hurts confidence.
Funding Rate
A periodic payment between long and short perpetual futures traders that keeps the contract close to spot.
Futures
A contract to buy or sell an asset at a fixed price on a future date.
G
Gas
The unit a blockchain uses to measure how much work a transaction takes.
Gas Fee
The cost of getting your transaction included on the blockchain. Goes to the people who run the network.
Genesis Block
The very first block of a blockchain.
Governance Token
A token that gives you the right to vote on changes to a crypto project, usually a DAO.
H
Halving
An event where the reward for mining new Bitcoin blocks is cut in half. Happens roughly every four years.
Hard Fork
A blockchain rule change that is not backwards compatible. Old software cannot follow the new chain.
Hash
A short fingerprint of any piece of data, produced by a one-way mathematical function.
Hash Rate
How much total computing power is securing a proof-of-work network like Bitcoin.
Honeypot
A token or contract designed to lure buyers in and then prevent them from selling.
Hot Wallet
A wallet connected to the internet, like a phone app. Convenient for everyday use, less safe for big balances.
Howey Test
A US legal test for deciding whether something counts as an investment contract, and so a security.
I
K
L
Layer 1
The base blockchain itself, like Bitcoin or Ethereum. The foundation everything else builds on.
Layer 2
A faster, cheaper network built on top of a layer 1 like Ethereum. Borrows the main chain's security.
Lending Protocol
A DeFi app that lets users deposit crypto to earn interest and others borrow against collateral.
Leverage
Trading with borrowed funds, so a small move in the price has a much bigger effect on your position.
Lightning Network
A layer 2 for Bitcoin that lets users send fast, cheap payments through a network of payment channels.
Liquid Staking
Staking your coins through a service that gives you a tradable token in return.
Liquidation
When a borrower's collateral is sold off automatically because their loan has fallen below the safety threshold.
Liquidity Pool
A shared pot of two tokens that lets people trade between them on a decentralised exchange.
Long
A position that profits when the price goes up.
LP Token
A receipt token you get for depositing into a liquidity pool. It tracks your share of the pool.
M
Margin
The capital you put up to open and maintain a leveraged position.
Market Cap
The current price of a coin multiplied by how many are in circulation. A rough size measure.
Market Maker
A participant who quotes both buy and sell prices, providing liquidity in exchange for a small spread.
Memecoin
A token whose value comes mostly from internet culture rather than any underlying product.
Mempool
The waiting area where pending transactions sit before they are included in a block.
Merkle Tree
A way of summarising many pieces of data into a single hash, used to prove a single piece of data is in the set.
MEV
Extra profit that validators or specialised bots can earn by reordering or inserting transactions in a block.
MiCA
The Markets in Crypto-Assets regulation. The European Union's main rulebook for crypto firms.
Mining
Using computers to add new transactions to a blockchain and earn newly created coins as a reward.
Modular Blockchain
A blockchain design that splits responsibilities across separate, specialised layers.
Money Market
A market for short-term borrowing and lending of low-risk assets. In crypto, often a stablecoin lending pool.
Multi-sig
A wallet that needs more than one signature to move funds. Common for companies and treasuries.
N
NFT
A token that represents ownership of a unique item, like a piece of digital art or a ticket.
Node
A computer that helps run a blockchain by storing the ledger and checking new transactions.
Nonce
A number used once. In mining it is the value miners search for; in transactions it stops the same one being processed twice.
O
Open Interest
The total value of outstanding derivatives contracts at a given moment.
Optimistic Rollup
A type of layer 2 that assumes batches are valid by default and lets anyone challenge them.
Options
A contract that gives the buyer the right, but not the obligation, to buy or sell at a set price by a set date.
Oracle
A service that brings outside information, like prices or sports scores, onto a blockchain.
Order Book
A live list of buy and sell orders at different prices on an exchange.
OTC Desk
An over-the-counter trading desk that matches large crypto buyers and sellers off the public exchanges.
P
Permissionless
A property of a system where anyone can use it or join without asking permission.
Perpetual Futures
A futures contract with no expiry date. Common in crypto, kept in line with the spot price by funding payments.
Phishing
A scam where attackers impersonate a trusted service to steal credentials or trick you into signing a bad transaction.
Pig Butchering
A long-running scam that builds a fake personal relationship before steering the victim into fraudulent crypto investments.
Private Key
A secret string of characters that proves you own a crypto address. Anyone who sees it can spend your funds.
Proof of Stake
A way to secure a blockchain using locked-up coins instead of computing power. Used by Ethereum.
Proof of Work
A way to secure a blockchain by making computers do a lot of calculation. Used by Bitcoin.
Pseudonymous
Identified by an address rather than a real name, but still trackable on chain.
Public Key
An address-like value that other people use to send you crypto. Safe to share.
Pump and Dump
A market manipulation where insiders inflate the price of a token, then sell into the buying frenzy.
R
Reentrancy
A smart contract bug that lets an attacker call back into a contract before its first call finishes, draining funds.
Restaking
Reusing already-staked coins as security for additional services, usually for extra yield.
Rollup
A type of layer 2 that bundles many transactions together and writes a summary back to the main chain.
Rug Pull
A scam where the creators of a token suddenly drain liquidity or sell their stash, leaving holders with worthless tokens.
S
Sanctions Screening
Checking that the people and addresses involved in a transaction are not on a sanctions list.
Sandwich Attack
A specific MEV trade where a bot places one order before and one after your trade to extract value.
SEC
The US Securities and Exchange Commission. The American regulator that decides whether a token counts as a security.
Securities
A regulated category of financial instrument, like shares or bonds. Tokens that meet the test are subject to strict rules.
Seed Phrase
A list of 12 or 24 ordinary words that backs up an entire wallet.
Sequencer
The operator that orders transactions on a layer 2 before they are posted to the main chain.
Short
A position that profits when the price goes down.
Sidechain
A separate blockchain that runs alongside a main chain and is connected by a bridge.
SIM Swap
An attack where a scammer takes over your phone number to bypass two-factor authentication and break into accounts.
Slashing
When part of a validator's stake is destroyed as a penalty for breaking the rules.
Slippage
The gap between the price you expected when you placed a trade and the price you actually got.
Smart Contract
A program that runs on a blockchain and does what it says, automatically.
Soft Fork
A blockchain rule change that is backwards compatible. Old software still works, just with fewer features.
Solidity
The most common programming language for writing smart contracts on Ethereum.
Spot Market
A market for buying and selling crypto for immediate delivery, at the current price.
Stablecoin
A token designed to hold the same value as a regular currency, usually the US dollar.
Staking
Locking up your crypto to help run a blockchain. In return, you earn rewards, similar to interest.
State Channel
A way for two or more users to transact off-chain and only settle the final balance on the main chain.
Sybil Attack
An attack where one party controls many fake identities to gain influence.
T
Tax Lot
A specific batch of crypto bought at a known price and date, used to calculate gains on disposal.
Token
A unit of value created on top of an existing blockchain like Ethereum.
Tokenomics
The economic design of a token: total supply, how it is distributed, and how it changes over time.
Total Supply
The maximum number of coins or tokens that will ever exist for a project.
Transaction
An instruction recorded on a blockchain that moves value or runs a smart contract.
Travel Rule
A regulation that requires crypto firms to share sender and recipient information when transferring above a threshold.
Trustless
A system where users do not need to trust each other or a central party for it to work as expected.
TVL
Total value locked. The dollar value of all assets sitting inside a DeFi protocol or chain.
V
Validator
A participant in a proof-of-stake network who proposes and confirms new blocks. Earns rewards and can be slashed.
Validity Proof
A cryptographic proof that a batch of transactions on a ZK-rollup followed all the rules.
VASP
Virtual Asset Service Provider. A FATF term for any business that handles crypto on behalf of customers.
Vault
A DeFi smart contract that automates a strategy on behalf of depositors.
Vesting
A schedule that releases tokens to founders, investors, or staff gradually over time.
W
Wallet
An app or device that holds the keys you need to spend and receive crypto.
Wash Trading
Buying and selling the same asset between connected accounts to fake trading volume.
Web3
A loose label for the part of the internet built on blockchains, wallets, and tokens.
Whale
A person or entity that holds a very large amount of a coin or token, big enough to move the market.
Whitepaper
A document that explains how a crypto project works and why it should exist.
Wrapped Token
A token on one blockchain that represents a coin from another. Lets you use Bitcoin on Ethereum, for example.