Decentralizovaná, distribuovaná digitální účetní kniha, která zaznamenává transakce na mnoha počítačích, takže záznam nelze zpětně změnit.
Každý blok obsahuje kryptografický hash předchozího bloku, časové razítko a data transakce. Díky této řetězové struktuře je prakticky nemožné změnit historické záznamy, aniž by se změnil každý následující blok. Blockchain mohou být veřejné (jako Bitcoin) nebo soukromé (používané podniky).
Sbírka transakčních dat spojených dohromady a přidaných do blockchainu. Každý blok je propojen s předchozím a tvoří řetězec.
Maximální velikost bloků se liší podle blockchainu - bloky Bitcoin jsou omezeny na přibližně 4 MB, zatímco ostatní řetězce mají jiné limity. Když je blok plný, vytvoří se nový blok. Doba mezi bloky se liší: ~10 minut pro Bitcoin, ~12 sekund pro Ethereum.
Počet bloků v řetězci mezi daným blokem a úplně prvním blokem (blokem geneze).
Výška bloku slouží k odkazování na konkrétní body v historii blockchainu. Například události půlení Bitcoin se vyskytují v určitých výškách bloků. Aktuální výška bloku udává, kolik bloků bylo vytěženo od spuštění řetězce.
Úplně první blok v blockchainu, známý také jako blok 0. Je to základ, na kterém jsou postaveny všechny následující bloky.
Genezi bloku Bitcoin vytěžil Satoshi Nakamoto 3. ledna 2009. Obsahoval zprávu odkazující na novinový titulek: "The Times 03/Jan/2009 Kancléřka na pokraji druhé finanční pomoci bankám" - široce interpretovaný jako komentář k finančnímu systému, pro jehož řešení byl Bitcoin vytvořen.
Počítač, který udržuje kopii blockchainu a pomáhá ověřovat a předávat transakce v síti.
Plné uzly uchovávají celou historii blockchainu a nezávisle ověřují všechny transakce a bloky. Lehké uzly stahují pouze hlavičky bloků a při ověřování se spoléhají na plné uzly. Provozování uzlu přispívá k decentralizaci a bezpečnosti sítě. Uzel může spustit kdokoli - vyžaduje počítač a připojení k internetu.
Rozdělení moci a kontroly z jediné centrální autority na síť účastníků.
V decentralizované síti, jako je Bitcoin, neovládá systém žádný subjekt. Síť spravují tisíce uzlů po celém světě a nikdo nemůže jednostranně měnit pravidla nebo cenzurovat transakce. Míra decentralizace se u jednotlivých blockchainů liší - některé jsou decentralizovanější než jiné.
Databáze, která je sdílená, replikovaná a synchronizovaná na více místech, v různých institucích nebo zeměpisných oblastech - přístupná více lidem.
Blockchain je typ distribuované účetní knihy, ale ne všechny distribuované účetní knihy používají technologii blockchain. Klíčovým rysem je, že účetní knihu neovládá jediný správce. Na změnách se musí shodnout celá síť prostřednictvím konsenzuálního mechanismu.
Samovykonatelný kód uložený v blockchainu, který automaticky vynucuje podmínky dohody, pokud jsou splněny předem definované podmínky.
Ethereum zpopularizoval chytré kontrakty, které umožňují DeFi, NFT, DAO a tisíce dalších aplikací. Jednou nasazený inteligentní kontrakt nelze změnit - kód běží přesně tak, jak je napsán. To eliminuje potřebu zprostředkovatelů, ale také znamená, že chyby v kódu mohou mít nevratné následky.
Měrná jednotka pro výpočetní úsilí potřebné k provedení transakcí nebo chytrých smluv v síti Ethereum.
Poplatky za plyn se platí v ETH a mění se v závislosti na poptávce po síti. Když je síť vytížená, poplatky za plyn se zvyšují - někdy i výrazně. Řešení na druhé vrstvě, jako jsou Arbitrum a Optimism, byla vyvinuta s cílem snížit náklady na plyn tím, že zpracovávají transakce mimo hlavní řetězec Ethereum.
Jedinečný identifikátor přiřazený každé transakci v blockchainu. Funguje jako stvrzenka, kterou lze použít ke sledování stavu transakce.
Hash transakce je dlouhý řetězec písmen a čísel, který se generuje při vysílání transakce do sítě. Můžete jej vložit do průzkumníka bloků a zobrazit podrobnosti transakce: odesílatele, příjemce, částku, poplatek a stav potvrzení.
Nástroj, který umožňuje vyhledávat a procházet data blockchainu - transakce, adresy, bloky a další.
Mezi oblíbené průzkumníky bloků patří Etherscan pro Ethereum, Blockchain.com pro Bitcoin a Solscan pro Solana. Fungují jako vyhledávač dat v blockchainu, umožňují ověřovat transakce, kontrolovat zůstatky v peněženkách a zkoumat aktivitu chytrých smluv.
Metoda, kterou se síť blockchain shoduje na aktuálním stavu hlavní knihy a ověřuje nové transakce.
Dva nejběžnější mechanismy jsou Proof of Work (používaný Bitcoin) a Proof of Stake (používaný Ethereum, Solana, Cardano). Každý z nich má jiné kompromisy z hlediska bezpečnosti, rychlosti, spotřeby energie a decentralizace.
Změna protokolu blockchainu. Soft fork je zpětně kompatibilní, hard fork vytváří nový řetězec, který není kompatibilní se starým.
Bitcoin Cash vznikl v roce 2017 hard forkem Bitcoin - neshody ohledně velikosti bloku vedly ke vzniku dvou samostatných řetězců. Ethereum prošel v roce 2022 velkým hard forkem nazvaným "The Merge", při kterém došlo k přechodu z Proof of Work na Proof of Stake.
Primární, živá blockchainová síť, kde probíhají skutečné transakce se skutečnou hodnotou.
Před spuštěním v mainnetu se projekty obvykle testují v testnetu, kde token nemají žádnou skutečnou hodnotu. Když je projekt "spuštěn v mainnetu", znamená to, že skutečná verze je živá a funkční.
Samostatná blockchainová síť sloužící k testování a vývoji, kde token nemají žádnou skutečnou peněžní hodnotu.
Vývojáři používají testnety k testování chytrých smluv, změn protokolu a aplikací před jejich nasazením do mainnetu. Uživatelé mohou získat bezplatné testnety token z "kohoutků" a experimentovat, aniž by riskovali skutečné peníze.
Základní blockchainová síť - hlavní řetězec, který zpracovává a dokončuje transakce. Příklady zahrnují Bitcoin, Ethereum a Solana.
Blockchainy vrstvy 1 zajišťují základní zabezpečení a konsensus sítě. S rostoucím využitím mohou čelit problémům se škálovatelností - proto byla vyvinuta řešení na 2. vrstvě, která zvládnou více než flow.
Sekundární protokol postavený nad blockchainem 1. vrstvy s cílem zlepšit jeho škálovatelnost a rychlost a zároveň zdědit jeho bezpečnost.
Příkladem jsou Arbitrum a Optimism (postavené na Ethereum) a Lightning Network (postavené na Bitcoin). Vrstvy 2 zpracovávají transakce mimo hlavní řetězec a pravidelně je vypořádávají zpět do vrstvy 1, čímž snižují poplatky a zvyšují propustnost.
Schopnost různých blockchainových sítí vzájemně komunikovat a sdílet data nebo aktiva.
Mosty mezi řetězci umožňují interoperabilitu tím, že umožňují token pohybovat se mezi různými blockchainy. Projekty jako Polkadot a Cosmos jsou speciálně navrženy tak, aby interoperabilitu usnadňovaly.
Služba, která poskytuje reálná data chytrým smlouvám na blockchainu. Blockchain nemohou samy přistupovat k externím datům.
Chainlink je nejpoužívanější oracle síť, která poskytuje cenové kanály, údaje o počasí, sportovní výsledky a další externí informace pro chytré smlouvy. Bez oraklů by DeFi nebyla možná.
Vlastnost, že jakmile jsou data jednou zaznamenána v blockchainu, nelze je změnit ani smazat.
Nezměnitelnost je jednou z hlavních hodnot blockchainu - vytváří záznam všech transakcí, který je odolný proti manipulaci. Znamená to však také, že chyby (například odeslání kryptoměny na špatnou adresu) nelze zvrátit.
Online platforma, kde můžete nakupovat, prodávat a obchodovat s kryptoměnami za fiat měnu nebo jiná digitální aktiva.
Burzy mohou být centralizované (jako Binance a Coinbase, kde společnost drží vaše aktiva v úschově) nebo decentralizované (jako Uniswap, kde obchodujete přímo ze své peněženky). Výběr burzy ovlivňuje vaše poplatky, bezpečnost, dostupné mince a uživatelský komfort.
Příkaz k okamžitému nákupu nebo prodeji kryptoměny za nejlepší dostupnou aktuální cenu.
Tržní příkazy se provádějí okamžitě, ale nemáte kontrolu nad přesnou cenou - dostanete to, co trh v danou chvíli nabízí. U vysoce likvidních párů, jako je BTC/USDT, je skluz obvykle zanedbatelný. U párů s nízkou likviditou může být slippage značný.
Příkaz k nákupu nebo prodeji kryptoměny za určitou nebo lepší cenu. Provede se, až když trh dosáhne vaší cílové ceny.
Limitní příkazy vám dávají větší kontrolu nad vstupní cenou, ale nemusí se nikdy realizovat, pokud trh nedosáhne vašeho cíle. Obvykle mají nižší poplatky než tržní příkazy (poplatky tvůrce oproti poplatkům takera). Naučit se používat limitní příkazy je jedním z nejjednodušších způsobů, jak snížit náklady na obchodování.
Makers add liquidity to the order book (limit orders); takers remove liquidity (market orders). Maker fees are typically lower.
When you place a limit order that doesn't execute immediately, you're a maker — adding an order to the book for others to fill. When you place a market order that executes instantly, you're a taker — taking an existing order from the book.
The difference between the highest price a buyer is willing to pay (bid) and the lowest price a seller is willing to accept (ask).
A tighter spread means higher liquidity and lower trading costs. Major pairs like BTC/USDT on large exchanges have very tight spreads. Less liquid pairs or smaller exchanges may have wider spreads, effectively increasing your cost.
How easily an asset can be bought or sold without significantly affecting its price. High liquidity means large trades can be executed with minimal price impact.
Bitcoin and Ethereum have the highest liquidity in crypto — you can buy or sell millions of dollars worth without moving the price much. Small-cap altcoins often have low liquidity, meaning even modest trades can cause large price swings.
A real-time list of all open buy and sell orders for a particular trading pair on an exchange, organized by price.
The order book shows market depth — how many orders exist at each price level. A deep order book indicates high liquidity. Traders use order books to gauge supply and demand and identify support and resistance levels.
Two assets that can be traded against each other on an exchange, such as BTC/USDT or ETH/BTC.
The first asset in the pair (base currency) is what you're buying or selling. The second (quote currency) is what you're paying with or receiving. Not all exchanges support all trading pairs.
Identity verification required by most regulated exchanges before you can trade. Typically involves uploading a government-issued ID.
KYC is a regulatory requirement designed to prevent money laundering, fraud, and terrorist financing. Most reputable exchanges require it before you can deposit fiat currency or withdraw funds.
Laws and regulations designed to prevent the conversion of illegally obtained money into legitimate assets. Exchanges must comply with AML requirements.
AML regulations require exchanges to monitor transactions for suspicious activity, report large or unusual transfers, and maintain records. These regulations vary by jurisdiction but are increasingly standardized globally.
The difference between the expected price of a trade and the actual price at which it executes.
Slippage occurs most often with market orders on low-liquidity pairs. Setting a slippage tolerance (common in DEX trading) limits how much price movement you'll accept before the trade fails.
The total amount of a cryptocurrency traded within a specific time period, usually measured in 24 hours.
High volume indicates active trading interest and typically correlates with higher liquidity and tighter spreads. Volume spikes often accompany significant price movements.
The total value of a cryptocurrency, calculated by multiplying the current price by the total circulating supply.
Market cap is the most common way to rank cryptocurrencies by size. It is categorized as large-cap (>$10B), mid-cap ($1-10B), and small-cap (<$1B). Smaller market caps generally mean higher volatility and risk.
The highest price a cryptocurrency has ever reached.
ATH is often used as a psychological reference point. Many altcoins from previous bull markets have never recovered to their ATH — a reminder that past highs are not guaranteed to be revisited.
A prolonged period of declining prices, typically defined as a 20%+ decline from recent highs.
The most recent crypto bear market ran from late 2021 through 2022, with Bitcoin falling from ~$69,000 to ~$16,000. Bear markets can last months or years and are a normal part of market cycles.
A prolonged period of rising prices, characterized by optimism, investor confidence, and increasing demand.
Crypto bull markets have historically been triggered by Bitcoin halving events, which occur roughly every four years. Bull markets often end with a period of euphoria and overvaluation before correcting.
The degree to which a cryptocurrency's price fluctuates over time. High volatility means large price swings in short periods.
Bitcoin regularly experiences 5-10% daily moves, and altcoins can move 20-50% in a single day. This volatility creates both opportunity and risk.
Fear Of Missing Out — the anxiety that others are profiting from an opportunity you're not participating in, leading to impulsive buying.
FOMO is one of the biggest drivers of poor investment decisions in crypto. It typically peaks near the top of a rally. The antidote is having a pre-defined investment plan.
Fear, Uncertainty, and Doubt — negative information spread to cause fear and drive prices down, sometimes deliberately.
FUD can be legitimate concerns or manufactured misinformation. Learning to distinguish between genuine risk and manufactured FUD is a critical skill for crypto investors.
An investment strategy where you invest a fixed amount at regular intervals regardless of price, reducing the impact of volatility.
Instead of trying to time the market, DCA investors buy a fixed amount whether the price is high or low. Over time, this smooths out your average entry price. It's widely considered the most sensible approach for most investors.
Financial services built on blockchain technology that operate without traditional intermediaries like banks or brokerages.
DeFi enables lending, borrowing, trading, insurance, and yield generation through smart contracts rather than centralized institutions. Key DeFi platforms include Aave (lending), Uniswap (trading), and MakerDAO (stablecoin generation).
A cryptocurrency exchange that operates without a central authority, allowing peer-to-peer trading directly from user wallets.
Unlike centralized exchanges, DEXs like Uniswap never hold custody of your funds. You connect your wallet, approve the trade, and the smart contract executes the swap. DEXs offer more privacy and token variety but typically have less liquidity.
A collection of funds locked in a smart contract that provides liquidity for trading on a decentralized exchange.
Instead of an order book, DEXs use liquidity pools where users deposit pairs of tokens. Traders swap against the pool, and the price adjusts algorithmically. Liquidity providers earn a share of trading fees as a reward.
The practice of moving crypto assets between different DeFi protocols to maximize returns from lending, staking, and liquidity provision.
Yield farmers chase the highest APY across multiple platforms. While potentially lucrative, yield farming carries significant risks: smart contract bugs, impermanent loss, and token devaluation.
The temporary loss experienced by liquidity providers when the price ratio of their deposited tokens changes compared to simply holding them.
If you deposit ETH and USDC into a pool and ETH doubles, you'd have been better off just holding. The "loss" is impermanent because it reverses if prices return to the original ratio. If you withdraw while the ratio has changed, it becomes permanent.
The total amount of crypto assets deposited in a DeFi protocol, used as a measure of the protocol's size and adoption.
TVL is the most common metric for comparing DeFi protocols. A higher TVL generally indicates more trust and usage. DeFiLlama is the most widely used tool for tracking TVL.
APR (Annual Percentage Rate) is the simple interest rate. APY (Annual Percentage Yield) includes compound interest, making it always higher.
A 10% APR means you earn 10% per year. APY includes compounding, so it's slightly more. In DeFi, advertised rates can fluctuate dramatically — a 100% APY today may drop to 10% next week.
An uncollateralized loan that must be borrowed and repaid within a single blockchain transaction. If not repaid, the entire transaction reverts.
Flash loans are unique to DeFi. They're used for arbitrage, collateral swaps, and liquidations — but also exploited in attacks where millions are borrowed, used to manipulate prices, and repaid in one transaction.
An organization governed by smart contracts and token-holder voting rather than a traditional management structure.
DAO members vote on proposals using governance tokens. Major DAOs include MakerDAO, Uniswap DAO, and Aave DAO. While theoretically democratic, DAOs face challenges with voter participation and large holders dominating votes.
A cryptocurrency that gives holders voting rights on the development and management decisions of a DeFi protocol.
Examples include UNI (Uniswap), AAVE (Aave), and MKR (Maker). Governance tokens let holders vote on fee changes, protocol upgrades, and treasury spending.
A DeFi platform that allows users to lend their crypto and earn interest, or borrow against their holdings.
Aave and Compound are the largest. Lenders earn variable interest. Borrowers must over-collateralize (typically 150%+) and face liquidation if collateral value drops.
An algorithm that automatically sets prices and facilitates trades in a liquidity pool, replacing the traditional order book model.
AMMs use mathematical formulas (most commonly x*y=k) to determine prices based on the ratio of assets in the pool. When you trade on Uniswap, you're trading against an AMM, not another person.
A token on one blockchain that represents an asset from another blockchain. WBTC is Bitcoin wrapped for use on Ethereum.
Wrapping allows assets to be used across different ecosystems. The wrapped token is backed 1:1 by the underlying asset, held in custody by a custodian or smart contract.
A protocol that enables the transfer of tokens or data between two different blockchain networks.
Bridges are essential for cross-chain interoperability. However, they have been a major target for hackers, with billions lost. Always use well-established bridges and be cautious about the amount transferred.
Assets pledged as security for a loan. In DeFi, loans typically require over-collateralization — depositing more value than you borrow.
To borrow $1,000 in USDC, you might need $1,500 in ETH as collateral. If ETH drops enough, your position is liquidated.
The automatic selling of a borrower's collateral when its value falls below the minimum required ratio.
During sharp drops, mass liquidations can cascade — falling prices trigger liquidations, creating more selling pressure, triggering more liquidations.
A penalty in Proof of Stake networks where validators lose staked tokens for malicious behavior or negligence.
If a validator attacks the network, goes offline, or validates conflicting blocks, their stake is destroyed. This makes PoS secure — validators have real money at risk.
The ability of DeFi protocols to interact with and build upon each other, often described as "money legos."
You can deposit ETH into Aave, receive aETH, use that as collateral elsewhere — stacking protocols on top of each other. This enables complex strategies but creates systemic risk if one protocol fails.
A secret cryptographic code that gives you control over your cryptocurrency. Whoever has the private key can move the funds.
Your private key is the master password to your crypto assets. Unlike a bank password, it cannot be reset. Private keys should never be shared, stored digitally in unencrypted form, or entered on websites.
A cryptographic code derived from your private key that serves as your address for receiving cryptocurrency. Safe to share.
Think of your public key as your bank account number — give it to people who want to send you money. Your private key is the PIN — never share it. Public keys are derived from private keys through a one-way mathematical function.
A set of 12 or 24 words that can restore your entire crypto wallet if you lose access to your device.
When you create a wallet, it generates a seed phrase you must write down and store securely — on paper or metal, never digitally. Anyone with your seed phrase can restore your wallet on any device. No legitimate service will ever ask for it.
An extra security layer requiring a second verification code (usually from an app like Google Authenticator) in addition to your password.
2FA is non-negotiable for exchange accounts. Even if someone steals your password, they can't access your account without the 2FA code. Use an authenticator app — not SMS, which is vulnerable to SIM swaps.
A scam where attackers create fake websites, emails, or messages mimicking legitimate services to steal your credentials or seed phrase.
Phishing is the most common attack in crypto. Scammers create pixel-perfect copies of exchange login pages. Never click links in emails — always navigate directly to the official website.
A scam where project creators suddenly abandon it and drain the funds, leaving investors with worthless tokens.
Most common with new, unaudited tokens on DEXs. Warning signs: anonymous teams, unrealistic returns, aggressive marketing with no working product.
A smart contract designed to look legitimate but coded so you can buy tokens but cannot sell them — your funds are trapped.
The sell function is secretly disabled. The price appears to rise (because people can buy but not sell), attracting more victims. Token Sniffer can help detect honeypots.
An attack where a hacker convinces your phone carrier to transfer your number to their device, intercepting SMS-based 2FA codes.
Once the attacker has your number, they can reset passwords and bypass 2FA on exchanges. Defense: use an authenticator app (not SMS) and set a carrier PIN.
Storing cryptocurrency offline — on a hardware wallet or paper wallet — disconnected from the internet to protect against hacking.
Cold storage is the most secure way to hold cryptocurrency long-term. Hardware wallets like Ledger and Trezor store keys on a dedicated device that never connects to the internet directly.
A cryptocurrency wallet connected to the internet. Convenient but more vulnerable to hacking.
Hot wallets include MetaMask, Trust Wallet, and exchange account balances. Good for daily transactions, not for large long-term holdings. Think: pocket cash vs. savings account.
A wallet requiring multiple private keys to authorize a transaction, adding an extra layer of security.
A 2-of-3 multisig requires any 2 out of 3 key holders to sign. Protects against a single point of failure. Used by DAOs, exchanges, and institutions.
A professional security review of a smart contract's code to identify vulnerabilities before deployment.
Reputable projects have audits by firms like CertiK, Trail of Bits, or OpenZeppelin. An audit doesn't guarantee safety but significantly reduces risk. Always check audit status before depositing funds.
An audit showing that an exchange holds enough assets to cover all customer deposits.
After FTX's collapse revealed insolvency, proof of reserves became standard. Binance, Kraken, Bybit publish regular reports. While not a complete guarantee, it's a significant transparency improvement.
A scam where attackers send tiny transactions from an address similar to one you've used, hoping you'll copy the wrong address.
Scammers generate addresses sharing the same first and last characters as your legitimate contacts. Always verify the full address before sending.
An attack where tiny amounts of crypto are sent to wallets to track and de-anonymize the owners.
The attacker sends trace amounts to thousands of wallets, then monitors how those amounts are combined with other funds to link addresses to identities. Don't interact with unexpected tiny deposits.
Software or hardware that stores your private keys and allows you to send, receive, and manage your cryptocurrency.
Wallets don't "hold" crypto — assets live on the blockchain. The wallet holds your private keys which prove ownership. Wallets come as mobile apps, browser extensions, hardware devices, and paper backups.
A physical device that stores your private keys offline, providing the highest level of security.
Popular options: Ledger (Nano S Plus, Nano X) and Trezor (Model One, Model T). They sign transactions offline — keys never leave the device. Cost $50-$200, recommended for significant holdings.
A wallet that exists as an application on your phone, computer, or browser. More convenient but connected to the internet.
MetaMask, Trust Wallet, and Phantom are popular software wallets. Free and essential for DeFi and dApps. The tradeoff: only as secure as the device they're on.
A wallet where a third party (like an exchange) holds your private keys on your behalf.
When you keep crypto on Coinbase or Binance, you're using a custodial wallet. Convenient (password recovery possible) but means you trust the exchange. "Not your keys, not your coins."
A wallet where you alone control the private keys. No third party can access, freeze, or move your funds.
MetaMask, Ledger, Trust Wallet are non-custodial. You bear full responsibility — lose your seed phrase, nobody can recover your funds. More secure but more personal responsibility.
Holding your own private keys rather than trusting an exchange or third party.
Self-custody became a major topic after FTX showed the risks of trusting exchanges. The benefits: full control, censorship resistance. The risks: you alone are responsible.
A unique string of characters that serves as the destination for cryptocurrency transfers.
Addresses look different by chain: Bitcoin starts with 1, 3, or bc1; Ethereum starts with 0x. Always double-check before sending — transactions are irreversible.
An optional additional word added to your seed phrase for extra security, creating a hidden wallet within your wallet.
A 25th word creates entirely separate addresses from your base seed phrase. Even if someone finds your 24 words, they can't access the hidden wallet. Warning: forget the passphrase, those funds are gone forever.
A wallet supporting multiple blockchain networks from a single interface.
Trust Wallet and MetaMask (with manual network additions) support multiple chains — hold ETH, BNB, AVAX all in one app.
A naming system replacing long Ethereum addresses (0x7A3b...) with human-readable names like "yourname.eth."
ENS works like DNS for the internet. Names are NFTs on Ethereum and can point to wallets, websites, and social profiles. They've become a form of digital identity.
Using computer power to validate transactions and add new blocks to a Proof of Work blockchain, earning crypto rewards.
Bitcoin miners compete to solve complex puzzles. The winner adds the next block and earns the block reward (currently 3.125 BTC) plus transaction fees. Requires specialized hardware (ASICs) and significant electricity.
A consensus mechanism where miners compete to solve mathematical puzzles, with the winner earning the right to add the next block.
Bitcoin uses PoW — the oldest and most battle-tested mechanism. It provides strong security but consumes significant energy. Ethereum transitioned from PoW to PoS in 2022, cutting energy use ~99.95%.
A consensus mechanism where validators are selected based on the cryptocurrency they have "staked" (locked up) as collateral.
Instead of competing with computation, validators put up tokens as a security deposit. Honest behavior earns rewards; cheating causes their stake to be slashed. Used by Ethereum, Solana, Cardano, and most modern chains.
Locking up cryptocurrency to support a Proof of Stake blockchain, earning rewards in return.
When you stake ETH, SOL, ADA, you help secure the network. Rewards are typically 3-10% annually. Staking can be done directly (running a validator) or through exchanges and services.
A node operator in PoS who validates transactions and proposes new blocks in exchange for staking rewards.
Ethereum validators need 32 ETH staked. They're randomly selected to propose blocks. Malicious behavior or extended downtime results in slashing.
A pre-programmed event where Bitcoin's block reward is cut in half, occurring approximately every four years.
The most recent halving (April 2024) reduced the reward from 6.25 to 3.125 BTC. Halvings increase scarcity. Historically, major price increases have followed within 12-18 months.
The total computational power being used to mine and process transactions on a Proof of Work blockchain.
Measured in hashes per second. Higher hash rate = more security. Bitcoin's hash rate has consistently increased, reaching record highs regularly.
An automatic change to mining difficulty that keeps block creation time consistent regardless of how many miners join or leave.
Bitcoin adjusts every 2,016 blocks (~2 weeks). More miners = harder puzzles. Fewer miners = easier. This ensures ~10 minute blocks.
A PoS variation where token holders vote to elect a fixed number of validators who produce blocks on their behalf.
Used by EOS and Tron. Faster and more efficient but sacrifices some decentralization — typically only 21-100 elected delegates.
The point at which a transaction is considered irreversible and permanently recorded.
Bitcoin: ~6 confirmations (~60 min). Ethereum: ~13 min (2 epochs). Solana: near-instant. Faster finality is better for UX but involves different security tradeoffs.
The cryptocurrency paid to a miner or validator for successfully adding a new block to the blockchain.
Bitcoin's reward started at 50 BTC, now 3.125 BTC after 4 halvings. On Ethereum, validators earn from newly minted ETH plus transaction fees.
A theoretical attack where a single entity gains >50% of mining power or staked tokens, allowing them to manipulate the ledger.
With majority control, an attacker could double-spend coins or reverse transactions. For Bitcoin, this would cost billions — making it economically impractical.
A unique digital token on a blockchain representing ownership of a specific item — artwork, music, in-game assets, or other content.
Unlike Bitcoin where each unit is identical, each NFT is unique. NFTs exploded in 2021 with art sales reaching millions. Applications extend to gaming, real estate, ticketing, and identity.
An asset where each unit is identical and interchangeable. One Bitcoin equals any other Bitcoin.
Fungibility is essential for a currency. Bitcoin and most cryptocurrencies are fungible. NFTs are non-fungible — each is unique.
A digital asset created on an existing blockchain rather than having its own. Most DeFi and utility assets are tokens.
Tokens use standards like ERC-20 (Ethereum) or SPL (Solana). The distinction between "coin" (own blockchain) and "token" (built on another) is technical but often used interchangeably.
The standard for creating fungible tokens on Ethereum. USDT, USDC, LINK, UNI, and thousands more follow this standard.
ERC-20 defines rules all Ethereum tokens must follow, ensuring compatibility with any wallet, exchange, or app that supports the standard.
Any cryptocurrency other than Bitcoin. The term combines "alternative" and "coin."
Ethereum, Solana, Cardano are all technically altcoins. Typically refers to smaller-cap coins. Altcoins have higher volatility and risk but also higher potential upside.
A cryptocurrency inspired by internet memes, typically with no underlying technology beyond community enthusiasm.
Dogecoin and Shiba Inu are the most well-known. They experience extreme volatility driven by social media. The vast majority go to zero.
A token that provides access to a specific product, service, or feature within a blockchain ecosystem.
BNB provides Binance fee discounts. LINK pays Chainlink oracles. FIL pays for Filecoin storage. Value derives from actual usage.
A digital token representing ownership in a real-world asset like equity or real estate, subject to securities regulations.
Regulated financial instruments that must comply with securities laws. Could make stocks, bonds, and real estate more accessible and tradable 24/7.
Permanently removing tokens from circulation by sending them to an inaccessible address, reducing total supply.
Burns create deflationary pressure. Ethereum burns a portion of transaction fees (EIP-1559). Binance periodically burns BNB.
Free distribution of tokens to wallet addresses, typically as marketing or a reward for early users.
Uniswap's 2020 airdrop gave 400 UNI to anyone who had used the protocol. Airdrops incentivize early adoption. Be cautious of unsolicited airdrops — some are phishing vectors.
The economic model of a cryptocurrency — supply, distribution, inflation/deflation, utility, and incentives.
Key factors: total supply (capped like BTC at 21M, or inflationary?), distribution (how much do founders hold?), vesting schedules, and utility.
A schedule that gradually releases tokens to team members and investors over time rather than all at once.
Prevents insiders from dumping immediately. Typical: 1-year cliff, then monthly releases over 2-3 years. Token unlocks can create selling pressure.
A detailed technical document explaining a crypto project's technology, use case, tokenomics, and roadmap.
Bitcoin's whitepaper by Satoshi Nakamoto (2008) is the most famous. Reading the whitepaper is essential research before investing. Projects without one should be viewed skeptically.
A cryptocurrency designed to maintain a stable value, typically pegged 1:1 to the US dollar.
Three types: fiat-backed (USDT, USDC), crypto-backed (DAI), and algorithmic (risky — see TerraUSD). Stablecoins solve volatility for payments and trading.
The largest stablecoin by market cap, issued by Tether Limited and pegged to the US dollar.
More traded by volume than Bitcoin. Available on virtually every exchange. Tether has faced scrutiny about reserve backing.
A regulated stablecoin issued by Circle, backed by cash and short-term US Treasury bonds.
More transparent than USDT — Circle publishes regular attestation reports. Preferred by institutions and regulatory-conscious users.
A decentralized stablecoin created by MakerDAO, backed by over-collateralized crypto assets.
Unlike corporate-issued stablecoins, DAI is generated through smart contracts. Users deposit collateral worth 150%+ of the DAI they mint.
When a stablecoin loses its peg and trades significantly above or below $1.00.
The most catastrophic depeg was TerraUSD in May 2022 — from $1.00 to ~$0, wiping out ~$40 billion. Even major stablecoins have briefly depegged.
A stablecoin that maintains its peg through automated supply adjustments rather than holding reserves.
Elegant in theory but catastrophic in practice — TerraUSD's death spiral destroyed $40 billion. Most investors now view them with extreme skepticism.
A stablecoin backed by actual fiat currency, cash deposits, or cash-equivalent reserves like government bonds.
USDT and USDC are fiat-backed. Trust depends on reserve quality and transparency. The key question: if everyone redeemed at once, are reserves actually there?
A digital currency issued directly by a country's central bank — a digital form of national currency.
Not cryptocurrencies — centralized, government-controlled. China's digital yuan is most advanced. Offers payment efficiency but raises major privacy concerns.
The US federal agency regulating securities markets, which has increasingly asserted jurisdiction over cryptocurrency.
The SEC approved spot Bitcoin ETFs (Jan 2024) and Ethereum ETFs — landmark decisions. It has also sued multiple crypto projects, arguing many tokens are securities.
The SEC's test for whether something is a security: (1) investment of money, (2) common enterprise, (3) expectation of profits, (4) from others' efforts.
Many token sales arguably meet all four criteria. Whether specific tokens are securities remains actively debated in courts.
An investment fund traded on stock exchanges. Spot Bitcoin and Ethereum ETFs allow traditional investors to gain crypto exposure.
SEC approved spot Bitcoin ETFs in January 2024. BlackRock and Fidelity launched the largest ones. ~$110 billion flowed in during the first year.
The EU's comprehensive regulatory framework for crypto assets — the first of its kind globally.
Establishes rules for service providers, stablecoin issuers, exchange licensing, and consumer protection. Took effect through 2024-2025.
Government restrictions prohibiting certain countries, entities, or individuals from accessing financial services including crypto.
Major exchanges comply with international sanctions. Tornado Cash, a privacy protocol, was sanctioned by the US Treasury in 2022.
An action triggering a tax obligation. Selling crypto, trading one for another, and earning yield are typically taxable.
Simply buying and holding is not taxable in most jurisdictions. Tax rules vary by country. Keep detailed records of all transactions.
Tax on profit from selling an asset for more than you paid. Crypto profits are subject to capital gains tax in most countries.
Short-term gains (held <1 year) taxed at higher rates. Some countries (Germany) exempt gains held >1 year. Consult a tax professional.
A regulation requiring exchanges to share sender and recipient information for transactions above certain thresholds.
Extended to crypto by FATF in 2019. Requires identifying info for transfers above $1,000 in many jurisdictions.
The evolving legal framework around decentralized finance protocols that operate without central operators.
Regulating DeFi is uniquely challenging: no company to regulate, no central control, and protocols can be deployed anonymously.
An industry body creating and enforcing standards for its members without direct government mandate.
Proposed as an alternative to heavy government regulation. Exchanges would self-regulate through agreed-upon standards.
The mathematical science of encoding information that underpins all cryptocurrency — securing transactions, generating keys, and creating signatures.
Blockchain uses hash functions (SHA-256), public-key cryptography, and Merkle trees. You don't need to understand the math, but knowing cryptography is the foundation is important.
A mathematical function converting any input into a fixed-length string. Same input always produces same output, but output cannot reveal input.
Bitcoin uses SHA-256; Ethereum uses Keccak-256. Used to link blocks, create addresses, and verify data. Mining is essentially searching for a hash meeting specific criteria.
A data structure allowing efficient verification of large datasets by organizing hashes in a tree hierarchy.
You can prove a transaction is included in a block without downloading all transactions. Essential for light clients like mobile wallets.
A cryptographic method allowing one party to prove knowledge of something without revealing the information itself.
ZKPs enable both privacy and scalability. ZK-rollups process transactions off-chain and submit validity proofs to the main chain.
A Layer 2 scaling solution processing transactions off the main chain and posting compressed data back to Layer 1.
Optimistic rollups (Arbitrum, Optimism) assume transactions are valid unless challenged. ZK-rollups (zkSync) generate cryptographic proofs. Both dramatically reduce costs.
A scaling technique splitting a blockchain into parallel chains (shards), each processing a portion of transactions.
Allows processing many transactions simultaneously. Ethereum's roadmap includes danksharding optimized for rollup data availability.
The guarantee that data needed to verify a block is accessible to network participants.
Critical for rollup security. Projects like Celestia specialize in providing data availability as a service.
Blockchain networks incentivizing the creation of real-world physical infrastructure through token rewards.
Filecoin for storage, Helium for wireless, Render for GPU computing, Hivemapper for mapping. Uses crypto economics to crowdsource infrastructure.
The maximum profit a block producer can extract by reordering, including, or excluding transactions within a block.
Sometimes called an "invisible tax." Validators can front-run trades, sandwich attack users, or arbitrage between DEXs. MEV-protection tools like Flashbots help.
A protocol allowing applications to communicate with blockchain nodes to submit transactions and query data.
MetaMask connects through an RPC provider (Infura, Alchemy). If the provider goes down, wallets and dApps stop working.
An attack where a single entity creates many fake identities to gain disproportionate influence.
Can target airdrops, governance votes, or consensus. PoW and PoS resist this because participation requires real resources.
A fixed time period used by blockchains to organize validator rotations, reward distributions, and consensus rounds.
On Ethereum, an epoch = 32 slots (~6.4 minutes). Finality is achieved after 2 epochs (~13 minutes). Helps organize PoS coordination.
A misspelling of "hold" that became crypto slang for holding long-term regardless of price drops.
From a 2013 Bitcoin forum post: "I AM HODLING." Reflects the strategy of refusing to sell during bear markets, believing long-term holding outperforms trading.
We're All Gonna Make It — an optimistic rallying cry expressing belief in eventual success.
Popular during the 2021 bull market. Its counterpart NGMI (Not Gonna Make It) is used to mock poor decisions.
An individual or entity holding a very large amount of cryptocurrency — enough to significantly impact market price.
Bitcoin whales (1,000+ BTC) are tracked by analytics firms. Movements to exchanges may signal selling; movements off suggest holding.
Slang for holding through extreme volatility without selling.
The opposite is "paper hands" (selling at first drop). While conviction can be profitable, it can also mean holding a losing position too long.
Slang for selling quickly when the price drops, typically out of fear.
Viewed negatively in crypto culture, but there are legitimate reasons to sell — cutting losses, rebalancing, or following a plan.
Crypto slang for "wrecked" — losing a significant amount of money through bad trades, hacks, or scams.
Can happen through leverage, rug pulls, wrong addresses, or buying tops. Used both sympathetically and mockingly.
Investing heavily in a token impulsively, without proper research — driven by hype or FOMO.
Occasionally works spectacularly (early DOGE buyers) but far more often results in losses. The community simultaneously celebrates and warns against it.
A daily greeting used across crypto communities. More than a greeting — it signals active community participation.
Emerged from NFT and DeFi communities in 2021. Some projects reward consistent engagement.
A disclaimer added when sharing investment opinions, indicating it should not be treated as professional guidance.
Used both sincerely and ironically. Does not actually provide legal protection in most jurisdictions.
A reminder to investigate any crypto project yourself rather than relying on others' opinions.
Research should include: whitepaper, team, tokenomics, audits, community, and competitive landscape. Effort in research correlates directly with investment quality.
Short for "degenerate" — high-risk, speculative behavior in crypto, used with self-aware humor.
Chasing high-APY farms, aping into meme coins, trading with excessive leverage. Used with pride in some circles and as a warning in others.
Aggressively promoting a cryptocurrency, often for personal gain. A "shill" promotes tokens they hold.
Pervasive in crypto social media. Always ask: does this person hold what they're recommending? Were they paid to promote it?
