A for Airdrop, B for Bitcoin..
a guide to crypto lingo
Hello friends! 🙋♂️
Wanted to do this short write-up on common terminologies and slang used in the crypto-verse to get y’all up to speed. You will come across these terms very often and it would suck to google them each time so wanted to compile the most common ones here. Written for complete beginners as well. Let’s go!
Alpha - A key piece of information, if acted upon, could lead to outsized gains on an investment.
Airdrop - Distribution of a coin/token for free to selected users.
APR - Annual Percentage Return. It’s the rate for lending/borrowing that’s calculated annually. Does not include compounding. 120% APR means 10% interest per month.
APY - Annual Percentage Yield. This is the compounded rate of return. For example - 10% interest would compound each month over the next 12 months.
Bull run/market - The positive trajectory of the entire market, i.e., price increase, leading to positive gains on investments made.
Bear market - Opposite of bull market, i.e., prices tank across the board leading to significant losses.
Burn - Akin to burning money. When crypto is sent to a dead/unusable account, the said amount is said to have been burned thereby reducing the supply of that coin.
Blockchain - A distributed ledger that stores all your transactions. Cryptographically secure blockchains are immutable, permissionless, and trustless.
CEX - Stands for ‘Centralized Exchange’. A marketplace, primarily for buying and selling coins. Examples - Binance, Coinbase, WazirX, Coinswitch, etc.
Coin - The native currency of a blockchain. Example - $ETH (currency) on Ethereum (blockchain), $MATIC on Polygon, etc.
Decentralization - Distribution of power whereby no single entity possesses greater than 51% control on the blockchain. A key parameter to ensure censorship resistance.
Dump - Not the one living beings take. This refers to the massive selling of a coin within a short period of time. Often done when people believe the price is going to tank.
DeFi - Stands for ‘Decentralized Finance’. Totally permissionless and censorship-resistant financial applications for lending, borrowing, buying, selling, insurance, etc. The stock market for example is traditional finance (TradFi) with regulators involved.
DEX - Stands for ‘Decentralized Exchange’. A marketplace, primarily for buying and selling coins. Example - Uniswap.
dApp - An app built on top of a decentralized blockchain. Example - Aave.
DAO - Stands for Decentralized Autonomous Organization. The laws are written in code and the community leads the organization in most cases.
Diamond Handed - A person who has extreme conviction in a coin/token and doesn’t sell even when the price crashes.
Fork - Splitting up of a blockchain to go another way. Example - Ethereum Classic is a fork of Ethereum. It’s like breaking up and moving on to live 2 separate lives.
Flippening - A coin overtaking another in terms of total market cap is termed flippening.
FUD - ‘Fear, Uncertainty, Doubt’. One of the common reasons attributed to a market-wide price crash. Usually based on macro events like China banning crypto, etc.
Gas - The fee you pay for making a txn on the Ethereum chain. The amount is dependent on network congestion and the nature of the txn you’re making. Needless to say, Digene cannot solve this.
HFSP - ‘Have Fun Staying Poor’. A comment passed playfully to discourage the selling of crypto or to prevent someone from making poor investment choices.
HODL - Refers to HOLDing a crypto asset and not selling it even in dire circumstances. Backstory: A drunk trader back in the day wrote ‘HODL’ instead of ‘HOLD’ on a Reddit thread while ranting on how bad of a trader he was. Folks memed it to reality 😂.
Mint - The process of creating a new token.
NGMI - Stands for ‘Not Gonna Make It’. Again, a playful jibe made on folks with fickle minds (subjective), noobs, and poor investment choices (subjective) 😂.
NFT - Non-Fungible-Token. Any token that is unique and not interchangeable like your identity card, resume, art piece, etc. Fungible is replicable and interchangeable like currencies (INR, ETH, BTC, USD).
NFA - Not Financial Advice.
Paper Handed - A person who sells his tokens at the sign of a market crash.
Rug Pull - A scam where builders/founders/developers run away with users’ money.
Smart Contract - A piece of code that lives on the blockchain and executes terms when called/invoked.
Staking - A fancy term for depositing your coins/tokens to a protocol in order to earn rewards. Much like Fixed Deposits.
TPS - Transactions per second. Important because some blockchains claim to have a high TPS which gives them an edge over others (subjective). Example - Solana has a high TPS compared to Ethereum.
WAGMI - ‘We Are Gonna Make It’. A positive-sum slang used among optimists.
These are good enough to get you off the ground. If you have a friend who wants to get started but doesn’t know where to go, share this with them otherwise they NGMI.
Fire