99 Important Crypto and Blockchain Terms You Need to Know!

“To facilitate easier understanding and research of various projects, Tonraffles has compiled a list of important and commonly used Blockchain terms in the crypto market for reference.”

1. Blockchain: A distributed ledger technology that records transactions across many computers so that the record cannot be altered retroactively.
2. Cryptocurrency: A digital or virtual currency that uses cryptography for security and operates independently of a central bank.
3. Bitcoin (BTC): The first and most well-known cryptocurrency, created by an unknown person or group of people under the name Satoshi Nakamoto.
4. Altcoin: Any cryptocurrency other than Bitcoin.
5. Ethereum (ETH): A decentralized platform that enables smart contracts and decentralized applications (DApps) to be built and run without any downtime, fraud, control, or interference.
6. Smart Contract: A self-executing contract with the terms of the agreement directly written into lines of code.
7. Decentralized Application (DApp): An application that runs on a decentralized network, typically using blockchain technology.
8. ICO (Initial Coin Offering): A type of funding using cryptocurrencies, often used by startups to bypass the rigorous and regulated capital-raising process required by venture capitalists or banks.
9. Token: A digital asset issued on a blockchain, representing a unit of value.
10. Stablecoin: A type of cryptocurrency designed to have a stable value, typically pegged to a fiat currency or other stable asset.
11. Mining: The process by which transactions are verified and added to the blockchain, also the means through which new bitcoins or some other cryptocurrencies are created.
12. Proof of Work (PoW): A consensus mechanism that requires participants to solve complex mathematical puzzles to validate transactions and create new blocks.
13. Proof of Stake (PoS): A consensus mechanism that selects validators in proportion to their quantity of holdings in the associated cryptocurrency.
14. Hash: The output of a hash function, used to uniquely identify data.
15. Node: Any computer that connects to a blockchain network.
16. Wallet: A digital tool (software, hardware, or paper) that stores public and/or private keys for cryptocurrency transactions.
17. Private Key: A secret key used to encrypt and decrypt messages in cryptocurrency transactions.
18. Public Key: A cryptographic key that can be publicly shared and is used to receive cryptocurrency transactions.
19. Decentralized Finance (DeFi): Financial services built on blockchain technology that do not rely on centralized intermediaries such as banks.
20. Fork: A split in a blockchain network, creating two separate chains.
21. Airdrop: A distribution of cryptocurrency tokens for free to a large number of wallet addresses.
22. Gas Fee: A fee paid to conduct a transaction or execute a contract on the Ethereum blockchain.
23. Cold Wallet: A cryptocurrency wallet that is not connected to the internet, used for secure storage.
24. Hot Wallet: A cryptocurrency wallet that is connected to the internet, used for frequent transactions.
25. Ledger: A record-keeping system for all transactions in a blockchain.
26. Consensus Mechanism: A process used to achieve agreement on a single data value among distributed processes or systems.
27. Decentralized Autonomous Organization (DAO): An organization represented by rules encoded as a computer program that is transparent, controlled by shareholders, and not influenced by a central government.
28. Liquidity Pool: A collection of funds locked in a smart contract that provides liquidity for decentralized exchanges (DEXs).
29. NFT (Non-Fungible Token): A type of cryptographic token that represents a unique asset.
30. Oracles: Services that provide external data to blockchain applications, often necessary for executing smart contracts.
31. 51% Attack: An attack on a blockchain where a single entity or group controls more than 50% of the network’s mining power, allowing them to manipulate the blockchain.
32. Merkle Tree: A data structure used in blockchain for efficient and secure verification of data.
33. Sharding: A method of splitting and distributing the blockchain across multiple nodes to improve scalability.
34. Sidechain: A separate blockchain that is attached to its parent blockchain using a two-way peg.
35. Atomic Swap: A technology that allows the exchange of one cryptocurrency for another without the need for a centralized exchange.
36. KYC (Know Your Customer): A process by which financial institutions verify the identity of their clients to prevent fraud, money laundering, and terrorist financing.
37. AML (Anti-Money Laundering): Regulations and procedures aimed at preventing criminals from disguising illegally obtained funds as legitimate income.
38. Fiat Currency: Legal tender whose value is backed by the government that issued it, such as USD, EUR, VND.
39. Decentralized Exchange (DEX): A type of cryptocurrency exchange that operates without a central authority.
40. Centralized Exchange (CEX): A cryptocurrency exchange managed by a central entity, such as Binance or Coinbase.
41. Initial Exchange Offering (IEO): A type of token sale administered by a cryptocurrency exchange on behalf of a token issuer.
42. Halving: The process in which the reward for mining new blocks is halved, usually occurring every four years in Bitcoin.
43. Staking: The process of holding funds in a cryptocurrency wallet to support the operations of a blockchain network.
44. Yield Farming: The practice of staking or lending crypto assets to generate high returns or rewards in the form of additional cryptocurrency.
45. Liquidity Mining: The process of providing liquidity to a DeFi protocol and receiving rewards in the form of tokens.
46. Governance Token: A token that allows holders to vote on decisions regarding the blockchain or protocol.
47. Wrapped Token: A token that represents another cryptocurrency on a different blockchain.
48. Cross-Chain Technology: Technology that enables interoperability between different blockchain networks.
49. Layer 2 Solutions: Protocols built on top of a blockchain to increase scalability and efficiency, such as the Lightning Network.
50. Hashrate: The total computational power used to mine and process transactions on a blockchain.
51. Genesis Block: The first block in a blockchain.
52. Merkle Root: A hash that represents the root of a Merkle tree, summarizing all the transactions in a block.
53. Validator: A participant in a Proof of Stake (PoS) consensus mechanism responsible for validating transactions and creating new blocks.
54. Lightning Network: A Layer 2 solution for Bitcoin that enables fast and low-cost transactions through payment channels.
55. Plasma: An Ethereum Layer 2 scaling solution that allows for the creation of child chains to process transactions off the main Ethereum chain.
56. State Channel: A Layer 2 scaling solution that allows transactions to be conducted off-chain, with only the final state recorded on the blockchain.
57. Hyperledger: An open-source project that provides frameworks and tools for developing blockchain applications for enterprises.
58. Digital Identity: An online or networked identity adopted or claimed in cyberspace by an individual, organization, or electronic device.
59. Interoperability: The ability of different blockchain networks to communicate and interact with each other.
60. DAG (Directed Acyclic Graph): A data structure used in some blockchain systems to achieve consensus without the need for a traditional blockchain.
61. Gas Limit: The maximum amount of gas that can be used in a single transaction on the Ethereum network.
62. Gas Price: The amount of Ether a user is willing to pay for each unit of gas to process a transaction on the Ethereum network.
63. Multi-Signature (Multi-Sig): A method of requiring multiple keys to authorize a cryptocurrency transaction.
64. Rekt: Slang term used to describe someone who has experienced significant financial loss in the cryptocurrency market.
65. Whale: An investor who holds a large amount of a particular cryptocurrency, capable of influencing the market.
66. Paper Wallet: A printed piece of paper containing a public and private key pair, used for storing cryptocurrency offline.
67. Brain Wallet: A type of cryptocurrency wallet where the private key is derived from a memorized phrase or password.
68. Dust Transactions: Very small transactions that are often used to clog up the blockchain network.
69. Colored Coins: Tokens on the Bitcoin blockchain that represent real-world assets.
70. Timestamping: The process of recording the time at which a transaction is made on the blockchain.
71. Sybil Attack: An attack where one person tries to take over a network by creating multiple nodes.
72. Hard Fork: A radical change to the protocol of a blockchain network that results in a split, creating two separate chains.
73. Soft Fork: A backward-compatible update to the blockchain protocol.
74. Proof of Authority (PoA): A consensus mechanism where transactions are validated by approved accounts, known as validators.
75. Proof of Burn (PoB): A consensus mechanism where miners “burn” coins by sending them to an address where they are irretrievable, to gain the right to mine new blocks.
76. Proof of Capacity (PoC): A consensus mechanism that uses the storage capacity of mining devices to decide mining rights.
77. Proof of Space (PoSpace): A consensus mechanism similar to PoC, utilizing hard drive space for mining.
78. Proof of Elapsed Time (PoET): A consensus mechanism that uses a randomized timer to determine mining rights, commonly used in Hyperledger Sawtooth.
79. Zero-Knowledge Proof (ZKP): A cryptographic method that allows one party to prove to another that they know a value without revealing the value itself.
80. zk-SNARK: Zero-Knowledge Succinct Non-Interactive Argument of Knowledge, a type of ZKP that allows for proving possession of certain information without revealing that information and without interaction between the prover and verifier.
81. zk-STARK: Zero-Knowledge Scalable Transparent Argument of Knowledge, an advanced form of zk-SNARK that does not require a trusted setup and offers higher scalability.
82. Ring Signature: A type of digital signature that can be performed by any member of a group of users that each have keys, making it impossible to identify the actual signer.
83. CoinJoin: A method of anonymizing Bitcoin transactions by combining multiple transactions into one, making it difficult to trace individual transaction participants.
84. Mixer (Tumbler): A service that mixes potentially identifiable cryptocurrency funds with others to obscure the trail back to the original source.
85. Lightning Network: A second-layer solution for Bitcoin that allows for off-chain transactions to increase the speed and lower the cost of transactions.
86. Segregated Witness (SegWit): An upgrade to the Bitcoin protocol that separates the transaction signature (witness data) from the transaction data, allowing for increased block capacity and security improvements.
87. Atomic Swap: A smart contract technology that enables the exchange of one cryptocurrency for another without using centralized intermediaries.
88. Colored Coin: A method for representing and managing real-world assets on the Bitcoin blockchain by attaching metadata to Bitcoin transactions.
89. Masternode: A special type of node in some blockchain networks that performs additional functions such as processing transactions and governance tasks in return for rewards.
90. Peer-to-Peer (P2P): A decentralized communications model in which each party has the same capabilities and either party can initiate a communication session.
91. Directed Acyclic Graph (DAG): A data structure used in some blockchain systems to allow for the scalable and efficient processing of transactions.
92. Testnet: A parallel blockchain to the main blockchain used for testing new features and applications without risking real assets.
93. Mainnet: The main, fully operational blockchain network where actual transactions occur with real assets.
94. Airdrop: The process of distributing cryptocurrency tokens to a large number of wallet addresses, often for promotional purposes or as rewards.
95. Burning: The process of permanently removing tokens from circulation, usually to reduce supply and potentially increase value.
96. Whitepaper: A detailed report or guide published by a project to describe its technology, features, and purpose.
97. Roadmap: A strategic plan that outlines the goals and milestones of a project over a period of time.
98. Cold Storage: The practice of keeping a reserve of cryptocurrency offline, usually to prevent hacking or theft.
99. Nonce: A random or semi-random number used once in cryptographic communication to ensure that old communications cannot be reused in replay attacks.