Learning about the Web3 space is one of the most important things for any person looking to understand the future of technology. This Web3 glossary of terms will help you get more familiar with the usual jargon used in this space.
Web3 consists of a number of technologies, including blockchain, decentralized applications (dApps), non-fungible tokens (NFTs), and cryptocurrencies, that are all connected and used to create a new, more secure and trustless way of exchanging value and data.
The list of commonly used terminology in Web3 is an essential part of understanding how these technologies work and interact, and can be a great starting point for anyone looking to get involved in the space. Lets get into it!
Airdrop (noun, verb)
A marketing technique in which crypto projects send their native tokens directly to the wallets of their users in an effort to increase awareness and adoption.
Valuable or insider information, usually regarding the value of digital assets like cryptocurrencies and NFTs; a measure of the return on an investment over and above the return offered by the market or other benchmark.
Initially used to refer to any cryptocurrency that wasn’t Bitcoin, altcoin may now refer to any new cryptocurrency with a relatively small market cap.
short for altcoins.
Ape (noun, verb)
Someone who invests heavily into a cryptocurrency or stock, or the act of doing so. This is sometimes a reaction to hype and FOMO, or done without much knowledge of the asset. It should be noted, though, that this is generally a self-assigned term and does not carry a negative connotation.
ATH- All Time High (noun)
The highest price an asset has ever had.
ATL- All Time Low (noun)
the lowest price an asset has ever had.
Bear Market (noun)
A prolonged period of decline in a financial market.
Similar to a bear market, this refers to holding a pessimistic view of a market or asset’s value. If you are bearish on a certain cryptocurrency, you believe its value will decrease over time.
The very first decentralized, peer-to-peer, digital currency, created by the pseudonymous Satoshi Nakamoto in 2009.
A batch of transactions written to the blockchain. Every block contains information about the previous block, thus, chaining them together.
A publicly-accessible digital ledger used to store and transfer information without the need for a central authority. Blockchains are the core technology on which cryptocurrency protocols like Bitcoin and Ethereum are built.
Block Explorer (noun)
A tool for browsing information on a blockchain, such as transactions, wallet addresses, market caps, and hash rates.
A protocol allowing separate blockchains to interact with one another, enabling the transfer of data, tokens, and other information between systems.
Meaning “build,” a common intentional misspelling used in crypto circles in reference to the term HODL
Bull Market (noun)
A period where market prices are rising.
Similar to a bull market, this refers to holding an optimistic view that a market or asset will rise in price. If you are bullish on Bitcoin, you believe that its value will continue to rise over time.
The process of removing tokens from a cryptocurrency’s circulating supply, usually done by sending them to an inaccessible wallet address. Other digital assets, such as NFTs, can also be burned via the same process.
A hierarchical structure in which authority and control are concentrated within a small group of decision makers.
CEX- Centralized Exchange (noun)
Cryptocurrency exchange managed by a centralized business or entity.
i.e. Coinbase, Gemini, Kraken
CeFi- Centralized Finance (noun)
Centralized businesses that participate in crypto.
I.e. BlockFi, DCG, Grayscale
A cryptocurrency built on its own native blockchain, intended to be used as a store of value and medium of exchange within that ecosystem.
i.e. BTC, ETH
Any asset accepted as security for a loan, such as a physical asset like real estate, or a digital asset like an NFT.
Cold Wallet (noun)
An offline device used to store cryptocurrencies. Cold wallets can be hardware devices or simply sheets of paper containing a user’s private keys. Because cold wallets are not connected to the internet, they are generally a safer method of storing cryptocurrencies.
See also: hot wallet (antonym)
The state of agreement amongst the nodes on a blockchain. Reaching consensus is necessary for new transactions to be verified and new blocks to be added to the blockchain.
Consensus Mechanism (noun)
A process through which nodes on a blockchain come into agreement on a transaction or state of the network.
A digital asset designed to be used as a medium of exchange. Cryptocurrencies are borderless, secure, and maintained by blockchains as opposed to centralized banks or governments.
DAO- Decentralized Autonomous Organization (noun)
An organization based on open-source code and governed by its users. DAOs typically focus on a specific project or mission and trade the traditional hierarchical systems of legacy corporations for guidelines written on the blockchain.
Dapp- Decentralized Application (noun)
An application built on open-source code that lives on the blockchain. Dapps exist independent of centralized groups or figures and often incentivize users to maintain them through rewarded tokens.
In the context of the internet, data refers to a user’s personal information, such as name, age, location, interests, browsing history, device usage, purchasing habits, etc. Web3 aims to protect this personal data and give ownership of it back to the user.
DD – Due Diligence (noun)
The process of conducting your own research on a cryptocurrency, stock, or other asset before investing. Doing your own DD is essential, as opposed to making an investment based on what someone else says or does.
A system that operates without the control of a central figure or authority, and replaces it with a distributed peer-to-peer network.
Degen (noun, adjective)
Initially short for “degenerate gambler.” While this still refers to individuals involved with risky bets, degen may also refer more broadly to anyone involved in crypto and financial spaces. Like with “ape,” this is generally a self-assigned term and does not carry a negative connotation. Degens are a proud people who enjoy ridiculous call options on GME, buying the dip before paying their rent, and occasionally aping into shitcoins.
“Which one of you degens just bought $50K of XRP at its ATH?!”
DeFi- Decentralized Finance (noun)
The ecosystem of borderless, trustless, peer-to-peer financial tools being built on public blockchains without the use of banks. DeFi apps are built to be open and interconnected, allowing them to be used in conjunction with one another.
DEX- Decentralized Exchange (noun)
A peer-to-peer cryptocurrency exchange built on the blockchain. A DEX is run by its users and smart contracts instead of an intermediary figure or centralized institution.
i.e. Uniswap, 1inch, Sushiswap
Diamond Hands (noun, adjective)
A term implying that you are extremely bullish on a certain asset, and have no plans to sell regardless of market volatility, FUD, or extreme drops in price. Someone who holds onto a cryptocurrency or stock as it drops 40% in a day is said to have diamond hands.
See also: paper hands (antonym)
The level of computing power needed to verify transactions and mine blocks on a proof-of-work blockchain.
Difficulty Bomb (noun)
The process of increasing the difficulty of a proof-of-work blockchain in order to motivate the transition to another consensus algorithm (such as proof-of-stake in the case of Ethereum).
DYOR- Do Your Own Research
Similar to DD, this phrase is used to remind people to conduct their own investigation into an asset before investing in it.
EIP- Ethereum Improvement Proposal (noun)
A standard format for presenting a new feature or process to the Ethereum community.
ERC- Ethereum Request for Comments (noun)
The standard smart contract outline on which Ethereum-based smart contracts are built.
The Ethereum token standard (ERC-20), providing a standardized smart contract structure for fungible tokens.
An Ethereum token standard that allows for the formation of unique tokens, otherwise known as NFTs, or non-fungible tokens. Unlike the ERC-20 standard, ERC-721 tokens have specific properties that allow each to be uniquely identified and valued independently of one another.
An Ethereum token standard which allows for fungible, non-fungible, and semi-fungible tokens to be managed by a single smart contract simultaneously. These are commonly used in gaming and collectible trading to reduce the number of necessary transactions.
A public blockchain serving as the foundation for decentralized applications. Ethereum is a turing complete language, allowing for users to write and deploy complex, self-executing smart contracts which live on the blockchain.
short for “Few understand”. A rallying cry that crypto folks are still early in this space and will make a lot of money when mass adoption comes.
a currency established as legal tender, often backed and regulated by a government, such as the US Dollar.
a reference to the possible event of Ethereum becoming more valuable than Bitcoin, in terms of market cap. DISCLAIMER: Please do not mention the flippening to Bitcoin maxis. They will not think it is funny, and they will proceed to explain why Ethereum is a shitcoin.
FOMO – Fear Of Missing Out (noun)
A feeling of anxiety, stemming from missing out on an opportunity. In investing, this usually coincides with investors buying an asset after it has already seen a considerable increase in price, hoping to get in and out before a pullback occurs. This is known as “FOMOing in” or “aping in.”
Fork (noun, verb)
A change to a blockchain’s protocol. When these changes are minor, this results in a soft fork. When the changes are more fundamental, this may result in a hard fork, leading to the formation of a separate chain with different rules.
The process of locking an NFT into a smart contract, and then dividing it into smaller parts which are issued as fungible tokens. This lowers the price of ownership and allows artwork and other digital assets to be owned by a community.
FUD – Fear, Uncertainty, and Doubt (noun)
News around an asset that seems negative, but turns out to be false or blown out of proportion.
Full Node (noun)
A blockchain node which stores the blockchain’s complete history, as well as verifies and relays transactions.
Interchangeable; exchangeable with something else of the same kind.
a fee paid by a user to conduct a transaction or execute a smart contract on the Ethereum blockchain. This fee is dependent upon the transaction’s complexity as well as the current demand on the network.
Genesis Block (noun)
The very first block of a blockchain network.
Simply meaning “good morning,” gm is a common greeting used in crypto circles
Short for “gonna make it.” This term is frequently thrown around on Twitter to voice support for a project or person.
See also: NGMI (antonym)
A denomination of ether used as the unit of measure for Ethereum gas prices. 10^9 gwei = 1 ether.
Hard Fork (noun, verb)
A fundamental change to a blockchain that is not compatible with the existing protocol, requiring the formation of a new chain.
i.e. Bitcoin vs. Bitcoin Cash, Ethereum vs. Ethereum Classic
The process of taking an input of any size and producing a corresponding fingerprint of a fixed-length. Hashing allows a set of data to be secured, stored, and recalled using a unique identifier code. This is the backbone of blockchain technology, allowing data and transactions to be verified and stored in a secure manner.
A type of NFT that has become more popular is the profile picture, or PFP for short. They are small works of art that you might see as someone’s Twitter profile picture. People are paying attention to the big purchases that celebrities and people with a lot of power make. CryptoPunks, which came out in 2017, was the first PFP NFT.
The ability of a token to provide access to a service or the potential to create value for its holders.