Understanding the new digital frontier can be overwhelming — especially when every article is filled with jargon. This glossary of key terms will help you decode the most important concepts in the world of cryptocurrency, NFTs, and Web3 so you can navigate with confidence.
Common Crypto & Blockchain Terms
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- Blockchain:
A decentralized digital ledger where transactions are recorded across many computers. It’s the foundation of cryptocurrencies like Bitcoin and Ethereum. - Cryptocurrency:
A digital or virtual currency secured by cryptography, used for peer-to-peer transactions and value storage. - Wallet (Hot & Cold):
A digital wallet stores your private keys. Hot wallets are connected to the internet; cold wallets (like Ledger or Trezor) are offline for extra security. - Private Key & Public Key:
The private key is like your password — never share it. The public key is your wallet address that others can send crypto to. - Gas Fees:
Fees paid to complete transactions on the blockchain (especially Ethereum). These can vary depending on network congestion.
- Blockchain:
Web3 & Decentralized Concepts
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- Web3:
The third generation of the internet — decentralized, user-owned, and built on blockchain. - dApps (Decentralized Applications):
Apps that run on a blockchain network, without central control. Examples: Uniswap, OpenSea. - DAO (Decentralized Autonomous Organization):
A group or community governed by smart contracts where decisions are made by token holders. - Smart Contract:
A self-executing contract with the terms of agreement written in code, enabling trustless transactions. - Staking:
Locking up your cryptocurrency to support a blockchain network and earn rewards.
- Web3:
NFT & Digital Collectibles Vocabulary
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- NFT (Non-Fungible Token):
A unique digital asset that proves ownership of an item, like art, music, or in-game assets. Cannot be exchanged 1:1 like cryptocurrencies. - Minting:
The process of creating a new NFT on a blockchain. - Floor Price:
The lowest price for an NFT in a specific collection currently available for sale. - Royalties:
Earnings automatically paid to the original creator each time their NFT is resold. - Metadata:
The information attached to an NFT — image, description, traits, etc.
- NFT (Non-Fungible Token):
DeFi & Investment Terminology
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- DeFi (Decentralized Finance):
Financial services like lending, borrowing, and trading built on blockchain, without traditional banks. - Liquidity Pool:
A collection of crypto locked in a smart contract to facilitate decentralized trading and earning rewards. - Yield Farming:
A way to earn passive income by moving crypto assets across DeFi protocols. - Airdrop:
Free distribution of tokens or NFTs to promote a project, often used as a marketing or reward tool. - Rug Pull:
A scam where project creators disappear with investor funds after raising money or minting NFTs.
- DeFi (Decentralized Finance):
Final Thoughts
This glossary of key terms is your starting point to confidently engage with the crypto and NFT world. Bookmark this guide and revisit as needed — the Web3 space is evolving fast, and understanding the language is the first step to making smart moves.
