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Crypto Glossary

Confused about crypto terms? We got you covered!

A

Account Leverage

Account leverage refers to the amount of borrowed funds or margin that a trader can use to increase their position in a particular cryptocurrency trade. By using leverage, traders can amplify their potential gains, but they also risk increasing their potential losses.

Address

In cryptocurrency, an address is a string of characters that uniquely identifies a particular wallet or account on a blockchain network. Cryptocurrency addresses are used to send and receive digital assets between different users or accounts on the network.

Allowance

In cryptocurrency, an allowance refers to the amount of funds that one user has granted permission for another user or smart contract to spend on their behalf. Allowances are commonly used in decentralized finance (DeFi) protocols to allow smart contracts to execute transactions on behalf of users.

Asset Diversification

Asset diversification is a strategy used by traders to reduce risk by trading a variety of different assets or asset classes. In the context of cryptocurrency, asset diversification may involve choosing multiple cryptocurrencies or other digital assets to spread risk and potentially increase returns.

ATH (All Time High)

An all time high (ATH) refers to the highest price that a particular cryptocurrency has ever reached. It is often used as a benchmark to measure the performance of a cryptocurrency over time.

Auction

An auction in the context of cryptocurrency refers to a process of selling or buying digital assets or tokens through an open bidding system. In an auction, buyers place bids on the assets, and the highest bidder wins the auction.

B

Bags

In the context of cryptocurrency, bags refer to the collection of digital assets or tokens that an individual holds in their portfolio. The term "bags" is often used to describe a significant amount of a particular cryptocurrency that a person holds.

Bear Market

A bear market in the context of cryptocurrency refers to a market trend in which the prices of digital assets are falling, and investors are selling their assets to avoid losses. It is characterized by a pessimistic sentiment, declining prices, and high selling pressure.

Bid Price

The bid price is the highest price that a buyer is willing to pay for a particular cryptocurrency or digital asset. It is the price at which a buyer is willing to purchase the asset.

Bids

In an auction, bids refer to the offers made by potential buyers to purchase a specific cryptocurrency or digital asset. It is the amount of money that a buyer is willing to pay for the asset.

Bitcoin

Bitcoin is a decentralized digital currency that uses a peer-to-peer network to facilitate transactions. It was created in 2009 by an unknown person or group using the pseudonym Satoshi Nakamoto. Bitcoin is the first and most well-known cryptocurrency.

Bitcoin Cash

Bitcoin Cash is a cryptocurrency that was created in 2017 as a result of a hard fork from the Bitcoin blockchain. It aims to provide faster and cheaper transactions than Bitcoin by increasing the block size limit.

Bitcoin Dominance

Bitcoin dominance is a measure of the percentage of the total cryptocurrency market capitalization that is made up of Bitcoin. It is calculated by dividing the market capitalization of Bitcoin by the total market capitalization of all cryptocurrencies.

C

Censorship-Resistance

Censorship-resistance is the ability of a blockchain network to resist censorship or control by any central authority or individual.

Circulating Supply

Circulating supply refers to the amount of a cryptocurrency that is currently available for trading.

Coin

A coin is a unit of value or digital currency that is native to a particular blockchain or cryptocurrency network.

Collateral

In the context of cryptocurrency, collateral refers to an asset that is pledged to secure a loan or other financial transaction. For example, if you want to borrow cryptocurrency, you may need to put up another cryptocurrency or a fiat currency as collateral.

Confirmation

In cryptocurrency, a confirmation refers to the process of verifying a transaction on the blockchain. When a transaction is confirmed, it means that it has been processed by the network and added to the blockchain.

Consensus Mechanisms

Consensus mechanisms are the protocols that cryptocurrency networks use to verify transactions and maintain the integrity of the blockchain. Examples of consensus mechanisms include proof of work (PoW), proof of stake (PoS), and delegated proof of stake (dPoS).

Cosmos

Cosmos is a decentralized network of independent blockchains that can communicate with each other through a hub called the Cosmos Hub. The Cosmos network is designed to be scalable, interoperable, and customizable. Learn more here.

Crypto Winter

Crypto winter refers to a period of time when the cryptocurrency market experiences a significant decline in prices and overall activity. The most well-known crypto winter occurred in 2018-2019.

D

DeFi (Decentralized Finance)

DeFi (Decentralized Finance) is a financial system built on blockchain technology. DeFi aims to create a financial system that is open and accessible to everyone. It provides financial services such as lending, borrowing, and trading without the need for intermediaries like banks. For example, many DeFi platforms are powered by smart contracts that enable peer-to-peer transactions.

Double Spend

Double spend refers to the act of spending the same cryptocurrency more than once. This can happen if the sender of the transaction is able to reverse the transaction before it is confirmed on the blockchain. However, double spending is prevented on blockchain networks through their consensus mechanisms, which ensures that each transaction is verified and recorded only once.

dYdX Foundation

The dYdX Foundation is a non-profit organization created to support the development and growth of the dYdX protocol. Its mission is to make decentralized governance and financial products accessible to everyone. The Foundation provides resources to developers and other contributors working on the dYdX ecosystem and is also in charge of the DYDX token.

dYdX Trading

dYdX Trading is the company that builds the product infrastructure of dYdX. dYdX allows users to trade cryptocurrency with up to 20x leverage across a variety of different markets. dYdX currently runs on audited smart contracts on Ethereum, which eliminates the need to trust a centralized exchange while trading.

E

Ethereum

Ethereum is a decentralized blockchain platform that enables the creation of smart contracts and decentralized applications (dApps). It is the second-largest cryptocurrency by market capitalization after Bitcoin.

F

Floor Price

Floor price refers to the minimum price that an asset is expected to reach or trade at. It is usually based on market trends and technical analysis.

G

Gas

Gas is a unit of measurement used to calculate the fees required to execute a transaction on a blockchain network.

Genesis Block

The genesis block is the first block in a blockchain network; it is the basis on which additional blocks are added to form the "chain."

Gwei

Gwei is a denomination of the cryptocurrency ether (ETH) and represents one-billionth of one ETH.

H

Halving

Halving is an event that occurs in the Bitcoin blockchain network, where the mining reward for successfully mining a block is cut in half.

HODL

HODL is a misspelling of the word "hold," and is a term used by cryptocurrency investors to express their intention to hold onto their cryptocurrency holdings for the long-term, regardless of short-term market fluctuations. It stands for "Hold on for Dear Life."

I

Immutable

Immutable refers to the characteristic of a blockchain network that ensures that once a transaction is recorded on the blockchain, it cannot be altered or deleted.

Index Price

The index price is the average price of a particular cryptocurrency on multiple cryptocurrency exchanges.

Interoperability

Interoperability refers to the ability of different blockchain networks to communicate and interact with each other seamlessly.

K

KYC (Know Your Consumer)

KYC is a regulatory requirement that is often seen in the cryptocurrency space. It requires users to provide identifying information, such as a government-issued ID or passport, to verify their identity. dYdX does not require KYC!

L

Ledger

A ledger is a record-keeping system that is used to track transactions in the cryptocurrency space. It is a distributed database that is maintained by a network of users, and it ensures that all transactions are secure and transparent.

Lending

Lending involves loaning out your cryptocurrency holdings to other users in exchange for interest. This is often done through a lending platform (like Aave), which connects lenders and borrowers.

Leverage

In traditional financial markets, using “leverage” means “borrowing funds.” In derivative financial markets, using leverage means putting up only a small portion of the value of a contract to obtain full exposure.  However, unlike with traditional financial markets and products no third party is putting up the balance of the value so there is no deemed borrowing; the leverage comes from the terms of the product.

Leverage Limit

A leverage limit is a restriction on the amount of leverage that a trader can use for a particular trade. This is often used to limit potential losses and to ensure that traders do not take on too much risk.

Leverage Trading

Leverage trading is a trading strategy that involves borrowing funds or obtaining increased exposure in order to make a trade with a larger position size than normal. This can amplify potential profits, but it also increases the risk of potential losses.

Liquidation

Liquidation is the process of closing out a leveraged position when the asset's price moves against the trader's position to the extent that the margin or collateral deposited is insufficient to cover the loss. In other words, it is the forced closure of a trader's position by the exchange or broker to prevent further losses beyond the trader's margin or collateral.

Liquidity

Liquidity refers to the ease with which an asset can be bought or sold in the market without affecting its price. High liquidity means that there is a high volume of buyers and sellers, making it easy to execute trades quickly at a fair price.

Long

Long refers to a bullish position in trading. When a trader goes long on a cryptocurrency, they are betting that the price of the asset will increase over time.

M

Maker

In cryptocurrency trading, a maker is a trader who adds liquidity to the market by placing limit orders on the order book. They are called makers because their orders "make" the market.

Margin Trading

Margin trading is a type of trading that allows traders to open leveraged positions that increase exposure to a given asset. This allows traders to amplify their potential gains (and losses) by trading with more capital than they actually have.

Maximum Supply

Maximum supply is the maximum amount of a cryptocurrency that can be mined or created.

Minimum Order Size

Minimum order size is the smallest amount of a cryptocurrency that can be bought or sold on an exchange.

Mining

The process of solving complex mathematical equations to verify transactions and create new cryptocurrency units.

N

Node

Node is a computer or device that participates in the processing and validation of transactions on a blockchain network.

O

Off-Chain

Off-chain are transactions that occur outside of the blockchain network and are settled later on the blockchain.

Offers

Orders to buy or sell a cryptocurrency at a specific price.

On-Chain

Transactions that occur on the blockchain network and are recorded permanently on the blockchain.

Oracle

A third-party service or platform that provides data and information to a smart contract on a blockchain network.

P

Protocol

A set of rules and standards that govern how a network or system operates, including how transactions are validated and how data is transmitted.

R

S

Satoshi

The smallest unit of bitcoin, equal to one hundred millionth of a bitcoin.

Step Size

Step size is the smallest factor allowed for order amounts on the market.

Swap

A swap refers to the exchange of one asset or currency for another at an agreed-upon rate. In the context of cryptocurrencies, it refers to the exchange of one cryptocurrency for another.

T

Taker

A taker is a market participant who takes liquidity from an order book by placing a market order or a limit order that is immediately filled.

Tick Size

Tick size refers to the minimum price increment that an asset can move in a particular market.

Ticker

A ticker is a symbol used to identify a particular asset or security on an exchange or trading platform.

Token

A token is a digital asset that is created and managed on a blockchain network. Tokens can represent various assets, such as currencies, commodities, or securities, or they can be used to access certain services or platforms.

Total Order Size

Refers to the total amount of a cryptocurrency that a trader wants to buy or sell at a particular price.

Transfer

Refers to the act of moving cryptocurrency from one address to another.

Trustless

Refers to a system or process that operates without the need for trust between parties, often achieved through the use of smart contracts on a blockchain.

V

Volume

Volume is the total amount of a cryptocurrency that has been traded over a specific period of time.

W

WalletConnect

WalletConnect is a bridging protocol that allows users to connect their cryptocurrency wallet to decentralized applications.

Withdrawal

A withdrawal in the context of cryptocurrency refers to the process of transferring digital assets from one wallet or exchange account to another. It involves sending a specified amount of cryptocurrency from one address to another.

0

0x

0x is an open-source, permissionless protocol that facilitates the decentralized exchange of Ethereum-based tokens. It enables developers to build their own decentralized exchanges (DEXs) and to integrate decentralized exchange functionality into their applications.

0x API

0x API is a product offered by the 0x protocol that allows developers to build applications that interact with various decentralized exchanges through a unified API. With the 0x API, developers can access liquidity from multiple decentralized exchanges, making it easier to build decentralized applications with access to a larger pool of liquidity.

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