Seed Phrase (Recovery Phrase)
A 12-24 word phrase that serves as the master backup for your wallet. It can restore access to all your funds on any compatible wallet. Never share it with anyone.
Private Key
A secret cryptographic code that proves ownership of your cryptocurrency and allows you to sign transactions. Your seed phrase derives your private keys.
Public Address
A shareable address (like an email address) where others can send you cryptocurrency. It's derived from your public key and is safe to share.
Hot Wallet
A cryptocurrency wallet that's connected to the internet. Convenient for transactions but more vulnerable to online threats.
Cold Wallet
A wallet that stores your private keys offline, not connected to the internet. Maximum security for long-term storage.
Hardware Wallet
A physical device (like a USB stick) that stores your private keys offline. Popular examples include Ledger and Trezor devices.
Gas Fees
Transaction fees paid to network validators (miners/stakers) for processing transactions on blockchains like Ethereum. Higher during network congestion.
Blockchain
A decentralized digital ledger that records all transactions across a network of computers. Each "block" contains transaction data and links to the previous block.
DeFi (Decentralized Finance)
Financial services built on blockchain technology that operate without traditional intermediaries like banks. Includes lending, borrowing, and trading.
dApp (Decentralized Application)
Applications that run on a blockchain network rather than centralized servers. Examples include decentralized exchanges and NFT marketplaces.
Smart Contract
Self-executing code stored on a blockchain that automatically enforces agreements when predetermined conditions are met.
NFT (Non-Fungible Token)
A unique digital asset on a blockchain that represents ownership of items like art, music, or collectibles. Each NFT is distinct and not interchangeable.
Staking
Locking up cryptocurrency to support network operations (like validating transactions) in exchange for rewards. Common in Proof of Stake networks.
Layer 2 (L2)
Secondary networks built on top of main blockchains to improve scalability and reduce fees. Examples include Polygon, Arbitrum, and Optimism for Ethereum.
Airdrop
Free distribution of cryptocurrency tokens to wallet addresses, often used for marketing or rewarding early users. Beware of fake airdrops that are scams.
Self-Custody
When you hold your own private keys rather than trusting a third party (like an exchange). "Not your keys, not your crypto."
Token
A digital asset created on an existing blockchain (like ERC-20 tokens on Ethereum), as opposed to a native coin with its own blockchain.
DEX (Decentralized Exchange)
A platform for trading cryptocurrencies directly between users without a central authority. Examples include Uniswap and SushiSwap.
CEX (Centralized Exchange)
A traditional cryptocurrency exchange operated by a company that holds your funds. Examples include Coinbase and Binance.
Phishing
A scam technique where attackers create fake websites or messages to trick you into revealing sensitive information like your seed phrase.
DYOR (Do Your Own Research)
Common advice in crypto to thoroughly research any project or investment yourself before committing funds.
Rug Pull
A scam where project developers abandon a project and run away with investor funds. Common in new or unverified projects.
HODL
Slang for "hold" - a strategy of holding cryptocurrency long-term regardless of price fluctuations, rather than trading.
Bridging
The process of transferring cryptocurrency from one blockchain network to another, typically through a bridge protocol.