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Web3 Glossary: A Comprehensive guide

web3 glossary book in neon colors

Welcome to our Web3 Glossary — a comprehensive guide to the terminology shaping the world of digital assets, decentralized technologies, and the next-generation internet. In this web3 glossary, you’ll find succinct explanations of key concepts, from blockchain fundamentals and tokenomics to the exciting realms of NFTs, DeFi, and Web3 innovations. Whether you’re a seasoned enthusiast or just embarking on your journey into this dynamic crypto landscape, this glossary is your go-to resource for understanding the language that powers the future of finance, creativity, and online interactions…

# TOP 50 used terms in web3

A

  • Airdrop: Distributing free tokens to a specific group of users as a marketing or promotional strategy.
  • Address: A unique identifier associated with a wallet, used for sending and receiving cryptocurrencies.
  • All-Time High (ATH): The highest price level that a cryptocurrency or token has reached in its trading history.
  • Alpha: Important infirmation first hand without much public circulation yet. There are also so called alpha groups
  • AMA: A live Q&A “ask me anything” session where users and/or holders (on discord or twitter/x) can ask questions to the team involved in a web3 project.
  • Ape in: means to invest or participate in a project without much research or caution, often driven by speculation or FOMO (Fear of Missing Out).
  • Assets: digital items or tokens, such as cryptocurrencies, non-fungible tokens (NFTs), and other blockchain-based holdings with value.

B

  • Blockchain: A distributed and immutable digital ledger that records transactions across a network of computers.
  • Burn: The intentional and irreversible removal of cryptocurrency tokens from circulation.
  • Burner Wallet: A wallet with only the amount of crypto necessary to avoid loss when connected to websites during minting or buying NFTs from questionable projects. It’s not advisable to store assets, tokens, or NFTs on burner wallets; successful acquisitions should be transferred to a secure wallet.
  • Bullish: The opposite of “Bearish,” indicating the belief that the value of an asset will increase in the future.
  • Bearish: Refers to a market or a specific project being on a downward trend.
  • Bluechips: Typically refers to the most well-known projects or tokens with high stability, such as CryptoPunks or Bored Ape Yacht Club.
  • Bots: An automated software designed to perform specific actions, like automatic minting when a mint window opens, trading when a certain threshold is reached, or buying when an NFT is offered below a certain price.
  • Bridge: A connection that allows tokens to be transferred from one blockchain to another for a fee.

C

  • Cold Wallet: A cryptocurrency wallet that is not connected to the internet, providing enhanced security.
  • Cross-Chain: Interoperability between different blockchain networks, allowing assets and data to move seamlessly.
  • Cryptocurrency: Digital or virtual currency that uses cryptography for secure transactions and operates on decentralized networks.
  • Cryptocurrency Exchange: Online platforms that facilitate the trading of cryptocurrencies and tokens.
  • Claim: As the holder of a specific NFT, you may be rewarded by the project and have the right to mint another NFT for free. Unlike an airdrop, in this case, you typically need to take proactive steps, adhere to a specific time window, and cover the gas fees yourself.
  • Coin: The primary digital currency on a specific blockchain, for example, Ether on the Ethereum blockchain, Matic on Polygon, Avax on Avalanche, and so on.
  • Collectible: An NFT that has or is intended to have value to collectors.
  • Crypto Twitter: The exchange of ideas and discussions about cryptocurrency, Web3, and NFTs primarily takes place on Twitter.

D

  • DAO (Decentralized Autonomous Organization): Organizations governed by code and votes from token holders, making decisions collectively.
  • DApp (Decentralized Application): Applications that run on decentralized networks like blockchains, offering enhanced security and transparency.
  • Decentralization: The distribution of control and decision-making across a network, rather than a single centralized entity.
  • Decentralized Finance (DeFi): Financial services and applications built on blockchain networks, aiming to provide open and permissionless alternatives to traditional financial systems.
  • DEX (Decentralized Exchange): Platforms that enable peer-to-peer trading of cryptocurrencies without a central authority.
  • Degen: Short for ‘Degenerate.’
  • Delist: The cancellation of the sale offer of an NFT on an exchange.
  • Derivatives: Financial instruments or contracts whose value is derived from an underlying asset, often used for speculative trading or risk management.
  • Devs: Short for “Developers.” A well-known quote: “Can the devs do something?” Once, an NFT holder apparently invested their entire fortune in an NFT, and the project’s floor price kept dropping. They publicly asked if the developers could do something about it. This is often humorously quoted when prices are falling because the market typically determines the price.
  • Diamond Hands: Describes an NFT holder who, regardless of market fluctuations, continues to hold a specific NFT and has no intention of selling it.
  • Discord: A chat platform originally used by gamers and now of significant importance for communication within various NFT projects.
  • Doxxed: When the identity of an NFT team member or founder is known or publicly disclosed. This provides trust and transparency to the NFT project, reducing the likelihood of falling victim to a rug pull or scam.
  • Dutch Auction: A specific type of auction where the price starts at a peak and decreases at set intervals.
  • DYOR: “Do your own research.” It means that you should conduct your own investigation and due diligence.

E

  • ENS (Ethereum Name Service): A service provider that sells domains with the .eth extension. This allows you to replace your long Ethereum address, making it easier for others to identify your wallet.
  • ERC-721 Token: A token standard that allows for the creation of unique, non-fungible tokens (NFTs). In contrast, ERC-20 tokens are used to mint fungible tokens (cryptocurrencies). There’s also ERC-1155 tokens, which are a hybrid – they are interchangeable NFTs but are also associated with specific owners, and each holder can set the price of their NFT.
  • Etherscan: A blockchain explorer, which is a tool that provides a view of the blockchain, enabling users to access information about all transactions.

F

  • FOMO (Fear of Missing Out): The psychological phenomenon where individuals fear missing out on potential gains in the market.
  • FUD (Fear, Uncertainty, Doubt): Negative information or rumors spread to create fear and uncertainty in the market.
  • Fork: A software update or modification to a blockchain’s protocol, which can result in a divergence in the blockchain’s history.
  • Flip: To purchase an NFT at a low price and sell it at a higher price, exclusively with the goal of quickly making a profit.
  • Floor: Floor Price (FP): The lowest price for an NFT from a collection, regardless of the specific rarities of individual items.
  • Floor sweep: The act of purchasing multiple inexpensive NFTs from a collection, causing the lowest price to increase.
  • Fractional Art / Fractional Ownership: Owning a portion of an (art) NFT, meaning having a fractional share or ownership stake in it.

G

  • Gas Fee: The fee paid in cryptocurrency for processing transactions or executing smart contracts on a blockchain network.
  • Gas Limit: The maximum amount of gas a user is willing to spend for a transaction on a blockchain network.
  • Gas Price: The amount of cryptocurrency a user is willing to pay per unit of gas for transaction execution.
  • GM: stands for “Good Morning.” In NFT culture, it is considered part of NFT etiquette to greet others with “GM” in the morning and bid them farewell with “GN” in the evening.

H

  • Halving: A programmed reduction in the block reward of a cryptocurrency, often occurring at regular intervals.
  • HODL: A misspelled term derived from “hold,” indicating a long-term investment strategy despite market volatility.
  • Hot Wallet: A cryptocurrency wallet connected to the internet, used for frequent transactions and accessibility.

I

  • Immutable: Data or records that cannot be altered or deleted once added to a blockchain.
  • IRL; In Real Life

K

  • KYC: Stands for “Know Your Customer,” which refers to the process of verifying or identifying individuals using an ID or passport. In the Web3 context, KYC is typically uncommon.

L

  • Liquidity Pool: Funds provided by users to a DeFi protocol, used for trading and lending within the ecosystem.
  • LFG: Let´s Fucking Go

M

  • Market Cap: The total value of a cryptocurrency calculated by multiplying its current price by the total circulating supply.
  • Mempool: A storage area in a blockchain where valid but unconfirmed transactions wait to be included in a block.
  • Metaverse: A virtual shared space merging physical and digital reality, often associated with NFTs and virtual reality.
  • Mining: The process of validating transactions and adding them to a blockchain, often involving proof-of-work or proof-of-stake mechanisms.
  • Mint: The initial issuance of an NFT onto the blockchain.
  • Mods: Refers to the moderator or person responsible for maintaining a healthy and informative exchange on the project’s utilized platforms, typically on platforms like Discord or Twitter.
  • Multisig Wallet: A wallet that requires authorizations from multiple parties for a transaction, particularly relevant for DAOs (Decentralized Autonomous Organizations).
  • McDonald’s: In a humorous context, this refers to the “Plan B” job if someone doesn’t succeed in the Web3 space.
  • Metadata: The necessary and unique information that represents and defines the appearance of an NFT.
  • Metamask (MM): A free and widely used browser wallet (also available as a mobile app) that enables interaction with the Ethereum blockchain and corresponding dApps (decentralized applications).

N

  • NFT (Non-Fungible Token): Unique digital assets representing ownership of a specific item, artwork, collectible, or content.
  • NFT Marketplace: Platforms where users can buy, sell, and trade non-fungible tokens.
  • NFA (no financial advice): It means “no financial advice,” indicating that the information provided is not intended as financial guidance.
  • NGMI (Not going to make it): A term used to suggest that something or someone is not likely to succeed.
  • Non-custodial Wallet: A wallet that provides users with complete control over their private keys. The most well-known non-custodial wallets include Metamask, Ledger, and Trezor.
  • Not your keys – not your coins: This is an important saying, emphasizing that as long as you don’t have full control over the private keys, someone else has control over the assets stored in the wallet.
  • Noob: Refers to a newcomer or novice in a particular field or activity.

O

  • Oracles: Services that provide real-world data to smart contracts, enabling them to interact with external information.
  • OG (Original Gangster): Refers to someone who is an experienced or veteran member of a group or community.
  • Open Edition: An NFT that can be minted without a limit. In contrast, there are “Limited Edition” NFTs, such as a collection with only 10,000 editions.
  • OS (short for OpenSea): OpenSea is a popular NFT marketplace.

P

  • Private Key: A cryptographic key that allows access to a wallet and control over associated assets.
  • Proof of Stake (PoS): A consensus mechanism where validators are chosen to create new blocks based on the amount of cryptocurrency they hold and “stake” as collateral.
  • Proof of Work (PoW): A consensus mechanism in which miners solve complex mathematical puzzles to validate transactions on a blockchain.
  • Public Key: A cryptographic key derived from a private key, used for receiving cryptocurrency transactions.
  • P2E (Play to earn): A term used to describe gaming models in which players can earn rewards or assets within the game.
  • Paper hands: Refers to someone who quickly sells an NFT, often at what is perceived as a low value, due to a lack of confidence in holding onto it.
  • PFP (Profile Picture Project): Projects where people use NFTs as their profile pictures on social media or other platforms.
  • Poap (Proof of Attendance Protocol): A digital proof of attendance for Web3 events, whether they are live or online.
  • Probably nothing: Although it means “probably nothing,” in the context of NFTs, it is used ironically and is often a hint at something that may be significant.

R

  • Raids: Community-planned advertising campaigns, usually on Twitter, where as many users as possible promote a specific NFT project to increase its visibility.
  • Rarity: The value of an NFT increases based on how rare a particular trait or characteristic is within it.
  • Rekt: Derived from the word “wrecked,” it means “destroyed” or experiencing a significant loss.
  • Reveal: Often, a project is minted, but the NFT’s traits and rarity are hidden until a later point known as the “reveal.”
  • Refresh Metadata: To see the revealed NFT on platforms like OpenSea, it may take some time for the metadata to update, and you can help speed up the process by clicking “refresh metadata.”
  • Revoke: In decentralized applications like OpenSea or Uniswap, certain permissions are granted to these apps to perform transactions with ERC20, ERC721, and ERC1155 tokens. However, these allowances can pose security risks. It’s important to regularly check which permissions you’ve granted to which platforms and potentially revoke them.
  • Right click – save as: An ironic expression used by people who don’t believe in NFTs to mock the NFT space. They claim that by saving the JPEG image, they possess the NFT for free.
  • Roadmap: A description of the individual steps and plans of a project.
  • Royalties: Fees automatically paid to the NFT creator when the NFT is resold in the secondary market, provided it’s programmed into the smart contract.
  • Rug or Rugpull: A project set up from the start as a scam, where the founder disappears once they receive the funds from the minting process, leaving investors with worthless tokens.

S

  • Scaling Solution: Techniques to enhance the transaction processing speed and capacity of a blockchain network.
  • Seed Phrase: A series of words used to generate and recover a cryptocurrency wallet’s private keys.
  • Smart Contract: Self-executing contracts with code that automatically executes terms when predefined conditions are met.
  • Smart NFT: Non-fungible tokens with embedded programmable logic, allowing for dynamic interactions and features.
  • Staking: Holding and “staking” a cryptocurrency in a wallet to support network operations and earn rewards.
  • Snapshot: Like a blockchain screenshot, it captures the NFT owners at a specific moment for various purposes, such as determining eligibility for airdrops or claims, or for voting in a DAO election.
  • Stable Coin: A cryptocurrency actively managed to have minimal deviation from a national currency.
  • Satoshi: The smallest unit of Bitcoin (0.00000001 BTC), named after the creator of Bitcoin.
  • Secondary market: After the initial minting, NFTs are only sold on the secondary market. The most well-known secondary market for NFTs is OpenSea. Many projects are working on developing their own markets to bypass the fees on the secondary market, which are typically around 2.5% on OpenSea.
  • Shilling: Promoting or advertising a product or project.

T

  • Token: A digital representation of an asset, often used to represent ownership in a blockchain-based ecosystem.
  • Tokenomics: The economic model and rules governing the distribution and use of tokens within a blockchain ecosystem.

U

  • Utility: Refers to the usefulness or practical value of an NFT.

W

  • Wallet: Software or hardware tools used to store, send, and receive cryptocurrencies and tokens securely.
  • Whitepaper: A document outlining the concept, technology, and goals of a cryptocurrency or blockchain project.
  • Wrapped Token: Tokens pegged to the value of another asset, often used to bring non-native assets onto a blockchain.
  • WAGMI: “We’re all gonna make it,” signifying a shared belief that everyone will succeed.
  • Wen Lambo / Wen moon: Short for “When will this project take off to the point where I can afford a Lamborghini?”
  • Whale: An individual or entity holding a significant amount of a cryptocurrency, capable of influencing the market.
  • Whitelist: A list of wallets that receive special privileges, such as the ability to mint before the general public or at a discounted price, depending on the project (also known as an Allowlist).
  • Web3: The next evolution of the internet, focused on decentralization, interoperability, and user control.

Y

  • Yield Farming: A DeFi practice where users provide liquidity to protocols in exchange for rewards or interest.

For more web3 terms, you can also check the Words of Crypto glossary from Binance.

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