web3 A to Z
GM Crypto Witches! Get ready to dive into the mystical world of Web3 with Crypto Witch Club's Ultimate Web3 Glossary — Web3 A to Z. We've brewed up a potion of common terms, kickass definitions, and some seriously witchy Web3 words to have in your spellbook. Spot something missing? Don't be shy – drop your thoughts in the comments, and we'll work our magic to keep this glossary as your #1 resource throughout your crypto journey!
This glossary originally appeared in our Web3 For Witches Guide — NFT Edition — July 2022
The Ultimate Crypto Witch Club web3 Glossary
10,000: A common number you will see in generative NFT collections, particularly PFP (“profile pic”) art NFTs.
Airdrop: In Web3, airdrop refers to sending cryptocurrency or NFTs for free to different wallet addresses. This is typically for promotional purposes or to reward holders.
Altcoin: Altcoin is short for ‘alternative coin’. An altcoin is any cryptocurrency that is NOT Bitcoin. This includes popular coins like Ethereum.
ATH: Short for “all-time high”. In web3, this refers to the highest ever price sold of a cryptocurrency or NFT.
ATL: Short for “all-time low”. In web3, this refers to the lowest ever price sold of a cryptocurrency or NFT.
Bear market: When asset prices drop by 20% or more from recent highs and remain low for an extended length of time. Often, bear markets in Web3 can see decreases much greater than 20%.
Bridge: A tool that allows you to move your cryptocurrency from one network to another.
Bull market: When asset prices price by 20% or more from recent lows and remain high for an extended length of time. Often, bull markets in web3 can see increases much greater than 20%.
Bitcoin: (BTC) — created in 2009 — is the first ever cryptocurrency. Launched at the height of the financial crisis, Bitcoin follows the ideas of a decentralized cryptocurrency set out in a whitepaper by ‘Satoshi Nakamoto’, a mysterious person or group of people that remains anonymous to this day.
Blockchain: A blockchain is a decentralized ledger — or a growing list of records (called blocks). These blocks form a chain of information (blockchain). Think of it as a fully transparent, unbreakable database.
Burn: In Web3, burn refers to when a user sends cryptocurrency or an NFT to a wallet address that does not exists. This increases scarcity and decreases the number of circulating cryptocurrency coins or NFTs in a collection.
Centralized exchange: An exchange that one can buy and sell cryptocurrency on that’s created by, run, and overseen by one company (CEX).
Cryptocurrency: A digital currency that runs on a blockchain. The blockchain allows for cryptocurrency to be secure without utilizing a third party (like a centralized bank).
Cryptography: The mathematical and computational practice of storing data. Bitcoin uses cryptography to process transactions and create new blocks.
Coin: A cryptocurrency that runs on its own blockchain.
Collectible: In Web3, a collectible is an NFT with rarity or a specified value — such as a trading card or metaverse accessory.
DAO: Decentralized automatous organizations. Some NFT teams structure their treasury and planning by forming a DAO — which allows for voting rights and distribution of funds for roadmap milestones. DAOs can also be non-profits, clubs, or for-profit companies.
DApp: A decentralized app. A DApp is like an app you might install on your phone or browser, but DApps employ blockchain technology. DApps can be a game, social network, or an exchange.
Decentralized exchange: An exchange that one can buy and sell cryptocurrency on that’s controlled through smart contracts without an intermediary (DEX).
Digital asset: (NFTs) can represent both physical and digital goods, services, and rewards.
Digital signature: An encrypted electronic signature that support identity authentication on the blockchain.
Degen: Short for degenerate, used as a term of endearment for early adopters and tastemakers involved in the NFT space.
DYOR: An acronym for “do your own research”.
ERC-20 Token: An ERC-20 token is a standard used for creating and issuing smart contracts on the Ethereum blockchain.
Ethereum: (ETH) was created by Vitalik Buterin in 2015 — six years after Bitcoin. Ethereum was launched as a proof-of-work cryptocurrency with smart contract functionality before transitioning into proof-of-stake to make the network more sustainable, faster, and scalable..
Etherscan: A tool used to verify gas prices and transactions on the Ethereum blockchain.
Farming: Yield farming is the process of using decentralized finance (DeFi) to maximize returns. You can hold utilize the cryptocurrency or collectible you hold to earn interest.
FIAT money: a type of currency declared legal tender by a government and not backed by any commodity such as gold or silver.
Flipping: In Web3, flipping is when a person buys then sell a NFT for a quick profit. (The opposite of holding).
Floor price: The lowest price of an NFT available for sale on a secondary market.
Gas: In Web3, gas is a fee required for a transaction. This fee isn’t paid to the current NFT holder, but paid to the miners of a blockchain’s network for facilitating transactions.
Generative art: Digital art — often NFTs — that has been created with the use of a machine algorithm.
GM: A common greeting in Web3 that’s an acronym for “good morning”.
GN: A common sign-off in Web3 that’s an acronym for “good night”.
GWEI: The smallest denomination of the cryptocurrency Ether (ETH).
HODL: An acronym for “Hold on for dear life”.
Holding: The process of holding your crypto assets and NFTs long-term.
Hardware wallet: A digital wallet that stores your private keys that are used to access your cryptocurrency and NFTs. A hardware wallet exists as a device that you can connect and disconnect from the internet.
Hot wallet: A software wallet connected to the internet that can hold NFTs and cryptocurrency.
ICO: An acronym for “initial coin offering”, similar to a stock IPO (initial public offering).
Layer 1: The base infrastructure of the blockchain (mainnet).
Layer 2: Secondary framework built on a pre-existing blockchain to increase scalability and efficiency.
Market capitalization: The total value of all the coins or tokens of a specified cryptocurrency that have been mined or minted.
Metaverse: A virtual reality that incorporates blockchain technology and digital ownership.
Mining: A metaphor for the computational work / cryptography that nodes in a blockchain network undertake to create new tokens.
Miners: In Web3, miners are the individuals that facilitate transactions on a proof-of-work blockchain.
Minting: In Web3, minting in the process of publishing a digital file on the blockchain, making it an NFT.
NFT: An acronym for non-fungible token.
Node: A device or computer that is connected to a network to support validating and relaying transactions.
PFP: PFP stands for “profile picture” — referring to NFTs (often generative) that holders often use as their profile pictures on social media.
Polygonscan: A tool used to verify gas prices and transactions on the Polygon blockchain.
Primary market: The platform where an NFT creator initially lists their NFT project for minting.
Private key: A private key is used as ownership of a blockchain address, access your funds, restore your wallet, and create digital signatures that can be verified — without revealing your full numerical sequence.
Proof of Stake (PoS): Using a proof-of-stake protocol, miners validate block transactions based on how many coins they themselves hold. This diminishes the need for large amounts of energy required to complete a transaction — as no complicated mathematical work is required to execute (as is required in PoW).
Proof of Work (PoW): A proof-of-work protocol uses mathematical equations that are complicated and require powerful computers to solve. Due to this, it can result in extremely high energy consumption.
Protocol: A set of rules — written into code — that tells the blockchain how to function.
Public key: A public key is a numerical code that allows you to receive cryptocurrency transactions. You can share your public key with others — unlike your private key (which allows you to access your own cryptocurrency and should never be shared).
Pump and dump: When a cryptocurrency or NFT project attracts early investors to raise the value of their coin or token (can include NFTs) and then halts and abandons project, taking the invested funds with them when they go. See rug pull.
Rarities: Some NFT projects feature rarities within collections — traits that are more or less common than others due to the frequency of deployment. An NFT with rarities is considered more valuable than others of that collection, as there are fewer available. Some rarities only become visible after minting.
Roadmap: A roadmap outlines the goals, strategies, and timeline of an NFT project to the community. Typically, plans for growth, marketing, and product development are included in the roadmap.
Rug pull: When a cryptocurrency or NFT project attracts early investors and then halts and abandons project, taking the invested funds with them when they go. See pump and dump.
RWA: In the context of cryptocurrency, RWA (Real World Assets) refers to the representation of tangible and verifiable assets, such as real estate or commodities, on a blockchain, providing a bridge between the physical and digital worlds in decentralized finance (DeFi) applications.
Satoshi Nakamoto: A pseudonym for a person or group of persons that developed Bitcoin and wrote the Bitcoin whitepaper in 2009.
Secondary market: A marketplace where sellers and collectors can resell, re-list, or auction their NFTs.
Seed phrase / Secret recovery phase: A collection of secret words, letters, and/or numbers that grants full access to your wallet. It’s used as a backup in case you forget or lose your password. *Never share your seed phrase with anyone. If you do, they will be able to access and transfer your assets.
Smart contract: Programs stored on the blockchain that run when predetermined conditions are met — such as executing a signature on an agreement.
Software wallet: A digital wallet stores your private keys that are used to access your cryptocurrency and NFTs. A software wallet exists as a software app (browser extension, phone app) and live online.
Soulbound token: A non-transferrable NFT that’s assigned to a wallet address and cannot be transferred.
Spot Bitcoin ETF: A financial instrument that allows investors to gain exposure to the price movements of Bitcoin without actually owning the cryptocurrency. Instead of physically holding Bitcoin, investors engage in contracts tied to the spot price of Bitcoin, operating through derivatives and futures contracts.
Stablecoin: A cryptocurrency pegged to a reference asset — which can be a fiat currency or commodity such as gold or oil.
Token: A cryptocurrency that runs on another coin’s blockchain.
WAGMI: An acronym that stands for ‘we’re all going to make it’ — often used on social media as a symbol of confidence for the project and / or industry.
Wallet: A cryptocurrency wallet holds your private keys to access your crypto and NFTs. You can send and receive cryptocurrencies and NFTs from your wallet.
Wallet address: A wallet address is the public unique numerical identifier of your wallet. A wallet address can only receive transactions to your wallet, so it’s safe to share with others.
Web3: web3 is a new iteration of the internet based on blockchain technology — incorporating decentralization, digital ownership, and token-based economics.
Web3 domain: decentralized domains that use blockchain technology, giving them the functionality to interact with dApps and smart contracts.
Whale: A ‘whale’ in cryptocurrency is an individual or entity that holds a large quantity of a specific coin or token (can include NFTs).
Whitepaper: A document that explains the purpose of a cryptocurrency project and how it works.
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