Glossary
Plain explanations of crypto and trading terms – from altcoin to stop-loss.
A
- Account rent
- A deposit in SOL that every Solana account must hold because it takes up space on all validators. When an empty account is closed, the deposit is returned.
- Explained in: Wallet and accounts
- Related terms: Token account
- Address poisoning
- A scam in which an attacker sends you a tiny amount from an address that looks like one you use, hoping you will later copy it from your history and send money to it.
- Explained in: Sending and receiving safely, Accounts, addresses and ENS
- Related terms: Phishing, Wallet
- Airdrop
- Free distribution of tokens to wallets, often as a reward for early users. Fake airdrops are a common scam to lure people to malicious sites.
- Explained in: Security: drainers, signing and fake airdrops
- Related terms: Wallet drainer, Phishing
- Algorithmic stablecoin
- A stablecoin that tries to hold its price with code and a second token instead of dollar reserves. If confidence breaks, it can lose its peg and fall to almost zero, as UST did in 2022.
- Explained in: Terra Luna crash: how a $40 billion stablecoin died
- Related terms: Stablecoin, Depeg
- Altcoin
- Any cryptocurrency other than Bitcoin. Most of them have a small market and many disappear over time.
- Explained in: Stablecoins, altcoins and memecoins
- Related terms: Memecoin, Stablecoin
- AML (anti-money laundering)
- Rules that make exchanges and banks check where money comes from, watch for suspicious transfers and report them to the authorities. Coins linked to crime can be frozen.
- Explained in: Binance and CZ: the $4.3 billion guilty plea, The Czech bitcoin scandal at the Ministry of Justice
- Related terms: KYC (know your customer), Exchange, MiCA
- Anti-phishing code
- A word you choose that an exchange puts into every email it sends you. An email without your code is not from the exchange.
- Explained in: Securing your exchange account
- Related terms: Phishing, Two-factor authentication (2FA)
- ATR (Average True Range)
- The average daily range of the price over the last 14 days, counting gaps. As a percentage of the price it shows how much the market usually moves in a day.
- Explained in: Supertrend and ATR, Market regimes and volatility
- Related terms: Market regime, Stop-loss
- Automated market maker (AMM)
- A liquidity pool of two tokens whose price is set by a formula from their amounts. The bigger a trade relative to the pool, the worse the price.
- Explained in: Swaps and aggregators
- Related terms: DEX, Slippage
B
- Backtest
- Testing exact trading rules on historical data, including costs. It shows how the rules would have done in the past – not how they will do.
- Explained in: The backtest and its traps
- Related terms: Overfitting, Trading rules
- Bank run
- A rush of customers withdrawing their money at the same time because they fear a bank or exchange is in trouble. If it does not hold all the deposits, it cannot pay everyone and may collapse.
- Explained in: FTX collapse: how 8 billion dollars vanished
- Related terms: Exchange, Liquidity
- Base fee
- The part of an Ethereum fee set by the network itself: it rises when blocks are more than half full and falls when they are emptier. It is burned, not paid to the validator.
- Explained in: Gas and fees
- Related terms: Gas, Priority fee, Gwei
- Beta
- How much an asset moves on average when the market moves 1%. A beta of 1.5 against Bitcoin means 1.5% on average when Bitcoin moves 1%. It changes over time.
- Explained in: ETH versus BTC, SOL versus BTC and ETH
- Related terms: Correlation, Volatility-based position sizing
- BIP39
- The standard by which a wallet turns a seed phrase of 12 or 24 words from a list of 2,048 into all its keys. Thanks to it, one phrase can be restored in many different wallets.
- Explained in: Keys, seed phrase and address
- Related terms: Seed phrase, Passphrase
- Bitcoin dominance
- Bitcoin's share of the market value of all cryptocurrencies. Rising dominance often means fear, falling dominance euphoria – a mood gauge, not a signal.
- Explained in: Correlation and Bitcoin dominance
- Related terms: Correlation, Altcoin
- Blind signing
- Approving a transaction whose details the wallet cannot display in readable form. You are signing something you cannot see – keep it switched off.
- Explained in: Sending and receiving safely, Bybit and Ronin hacks: North Korea's billion-dollar heists, Smart wallets and new upgrades
- Related terms: Hardware wallet, Smart contract
- Blob
- Cheap, temporary data space in Ethereum blocks used by rollups, introduced in March 2024. Blobs are deleted after about 18 days.
- Explained in: Why L2 fees are so low
- Related terms: Rollup, Layer 2 (L2)
- Block explorer
- A website for looking up any address, token or transaction on a blockchain – who holds a token, its authorities and its history.
- Explained in: How to check a token
- Related terms: Blockchain, SPL token
- Blockchain
- A shared record of transactions grouped into blocks. Each block is linked to the previous one by its hash, and copies are kept by many nodes, so nobody can quietly rewrite it.
- Explained in: What is a blockchain, Bitfinex hack: 120,000 BTC and the rapper who hid them, OneCoin: the $4 billion crypto with no blockchain, The Czech bitcoin scandal at the Ministry of Justice
- Related terms: Hash, Node, Decentralization
- Bollinger Bands
- A moving average with a band above and below it, usually two standard deviations away. The bands widen when the market is volatile and narrow when it is calm.
- Explained in: The indicator menu: what to turn on and what not, Bollinger Bands
- Related terms: Moving average, ATR (Average True Range)
- Bonding curve
- A preset formula on a launchpad by which a new token's price rises as people buy. After a set market value the token moves to a regular exchange pool.
- Explained in: Memecoins and launchpads
- Related terms: Memecoin, Automated market maker (AMM)
- Break of structure
- The moment the price breaks the last lower high in a downtrend (or the last higher low in an uptrend). An early warning that the trend may be ending, not a certainty.
- Explained in: Trend and market structure
- Related terms: Market structure, Trend
- Bridge
- A service that moves tokens between networks: it locks them on one and issues a wrapped copy on the other. Bridges are a frequent target of large hacks.
- Explained in: Bybit and Ronin hacks: North Korea's billion-dollar heists, Poly Network hack: the thief who gave back 610 million, Bridges and their hacks
- Related terms: Layer 2 (L2), Token
C
- Candlestick
- One element of a price chart showing four prices of one period: open, high, low and close. Green usually means the price rose, red that it fell.
- Explained in: Reading a candlestick chart
- Related terms: Timeframe, Trend
- CCI
- Commodity Channel Index: how far the typical price is from its average, measured in multiples of the usual deviation. ±100 are the usual reference lines.
- Explained in: CCI: how far from normal
- Related terms: Oscillator, Moving average
- Cold wallet
- A wallet whose keys never touch the internet – typically a hardware wallet. Safer for larger amounts, less convenient for frequent use.
- Explained in: Wallets, QuadrigaCX: the CEO who died with the only keys
- Related terms: Hot wallet, Wallet, Seed phrase
- Confirmation
- Each new block added after the block with your transaction. The more confirmations, the harder it is to reverse the transaction.
- Explained in: How a transaction works
- Related terms: Blockchain, Mempool
- Confirmation bias
- Looking for information that proves us right and overlooking the rest. Countermeasure: write down reasons why a trade might not work.
- Explained in: Thinking traps
- Related terms: Loss aversion, Trading journal
- Correlation
- How much two assets move together, from −1 (always opposite) to +1 (always together), calculated from daily changes. In crypto it rises under stress.
- Explained in: ETH versus BTC, Correlation and Bitcoin dominance, Correlated positions are one bet
- Related terms: Bitcoin dominance, Altcoin
- Cryptocurrency
- Digital money recorded on a blockchain, without a central issuer such as a bank. Ownership is proved with a private key.
- Explained in: Why cryptocurrencies at all
- Related terms: Blockchain, Private key, Altcoin
D
- DAC8
- An EU directive under which crypto-asset service providers report their users' transactions to tax authorities. It applies from 2026.
- Explained in: Records and taxes, Sustainable trading and what next
- Related terms: MiCA
- DCA (dollar-cost averaging)
- Investing a fixed amount at regular intervals, regardless of the price. It spreads purchases over time instead of trying to guess the best moment.
- Explained in: Investing vs. trading
- Decentralization
- Control is spread among many independent participants instead of one company or authority, so there is no single point that can stop or change the system.
- Explained in: What is a blockchain
- Related terms: Node, Blockchain
- Deepfake
- A fake video, image or voice recording made with AI that shows a real person saying or doing something they never did. Scammers use deepfakes of famous people to promote fake giveaways and investments.
- Explained in: Crypto giveaway scams: the 2020 Twitter hack and deepfakes
- Related terms: Social engineering, Phishing
- DeFi
- Decentralized finance – exchanges, loans and other financial services run by smart contracts without a bank or broker. Bugs and hacks can mean a total loss.
- Explained in: Ethereum and smart contracts, Celsius collapse: when 17% yield was too good to be true
- Related terms: Smart contract, Stablecoin
- Depeg
- When a stablecoin loses its fixed link to the asset it tracks, for example when a "dollar" token trades at 0.90 USD instead of 1 USD.
- Explained in: Terra Luna crash: how a $40 billion stablecoin died
- Related terms: Stablecoin, Algorithmic stablecoin
- DEX
- A decentralised exchange – a program on a blockchain where tokens are swapped directly from your wallet, without an exchange holding your money.
- Explained in: Swaps and aggregators
- Related terms: Automated market maker (AMM), Exchange, DeFi
- Divergence
- When the price and an indicator go different ways – for example the price makes a higher high while RSI makes a lower one. A warning that a move is losing strength, not a signal on its own.
- Explained in: OBV: a piggy bank for volume, Divergence
- Related terms: RSI, MACD
- Diversification
- Spreading money across investments or strategies whose results do not move together, so that one loss does not hit everything at once. Positions that are strongly correlated – such as most cryptocurrencies – spread the risk only a little.
- Explained in: Correlated positions are one bet
- Related terms: Correlation, Drawdown
- Double spending
- Spending the same money twice. With digital money this is the main problem to solve – a blockchain prevents it because every node checks the shared record.
- Explained in: Why cryptocurrencies at all
- Related terms: Blockchain, Confirmation
- Drawdown
- A drop of the account from its previous peak. A drawdown is harder to recover than to suffer: after −50% you need +100%.
- Explained in: Strategy metrics, Position size and R-multiples
- Related terms: R-multiple
E
- Edge
- A reason why a strategy should make more than it loses over many trades – for example a pattern in the market that others overlook. Edges fade over time, and many turn out never to have been real.
- Explained in: When a strategy stops working
- Related terms: Expected value, Overfitting, Backtest
- EMA
- Exponential moving average: an average of closing prices in which newer candles weigh more, so it reacts to a turn sooner than a simple average – and is fooled more often.
- Explained in: EMA and WMA: averages that favour the news, MACD: two trains and the gap between them
- Related terms: Moving average, WMA
- ENS (Ethereum Name Service)
- A service that gives an Ethereum address a readable name such as jana.eth. The name is rented for a period and can expire.
- Explained in: Accounts, addresses and ENS
- Related terms: Address poisoning
- Epoch
- A period on Solana of 432,000 slots – about two days with the original 0.4-second slots, about one day with the shorter slots introduced in 2026. The leader schedule is set for each epoch, and staking starts and ends at epoch boundaries.
- Explained in: Proof of stake and The Merge, Validators, proof of stake and Proof of History
- Related terms: Validator, Stake account
- Equity curve
- A chart of how the value of an account or strategy changes over time. Its drops from the last peak are drawdowns.
- Explained in: Drawdown rules
- Related terms: Drawdown, Backtest
- ERC-20
- The standard most tokens on Ethereum follow, such as USDC. A token is a contract with a table of balances; the real one is recognised by its contract address.
- Explained in: Tokens, NFTs and approvals
- Related terms: Token, Token approval
- ETF (exchange-traded fund)
- A fund whose shares trade on a stock exchange. A spot ETH ETF holds real ETH, so you can buy exposure through an ordinary broker without holding the coins yourself.
- Explained in: ETFs and institutions
- Related terms: Diversification
- EVM (Ethereum Virtual Machine)
- The virtual machine that runs smart contracts on Ethereum. Every node runs the same code and checks the result, so nobody can quietly change it. Many other networks are EVM-compatible.
- Explained in: The world computer
- Related terms: Smart contract, Gas
- Exchange
- A platform where you buy and sell cryptocurrencies. A centralized exchange holds your money and coins for you, so choose one with a licence.
- Explained in: How an exchange works
- Related terms: Order book, MiCA, KYC (know your customer)
- Exit scam
- A fraud in which the people running a platform or project collect customers' money, then shut it down and disappear with it – often behind a cover story such as "maintenance" or "a hack".
- Explained in: Thodex and Africrypt: crypto founders who vanished
- Related terms: Rug pull, Exchange
- Expected value
- The average result per trade: win rate × average win − loss rate × average loss, usually in R. Positive after costs is rare.
- Explained in: Expected value
- Related terms: R-multiple
F
- Finality
- The moment after which a block can no longer be reverted. On Ethereum a block is final after about two epochs (around 12.8 minutes).
- Explained in: Proof of stake and The Merge
- Related terms: Epoch, Confirmation
- Firmware
- The software inside a device such as a hardware wallet. Update it only from the manufacturer's official app; open-source firmware can be checked by independent experts.
- Explained in: How a hardware wallet works
- Related terms: Hardware wallet, Secure element
- FOMO
- Fear of missing out: buying because the price is rising and everyone celebrates – without a plan, often near the top.
- Explained in: Pump and dump: $LIBRA, $HAWK and celebrity memecoins, Why smart people fall for crypto scams, Emotions: FOMO, fear and revenge trading
- Related terms: Revenge trading, Trading plan
- Forward test
- Trading a strategy's rules in real time – first without money, then with small amounts – to check the backtest and whether you can follow the rules.
- Explained in: Forward testing and going live
- Related terms: Backtest, Trading journal
- Funding
- A payment between long and short traders of perpetual futures, usually every 8 hours, that keeps the contract price close to spot. When the contract trades above spot, longs pay shorts; below it, shorts pay longs.
- Explained in: Derivatives data as information, Spot vs futures: leverage, liquidation, funding
- Related terms: Futures, Leverage
- Futures
- Contracts on the price of an asset; you do not own the coin. In crypto mostly perpetual futures without an expiry date, traded with leverage, margin and funding.
- Explained in: Spot vs futures: leverage, liquidation, funding
- Related terms: Leverage, Margin, Liquidation, Funding
G
- Gas
- The fee for a transaction or a smart contract operation on Ethereum, paid in ETH. It rises when the network is busy.
- Explained in: Ethereum and smart contracts, Gas and fees
- Related terms: Smart contract
- Golden cross
- When a faster moving average (often SMA 50) crosses a slower one (SMA 200) from below; the opposite is a death cross. Popular, but it comes late.
- Explained in: SMA: the simple moving average, Moving averages
- Related terms: Moving average
- Gwei
- A small unit of ETH: one gwei is a billionth of an ETH (0.000000001 ETH). Gas prices are quoted in it.
- Explained in: Gas and fees
- Related terms: Gas, Base fee
H
- Halving
- The halving of the reward for a new Bitcoin block, roughly every four years. It slows down how fast new bitcoins are created.
- Explained in: Bitcoin
- Related terms: Mining, Satoshi
- Hard fork
- A change to a blockchain's rules that older software does not accept. If part of the network refuses to upgrade, the chain splits in two – as Ethereum and Ethereum Classic did in 2016.
- Explained in: The DAO hack: the bug that split Ethereum in two
- Related terms: Blockchain, Smart contract
- Hardware wallet
- A small device that keeps private keys inside and signs transactions itself, so the keys never touch an internet-connected computer. You confirm every transaction on its screen.
- Explained in: Types of wallets
- Related terms: Cold wallet, Secure element, Seed phrase
- Hash
- A short fingerprint of any data, calculated by a fixed formula. The smallest change in the data gives a completely different hash.
- Explained in: What is a blockchain
- Related terms: Blockchain, Proof of work
- Honeypot token
- A scam token whose smart contract lets people buy but blocks or heavily taxes selling. The price can only go up on the chart until the creators take the money.
- Explained in: Squid Game token: the coin you could buy but not sell
- Related terms: Rug pull, Smart contract
- Hot wallet
- A wallet connected to the internet – a mobile app, a browser extension or an account at an exchange. Convenient, but more exposed to hackers.
- Explained in: Wallets
- Related terms: Cold wallet, Wallet
K
- KDJ
- A variant of the stochastic oscillator: K and D are the smoothed lines and J = 3K − 2D runs ahead of them and can leave the 0–100 range.
- Explained in: Stochastic and KDJ
- Related terms: Stochastic oscillator, Oscillator
- Kelly criterion
- A formula for the share of capital to risk per trade that maximises long-term growth: f = p − (1 − p) ÷ b, where p is the win rate and b the ratio of average win to average loss. In practice only a fraction of it is used, because full Kelly brings huge drawdowns.
- Explained in: How much to risk: the Kelly criterion
- Related terms: Expected value, Risk of ruin, R-multiple
- KYC (know your customer)
- Identity verification that regulated exchanges must do before you can trade – usually an ID document and a selfie.
- Explained in: Choosing an exchange, Binance and CZ: the $4.3 billion guilty plea, Signing up and verifying your identity
- Related terms: Exchange
L
- Layer 2 (L2)
- A network built on top of a blockchain such as Ethereum: it processes transactions itself and relies on the main network for security. Rollups are the most common kind.
- Explained in: Rollups: how layer 2 networks work
- Related terms: Rollup, Bridge
- Leverage
- Trading with borrowed money. It magnifies both profits and losses – with 10× leverage, a 10% move against you wipes out the whole deposit.
- Explained in: Managing risk, Buttons to leave alone for now
- Related terms: Stop-loss
- Limit order
- An order to buy or sell only at your price or better. It waits in the order book and may never be filled.
- Explained in: How an exchange works, Order types in depth
- Related terms: Market order, Order book
- Liquid staking
- Staking through a pool that gives you a tradable staking token in return. It adds liquidity but also contract risk and the risk of selling at a discount.
- Explained in: Staking ETH, Liquid staking and its risks
- Related terms: Staking, Stake account, DeFi
- Liquidation
- The exchange automatically closes a leveraged position when the loss eats almost all of its margin. With 10× leverage a move of roughly 9–10% against you is enough.
- Explained in: Buttons to leave alone for now, Spot vs futures: leverage, liquidation, funding
- Related terms: Margin, Leverage, Futures
- Liquidity
- How easily you can buy or sell without moving the price. A liquid market has many orders near the price and a small spread.
- Explained in: SafeMoon: the 'safe' token whose CEO went to prison, Pump and dump: $LIBRA, $HAWK and celebrity memecoins, Maker and taker fees
- Related terms: Spread, Order book, Slippage
- Loss aversion
- A loss hurts roughly twice as much as an equal gain pleases (Kahneman and Tversky). In trading it leads to taking profits too early and holding losses too long.
- Explained in: Emotions: FOMO, fear and revenge trading
- Related terms: FOMO, Confirmation bias
M
- MACD
- Moving Average Convergence Divergence – the difference between two exponential averages, plotted with its signal line below the chart. It shows the strength and turning of a trend.
- Explained in: The indicator menu: what to turn on and what not, MACD: two trains and the gap between them, A clean setup, When indicators disagree
- Related terms: Moving average, RSI
- Maker and taker
- A taker takes an offer already in the order book (a market order) and pays a higher fee; a maker adds a waiting offer (a limit order) and pays a lower one.
- Explained in: What a trade costs
- Related terms: Order book, Limit order, Market order
- Margin
- The deposit that backs a leveraged position. If losses eat it up, the position is liquidated.
- Explained in: Spot vs futures: leverage, liquidation, funding
- Related terms: Leverage, Liquidation
- Market depth
- How many buy and sell orders are waiting in the order book at each price. A depth chart shows it as two mountains, green for buys and red for sells.
- Explained in: The order book and market depth
- Related terms: Order book, Liquidity
- Market order
- An order to buy or sell immediately at the best available price. It is filled at once, but the price can be worse than you expected.
- Explained in: How an exchange works, Order types in depth
- Related terms: Limit order, Slippage, Spread
- Market regime
- The state of the market described by direction (trend or range) and volatility (calm or wild). Each regime favours a different type of strategy.
- Explained in: When indicators disagree, Market regimes and volatility
- Related terms: ATR (Average True Range), Trend
- Market structure
- The order of the clear highs and lows on a chart. Higher highs and lows mean a rising structure, lower highs and lows a falling one.
- Explained in: Trend and market structure
- Related terms: Break of structure, Trend, Support
- Mean reversion
- A type of strategy betting that a price far from its average will return to it. High win rate, small profits and an occasional big loss; suffers in trends and crashes.
- Explained in: When indicators disagree, Types of strategies
- Related terms: Trend following, Market regime
- Memecoin
- A coin built on a joke or an internet meme, usually without any practical use. Its price moves on hype and it is extremely risky.
- Explained in: Stablecoins, altcoins and memecoins, Pump and dump: $LIBRA, $HAWK and celebrity memecoins
- Related terms: Altcoin
- Mempool
- The waiting room of transactions that have been sent but are not yet in a block. Transactions with a higher fee usually get into a block sooner.
- Explained in: How a transaction works
- Related terms: Confirmation, Blockchain
- MEV
- Maximal extractable value – profit that can be made from the order of transactions in a block, for example through tips for priority or sandwich attacks.
- Explained in: Native staking
- Related terms: Sandwich attack, Validator, Priority fee
- MFI
- Money Flow Index: an RSI that counts money (typical price × volume) instead of price changes, 0–100.
- Explained in: MFI: an RSI with a wallet
- Related terms: RSI, Volume
- MiCA
- The EU regulation on markets in crypto-assets. Crypto-asset service providers need a licence and must follow rules for protecting customers – but it does not protect you from falling prices.
- Explained in: Choosing an exchange, Thodex and Africrypt: crypto founders who vanished, Tether (USDT) controversy: is it really backed?, Binance and CZ: the $4.3 billion guilty plea, Fake crypto exchanges and apps: how to spot a clone, Crypto scam red flags: 12 warning signs, Choosing a licensed exchange
- Related terms: Exchange, DAC8
- Mining
- Creating new blocks in a proof-of-work network. Miners spend computing power and electricity and receive newly created coins and fees as a reward.
- Explained in: Mining and staking
- Related terms: Proof of work, Halving
- Mixer
- A service that pools coins from many users and sends them back out to hide where each coin came from. Criminals use mixers to launder stolen crypto, and some have been sanctioned or shut down.
- Explained in: Bitfinex hack: 120,000 BTC and the rapper who hid them
- Related terms: Blockchain, KYC (know your customer)
- MLM (multi-level marketing)
- A sales model in which people earn commissions for recruiting others, who recruit others in turn. In crypto scams it spreads a fake product fast, and the rewards for recruiting matter more than the product itself.
- Explained in: BitConnect: the 1 % a day Ponzi scheme explained, OneCoin: the $4 billion crypto with no blockchain
- Related terms: Ponzi scheme
- Moving average
- A line showing the average closing price over the last N periods, e.g. SMA 50. SMA weighs all days equally, EMA weighs recent days more. It smooths the noise but always lags.
- Explained in: The indicator menu: what to turn on and what not, What an indicator is, SMA: the simple moving average, Volume: VOL, Moving averages
- Related terms: Golden cross, Trend
- Multisig
- A wallet that needs signatures from several separate keys – for example two of three – to send money. It removes a single point of failure but adds complexity.
- Explained in: Split backups and multisig, Bybit and Ronin hacks: North Korea's billion-dollar heists, Smart wallets and new upgrades
- Related terms: Split backup (SLIP-39), Private key
N
- Nakamoto coefficient
- The smallest number of validators or miners that together could halt or control a network. The lower it is, the more concentrated the network.
- Explained in: Outages and decentralisation
- Related terms: Validator, Decentralization
- NFT
- A non-fungible token – a token that exists as a single unique piece, such as a digital picture or a ticket. Unsolicited NFTs in a wallet are often scam bait.
- Explained in: SPL tokens and NFTs
- Related terms: Token, Phishing
- Node
- A computer running the network's software. It keeps a copy of the blockchain and checks that new transactions and blocks follow the rules.
- Explained in: What is a blockchain
- Related terms: Blockchain, Decentralization
O
- OBV
- On-balance volume: a running total that adds the volume of candles closing higher and subtracts it on candles closing lower.
- Explained in: OBV: a piggy bank for volume
- Related terms: Volume
- OCO (one cancels the other)
- Two linked orders, typically a take-profit and a stop-loss: when one fills, the other is cancelled automatically.
- Explained in: Order types in depth
- Related terms: Take-profit, Stop-loss
- Open interest
- The number of open futures contracts – how much leveraged money is in the market. Read together with the price.
- Explained in: Derivatives data as information
- Related terms: Funding, Futures, Liquidation
- Order book
- The list of all buy and sell limit orders waiting at an exchange, sorted by price.
- Explained in: How an exchange works, A tour of the trading screen
- Related terms: Limit order, Spread
- Oscillator
- An indicator that swings within a range (often 0–100) in its own panel below the chart – it shows the speed of a move, not the price.
- Explained in: Three families of indicators
- Related terms: RSI, Overbought
- Out-of-sample
- Data set aside before testing and used only once for the final test – it shows how a strategy does on data it was not tuned on.
- Explained in: Out-of-sample testing and walk-forward
- Related terms: Walk-forward, Overfitting, Backtest
- Overbought
- An RSI above 70: rises have strongly dominated recently. In a strong trend the market can stay overbought for weeks.
- Explained in: RSI and momentum
- Related terms: RSI
- Overfitting
- Tuning a strategy to past data until it fits random details that will not repeat. It looks great in a backtest and fails in real trading.
- Explained in: Why indicators mislead
- Related terms: Moving average, RSI
P
- Parabolic SAR
- Stop and reverse: dots below the price in an uptrend and above it in a downtrend that move closer every candle. When the price crosses them, they jump to the other side.
- Explained in: Parabolic SAR: dots that chase the price
- Related terms: Trailing stop, Trend
- Passkey
- A modern way to sign in without a password, stored on your phone or computer and confirmed with your fingerprint or face. It cannot be phished on a fake website.
- Explained in: Smart wallets and new upgrades, Securing your exchange account
- Related terms: Two-factor authentication (2FA), Phishing
- Passphrase
- An optional password added to a seed phrase that creates a completely different wallet. It protects against someone who finds your backup, but nobody can recover it if you forget it.
- Explained in: Passphrase (the "25th word")
- Related terms: Seed phrase, BIP39
- Phishing
- A fake e-mail, message or website pretending to be someone you trust, made to steal your password, codes or seed phrase.
- Explained in: Account security
- Related terms: Two-factor authentication (2FA), Seed phrase
- Pig butchering
- A long con in which a stranger builds a friendship or romance over weeks, then steers you to a fake crypto trading platform and keeps everything you deposit. The name comes from the Chinese for fattening a pig before slaughter.
- Explained in: Pig butchering: the 'wrong number' crypto scam
- Related terms: Social engineering, Exchange
- Ponzi scheme
- A fraud that pays earlier investors their "returns" out of money from newer investors instead of from real profit. It collapses as soon as new money stops coming in.
- Explained in: QuadrigaCX: the CEO who died with the only keys, BitConnect: the 1 % a day Ponzi scheme explained, OneCoin: the $4 billion crypto with no blockchain
- Related terms: MLM (multi-level marketing), Rug pull
- Priority fee
- An optional extra fee on Solana: compute units multiplied by an offered price per unit. It buys priority in a block, not a better price.
- Explained in: Gas and fees, Fees and priority fees
- Related terms: Slippage, Validator
- Private key
- A secret number that proves you own your coins and signs your transactions. Whoever has it controls the coins.
- Explained in: How a transaction works, Keys, seed phrase and address
- Related terms: Seed phrase, Wallet
- Profit factor
- The sum of all profits divided by the sum of all losses. Above 1 a strategy is in profit – but with few trades even a high profit factor can be luck.
- Explained in: Strategy metrics
- Related terms: Expected value, Drawdown
- Proof of History
- Solana's cryptographic clock: a continuous chain of hashes that proves time has passed and gives transactions an order. It does not decide validity – proof of stake does.
- Explained in: Validators, proof of stake and Proof of History
- Related terms: Proof of stake, Validator, Hash
- Proof of reserves
- A check, often by an outside auditor, showing that an exchange really holds the coins its customers have on their accounts. It does not show its debts, so it is useful but not a full guarantee.
- Explained in: Mt. Gox: the hack that lost 850,000 bitcoins, FTX collapse: how 8 billion dollars vanished
- Related terms: Exchange, Self-custody
- Proof of stake
- A way of agreeing on new blocks in which validators lock (stake) their own coins as a guarantee. It uses far less electricity than proof of work; Ethereum has used it since 2022.
- Explained in: Mining and staking, Proof of stake and The Merge, Validators, proof of stake and Proof of History
- Related terms: Staking, Proof of work
- Proof of work
- A way of agreeing on new blocks in which miners compete to solve a computing puzzle. Rewriting history would cost an enormous amount of electricity; Bitcoin uses it.
- Explained in: Mining and staking
- Related terms: Mining, Proof of stake, Hash
- Pump and dump
- A scheme in which insiders buy a cheap, thinly traded token, hype it to push the price up and then sell to the late buyers, after which the price collapses.
- Explained in: Pump and dump: $LIBRA, $HAWK and celebrity memecoins
- Related terms: Memecoin, Rug pull, FOMO
R
- R-multiple
- A trade result expressed as a multiple of the amount risked (1R). A loss at the stop-loss is −1R, a profit twice the risk is +2R.
- Explained in: Reviewing your own performance, Position size and R-multiples
- Related terms: Stop-loss, Expected value
- Recovery scam
- A follow-up scam aimed at people who have already lost money: fake lawyers, investigators or officials promise to recover the stolen funds in exchange for an upfront fee or access to the victim's wallet.
- Explained in: Scammed in crypto? What to do now, step by step
- Related terms: Phishing, Sunk cost fallacy
- Reentrancy
- A smart contract bug where the contract sends money before updating the balance, so an attacker can call it again and withdraw repeatedly. It drained The DAO in 2016.
- Explained in: The DAO hack: the bug that split Ethereum in two
- Related terms: Smart contract, DeFi
- Repainting
- When an indicator's past values change after new candles arrive. On a closed candle a standard indicator no longer changes; on the unfinished last candle every indicator still moves.
- Explained in: What an indicator is
- Related terms: Candlestick
- Resistance
- A price level where rising prices stopped in the past because sellers outnumbered buyers. It can be broken at any time.
- Explained in: Reading a candlestick chart, Support and resistance in depth
- Related terms: Support, Trend
- Restaking
- Using already staked ETH as a deposit for other services too, for an extra reward. Every added service adds a risk of losing part of the deposit.
- Explained in: Restaking and its risks
- Related terms: Staking, Liquid staking, Slashing
- Revenge trading
- Trading to win back a loss right away, usually with a bigger position and without a plan. It turns one loss into several.
- Explained in: Emotions: FOMO, fear and revenge trading
- Related terms: FOMO, Trading plan
- Risk of ruin
- The chance that a series of losses wipes out an account or shrinks it so much that you have to stop trading. It grows quickly with the size of the risk per trade.
- Explained in: How much to risk: the Kelly criterion
- Related terms: Kelly criterion, Drawdown
- Role reversal
- When a broken resistance starts acting as support, or a broken support as resistance.
- Explained in: Support and resistance in depth
- Related terms: Support, Resistance
- Rollup
- A layer 2 network that bundles transactions and posts their data and result to Ethereum. Optimistic rollups allow challenges for about 7 days; ZK rollups post a validity proof.
- Explained in: Rollups: how layer 2 networks work
- Related terms: Layer 2 (L2), Sequencer, Blob
- RSI
- Relative Strength Index: compares recent rises and falls on a 0–100 scale. Above 70 means overbought, below 30 oversold – which is not a signal to sell or buy.
- Explained in: The indicator menu: what to turn on and what not, RSI: the market's thermometer, MFI: an RSI with a wallet, A clean setup, Divergence, RSI and momentum
- Related terms: Overbought, Moving average
- Rug pull
- A scam in which a token's creators abandon it and take the money – by selling everything, removing liquidity, minting more tokens or freezing buyers.
- Explained in: SafeMoon: the 'safe' token whose CEO went to prison, Squid Game token: the coin you could buy but not sell, Pump and dump: $LIBRA, $HAWK and celebrity memecoins, Memecoins and launchpads
- Related terms: Memecoin, Mint authority, Freeze authority
S
- Sandwich attack
- A bot buys just before your swap and sells right after it, so you pay a worse price up to your slippage limit and the bot keeps the difference.
- Explained in: Swaps and aggregators
- Related terms: Slippage, MEV, DEX
- Satoshi
- The smallest unit of Bitcoin: one hundred-millionth of a bitcoin (0.00000001 BTC). Named after Bitcoin's creator.
- Explained in: Bitcoin
- Related terms: Halving
- Secure element
- A chip designed to keep secrets such as private keys even against physical attacks in a lab. Many newer hardware wallets use one.
- Explained in: How a hardware wallet works
- Related terms: Hardware wallet, Firmware
- Seed phrase
- 12 or 24 words from which a wallet can restore all its keys. Anyone who has them owns your coins – never type them into a website or give them to anyone.
- Explained in: Wallets, Keys, seed phrase and address, Scammed in crypto? What to do now, step by step
- Related terms: Private key, Cold wallet, Phishing
- Self-custody
- Holding the keys to your crypto yourself, in your own wallet, instead of leaving them with an exchange. Nobody can easily freeze your coins (though issuers of some tokens, such as stablecoins, can) – but nobody can recover them if you lose the keys.
- Explained in: Exchange or your own wallet?, Mt. Gox: the hack that lost 850,000 bitcoins
- Related terms: Private key, Seed phrase, Hardware wallet
- SEPA
- The euro payment system for bank transfers within Europe. A SEPA transfer to an exchange is usually the cheapest way to deposit euros; an instant SEPA payment arrives within seconds.
- Explained in: Depositing money and what it costs
- Related terms: Exchange, KYC (know your customer)
- Sequencer
- The server that orders transactions on a rollup. On the big rollups it is a single server run by the operator – when it fails, the rollup stops.
- Explained in: Rollups: how layer 2 networks work
- Related terms: Rollup, Layer 2 (L2)
- SIM swap
- An attack in which a criminal gets your phone number moved to their SIM card and then receives your text-message codes. Use an app or security key for 2FA instead of SMS.
- Explained in: Attacks on wallets
- Related terms: Two-factor authentication (2FA), Phishing
- Slashing
- A penalty for a validator that cheats or signs conflicting messages, for example two blocks for the same slot. It loses part of its deposit and is removed from the network.
- Explained in: Proof of stake and The Merge
- Related terms: Validator, Staking
- Slippage
- The difference between the price you expected and the price the trade was actually filled at. It is largest with market orders in fast or thin markets.
- Explained in: How an exchange works, Orders in practice, The order book and market depth, What a trade costs
- Related terms: Market order, Spread
- Smart account
- A wallet controlled by code rather than a single key. It can require several signatures, set limits, recover access without a seed phrase or let an app pay the fees.
- Explained in: Smart wallets and new upgrades
- Related terms: Multisig, Passkey
- Smart contract
- A program stored on a blockchain that runs automatically when its conditions are met. Nobody can quietly change it – unless its authors built in a way to pause or upgrade it, which is a risk in itself.
- Explained in: Ethereum and smart contracts, SafeMoon: the 'safe' token whose CEO went to prison, Squid Game token: the coin you could buy but not sell, The DAO hack: the bug that split Ethereum in two, Poly Network hack: the thief who gave back 610 million, The world computer, Why Solana was created
- Related terms: Gas, DeFi
- SPL token
- The token standard on Solana. Each token is defined by a mint account that records its supply, decimals and who may mint more or freeze accounts.
- Explained in: SPL tokens and NFTs
- Related terms: Mint authority, Freeze authority, Token account
- Split backup (SLIP-39)
- A backup that splits a wallet's secret into several shares, for example three, any two of which can restore it. One share alone reveals nothing. It works only in wallets that support it.
- Explained in: Split backups and multisig
- Related terms: Seed phrase, Multisig
- Spread
- The difference between the best buy price and the best sell price at a given moment. It is a hidden cost of every trade.
- Explained in: How an exchange works, Quick buy or spot?, The order book and market depth, What a trade costs
- Related terms: Order book, Slippage
- Stablecoin
- A token whose value is tied to a traditional currency, usually the US dollar (for example USDT or USDC). It can lose its peg if its reserves fail.
- Explained in: Stablecoins, altcoins and memecoins, Poly Network hack: the thief who gave back 610 million, Tether (USDT) controversy: is it really backed?, Scammed in crypto? What to do now, step by step
- Related terms: Token, DeFi
- Stablecoin attestation
- A report by an accounting firm confirming that a stablecoin issuer held the listed reserves on one specific day. It is a snapshot, not a full audit of the whole year.
- Explained in: Tether (USDT) controversy: is it really backed?
- Related terms: Stablecoin
- Stake account
- On Solana, an account holding SOL delegated to a validator. The SOL stays under your control; the validator only gains its voting weight.
- Explained in: Native staking
- Related terms: Staking, Validator, Epoch
- Staking
- Locking your coins to help secure a proof-of-stake network in exchange for a reward. In an app or at an exchange you usually hand them to a validator or the platform, which stakes them for you. The coins may be locked for some time and their price can still fall.
- Explained in: Mining and staking
- Related terms: Proof of stake
- Stochastic oscillator
- Shows where the close sits in the high–low range of the last N candles, 0–100. Above 80 the close is near the top of the range, below 20 near the bottom.
- Explained in: Stochastic and KDJ
- Related terms: Oscillator, KDJ
- Stochastic RSI
- The stochastic oscillator applied to RSI instead of the price: where RSI sits in its own recent range. Very sensitive – it swings much more than RSI.
- Explained in: Stochastic RSI: RSI on caffeine
- Related terms: RSI, Stochastic oscillator
- Stop-limit order
- An order that, once a trigger price is reached, places a limit order at your limit price. You know the worst price, but if the market jumps past the limit, it does not fill at all.
- Explained in: Order types in depth
- Related terms: Stop-loss, Limit order
- Stop-loss
- An order that automatically sells your position when the price falls to a level you chose in advance. It limits the loss, but in a fast market it can be filled at a worse price.
- Explained in: Managing risk, Order types in depth
- Related terms: Take-profit, Slippage, Leverage
- Sunk cost fallacy
- Continuing to put money or effort into something only because of what has already been spent, instead of judging what happens next. Scammers exploit it with "just one more fee".
- Explained in: Why smart people fall for crypto scams, Scammed in crypto? What to do now, step by step
- Related terms: Loss aversion, Recovery scam
- Supertrend
- A trend line set a multiple of ATR below the price in a rise (or above it in a fall). It only moves with the trend and flips when the close crosses it.
- Explained in: Supertrend and ATR
- Related terms: ATR (Average True Range), Trend, Trailing stop
- Support
- A price level where falling prices stopped in the past because buyers outnumbered sellers. It can be broken at any time.
- Explained in: Reading a candlestick chart, Support and resistance in depth
- Related terms: Resistance, Stop-loss
- Survivorship bias
- Testing only on what survived – such as today's top coins – while the failures (like LUNA) are missing. It makes results look better than reality.
- Explained in: The backtest and its traps
- Related terms: Backtest, Overfitting
T
- Take-profit
- An order that closes your position automatically when the price reaches your profit target.
- Explained in: Managing risk
- Related terms: Stop-loss
- The Merge
- Ethereum's switch from mining (proof of work) to proof of stake on 15 September 2022. Electricity use fell by about 99.95%.
- Explained in: Proof of stake and The Merge
- Related terms: Proof of stake, Proof of work
- Timeframe
- The period one candle on a chart covers – a minute, an hour, a day or a week. Longer timeframes show less noise.
- Explained in: Reading a candlestick chart, Timeframes and chart abbreviations, Multiple timeframes
- Related terms: Candlestick, Trend
- Token
- A unit of value created on an existing blockchain, such as Ethereum. Unlike a coin, it has no blockchain of its own.
- Explained in: Ethereum and smart contracts, FTX collapse: how 8 billion dollars vanished
- Related terms: Stablecoin, Smart contract
- Token account
- On Solana, a separate account that holds one kind of token for one owner. It is created when you first receive a token and requires a small refundable deposit.
- Explained in: Wallet and accounts
- Related terms: Account rent, SPL token, Wallet
- Token approval
- Permission for a smart contract to spend some or all of your tokens of one kind. An unlimited approval lasts until you revoke it.
- Explained in: Scammed in crypto? What to do now, step by step, Tokens, NFTs and approvals
- Related terms: ERC-20, Wallet drainer
- Token inflation
- The creation of new coins of a cryptocurrency over time, usually as rewards for validators and stakers. Holders who do not stake see their share of all coins shrink.
- Explained in: The SOL token: inflation, fee burning and staking
- Related terms: Staking, Validator
- Trading journal
- A record of every trade: why it was made, entry, stop, result in R, whether the plan was followed and how you felt. Reviewed regularly.
- Explained in: A trading journal and review
- Related terms: Trading plan
- Trading pair
- Two currencies traded against each other, such as BTC/EUR. The first is what you buy, the second what you pay with; the price says how much of the second one unit of the first costs.
- Explained in: A tour of the trading screen
- Related terms: Order book, Exchange
- Trading plan
- Written rules decided in advance: markets, the situation you trade, entry, stop-loss, exit, position size, loss limits and review.
- Explained in: A clean setup, A trading plan step by step
- Related terms: Trading journal, R-multiple
- Trading rules
- An exact description of a strategy: what, on which timeframe, entry, exit, stop-loss, position size and costs – so precise that two people would make the same trades.
- Explained in: From idea to rules
- Related terms: Trading plan, Backtest
- Trailing stop
- A stop-loss set as a distance from the highest price (e.g. 5%). It moves up as the price rises and stays put when it falls.
- Explained in: Parabolic SAR: dots that chase the price, Order types in depth
- Related terms: Stop-loss
- Trend
- The direction in which the price moves over a longer period. In an uptrend each high and low is higher than the previous one; a trend can end at any time.
- Explained in: Reading a candlestick chart, When indicators disagree
- Related terms: Support, Resistance, Timeframe
- Trend following
- A type of strategy that holds a position while a trend lasts. Low win rate, a few big profits pay for many small losses; suffers in a range.
- Explained in: When indicators disagree, Types of strategies
- Related terms: Mean reversion, Market regime
- Two-factor authentication (2FA)
- A second proof of identity on top of your password – usually a code from an authenticator app or a security key. Codes sent by SMS are the weakest option.
- Explained in: Account security
- Related terms: Phishing
V
- Validator
- A computer that verifies transactions and writes blocks in a proof-of-stake network. On Solana it needs a powerful server, and its voting weight depends on the SOL staked with it.
- Explained in: Bybit and Ronin hacks: North Korea's billion-dollar heists, Proof of stake and The Merge, Why Solana was created
- Related terms: Proof of stake, Staking, Epoch
- Volatility-based position sizing
- Setting the stop-loss in ATR and sizing the position from it: smaller in a wild market, bigger in a calm one, with the same risk in money.
- Explained in: Volatility-based entries and exits
- Related terms: ATR (Average True Range), Stop-loss
- Volume
- The amount traded in a period – for BTC/USDT the number of bitcoins. High volume confirms a move but does not tell its direction.
- Explained in: The indicator menu: what to turn on and what not, VWAP: the volume-weighted average price, Volume: VOL, MFI: an RSI with a wallet, Volume: confirming the move
- Related terms: Break of structure, Support
- VWAP
- Volume-weighted average price: the average price of the day's trades, where big trades count more. It usually starts again every day.
- Explained in: VWAP: the volume-weighted average price
- Related terms: Volume, Moving average
W
- Walk-forward
- A test that repeatedly picks parameters from the past and trades them on the next period – the way a real trader would.
- Explained in: Out-of-sample testing and walk-forward
- Related terms: Out-of-sample, Backtest
- Wallet
- An app or device that keeps your keys. The coins themselves stay on the blockchain – the wallet only gives you access to them.
- Explained in: Wallets
- Related terms: Private key, Hot wallet, Cold wallet
- Wallet drainer
- Malicious code behind a fake website that tricks you into signing a transaction which moves everything valuable out of your wallet at once.
- Explained in: Crypto giveaway scams: the 2020 Twitter hack and deepfakes, Scammed in crypto? What to do now, step by step, Security: drainers, signing and fake airdrops
- Related terms: Phishing, Airdrop, Wallet
- Williams %R
- The stochastic oscillator turned upside down: 0 when the close is at the high of the last N candles, −100 at the low.
- Explained in: Williams %R: the stochastic upside down
- Related terms: Stochastic oscillator, Oscillator
- Withdrawal whitelist
- A list of addresses you have approved in advance; the exchange then lets you withdraw crypto only to them. A new address usually works only after a waiting period.
- Explained in: Securing your exchange account
- Related terms: Two-factor authentication (2FA), Exchange
- WMA
- Weighted moving average: the newest close weighs N times, the oldest once. It sits between a simple average and an EMA in speed.
- Explained in: EMA and WMA: averages that favour the news
- Related terms: Moving average, EMA
- Wrench attack
- Physical violence or threats used to force a crypto holder to hand over their coins. The best defence is staying low-key about what you own.
- Explained in: Attacks on wallets
- Related terms: Self-custody, Multisig