Crypto Glossary for Indian Investors

A shared digital ledger that records transactions in a chain of blocks that cannot be altered.

DeFi

Decentralized Finance - financial services like lending, borrowing and trading run by code instead of banks.

RWA (Real World Assets)

Tokenization of physical assets like gold, real estate, or bonds on a blockchain.

TVL (Total Value Locked)

The total amount of crypto assets deposited into a DeFi protocol, used as a measure of its size and popularity.

APR (Annual Percentage Rate)

DeFi Beginner

The yearly interest rate you earn or pay on a crypto investment, not including compounding effects.

APY (Annual Percentage Yield)

DeFi Beginner

The yearly return on a crypto investment including the effect of compounding interest.

Slippage

Trading Intermediate

The difference between the price you expect to pay for a crypto trade and the actual price you receive.

MEV (Maximal Extractable Value)

Infrastructure Advanced

Profit that block validators can extract by reordering, inserting, or censoring transactions within a block.

Infrastructure Intermediate

Layer-2

A secondary network built on top of a main blockchain to make transactions faster and cheaper.

Smart Contract

A self-executing program stored on a blockchain that automatically carries out an agreement when conditions are met.

Infrastructure Intermediate

Proof of Work

A consensus mechanism where miners solve complex math puzzles using computer power to validate transactions and earn rewards.

Infrastructure Intermediate

Proof of Stake

A consensus mechanism where validators lock up crypto as collateral to earn the right to confirm transactions and earn rewards.

DCA (Dollar-Cost Averaging)

An investment strategy of buying a fixed amount of crypto at regular intervals regardless of the price.

HODL

A long-term crypto holding strategy where investors keep their assets instead of selling during price drops.

NFT (Non-Fungible Token)

A unique digital token on a blockchain that proves ownership of a specific digital item like art, music, or collectibles.

Web3

The next evolution of the internet built on blockchain technology, where users own their data and digital assets.

Crypto Wallet

Software or hardware that stores your private keys and lets you send, receive, and manage your cryptocurrency.

Gas Fees

The fee you pay to blockchain validators to process your transaction on the Ethereum network.

Liquidity Pool

A pool of crypto tokens locked in a smart contract that enables instant trading on a decentralized exchange without needing buyers and sellers to match.

Stablecoin

A cryptocurrency designed to maintain a stable value by being pegged to a fiat currency like the US dollar.

Altcoin

Any cryptocurrency other than Bitcoin - including Ethereum, Solana, Cardano, and thousands of others.

Market Cap

The total value of all coins in circulation for a cryptocurrency, calculated by multiplying price by total supply.

DAO (Decentralized Autonomous Organization)

An organization governed by smart contracts and community token holders instead of a traditional management hierarchy.

AMM (Automated Market Maker)

A smart contract algorithm that automatically sets token prices and enables trading without needing a traditional order book.

Yield Farming

DeFi Advanced

A DeFi strategy where users move crypto between different protocols to maximize returns and token rewards.

Bull Market

Trading Beginner

A period of sustained rising crypto prices, generally defined as a 20% or more increase from a recent low.

Bear Market

Trading Beginner

A prolonged period of falling crypto prices, typically defined as a 20% or more decline from a recent peak.

Halving

Investing Intermediate

A programmed event in Bitcoin where the reward for mining a new block is cut in half, reducing the rate of new Bitcoin supply.

Whitepaper

An official document published by a crypto project that explains its technology, purpose, tokenomics, and roadmap.

Cold Wallet

A crypto wallet that stores your private keys offline, disconnected from the internet, for maximum security.