Web 3 can be confusing. Here are some common terms used in Web 3 that will help you understand the space:
Apeing - When a cryptocurrency trader buys a token shortly after the token project launch without conducting thorough research.
Blockchain - A blockchain is a distributed database that is shared among the nodes of a computer network. The basis for cryptocurrencies.
Byzantine Generals' Problem - A term taken from computer science that describes a situation where involved parties must agree on a single strategy in order to avoid complete failure, but where some of the involved parties are corrupt and disseminating false information or are otherwise unreliable.
Cold Wallet - A cryptocurrency wallet that is in cold storage, i.e. not connected to the internet.
Consensus Mechanism - A consensus mechanism is an underlying technology behind the main functionalities of all blockchain technology, which makes them an essential operating feature of all cryptocurrencies. Consensus mechanisms outline the conditions that need to be met by nodes and validators so that new blocks can be added to the blockchain.
Cryptocurrency - Digital currencies that use cryptographic technologies to secure their operation.
Cryptographic Hash Function - Cryptographic hash functions produce a fixed-size hash value from a variable-size transaction input.
Decentralized - The property of a system in which nodes or actors work in concert in a distributed fashion to achieve a common goal.
Decentralized Applications (DApps) - Applications that run on a decentralized network, avoiding a single point of failure.
Decentralized Autonomous Organizations (DAOs) - An entity that lives on the internet and exists autonomously but heavily relies on hiring individuals to perform certain tasks that the automation itself cannot do. DAOs are governed by a set of computer-defined rules and blockchain-based smart contracts.
Defi - DeFi is short for “decentralized finance,” an umbrella term for a variety of financial applications in cryptocurrency or blockchain geared toward disrupting financial intermediaries.
DEGEN - degenerate, a gambler, someone really shooting at all chances, taking extremely high risks. Refers to people who invest in digital assets like NFTs or cryptos without doing due diligence.
Diamond Hands - A popular term on social media platforms. It refers to people who hold their coins even if their portfolio drops in value by more than 20%.
DYOR - The acronym of Do Your Own Research — encourages investors to complete due diligence on a project before investing.
Fiat Currency- A "legal tender" backed by a central government, such as the Federal Reserve, and with its own banking system, such as fractional reserve banking. It can take the form of physical cash, or it can be represented electronically, such as with bank credit.
Floor Price - The lowest available asking price in a marketplace either for a collection as a whole or for a subset of the collection.
FOMO - An acronym that stands for "Fear of Missing Out."
Fren - Friend
Fungible - In cryptocurrency, fungibility is when a coin or token can be replaced by any other identical coin or token.
Gas - A term used on the Ethereum platform refers to a unit measuring the computational effort of conducting transactions or smart contracts or launching DApps in the Ethereum network. It is the "fuel" of the Ethereum network.
GM - Good morning
GMI - Gonna Make It
GN - Good night
Governance Token - A governance token is a token that can be used to vote on decisions that influence an ecosystem.
Hardware Wallet - A hardware wallet is a wallet for cryptocurrencies that usually resemble a USB stick.
HODL - A type of passive investment strategy where you hold an investment for an extended period of time, regardless of any changes in the price or markets. The term first became famous due to a typo made in a Bitcoin forum, and the term is now commonly expanded to stand for "Hold On for Dear Life."
Hot Wallet - A cryptocurrency wallet that is connected to the internet for hot storage of cryptoassets, as opposed to an offline, cold wallet with cold storage.
Immutable - A property that defines the inability to be changed, especially over time.
Interoperability - Blockchain interoperability, or cross-chain interoperability, is the ability to see and share information across multiple blockchains.
IRL - In real life
Laser Eyes - A viral Twitter meme that is used by Bitcoiners who attempt to push the price of BTC to its new all-time highs. It originated with a hashtag, #LaserRayUntil100, back in February 2021.
Merkle Tree - Merkle tree also known as hash tree is a data structure used for data verification and synchronization. It is a tree data structure where each non-leaf node is a hash of its child nodes. All the leaf nodes are at the same depth and are as far left as possible. Hash trees allow efficient and secure verification of the contents of blockchains, as each change propagates upwards, so verification can be done by simply looking at the top hash.
Metaverse - A digital universe that contains all the aspects of the real world, such as real-time interactions and economies. The term was initially coined by author Neal Stephenson in the 1992 novel Snow Crash.
Metcalfe's Law: Metcalfe's Law describes the use of networks and highlights that the more users a network has, the more valuable it is to each user.
Mimetic Theory - Mimetic theory explains human behaviour and culture, and when understood contextually in economics, it deals with how things become desirable to individuals.
Miners - Contributors to a blockchain taking part in the process of mining. They can be professional miners or organizations with large-scale operations or hobbyists who set up mining rigs at home or in the office.
Mining - A process where blocks are added to a blockchain, verifying transactions. It is also how new bitcoins or some altcoins are created.
Minting - The process of turning a digital file into a crypto collectible or digital asset.
Moon - A situation where there is a continuous upward movement in the price of a cryptocurrency. Often used in communities to question when a cryptocurrency experiences such a phenomenon, saying, "When moon?" It is usually combined with "When Lambo?"
Multi-Signature (Multi-Sig) - An added layer of security by requiring more than one key to authorize a transaction. Multisignature crypto wallets require more than a single signature to sign a transaction.
Newb - A newb is someone new to a certain industry.
NGMI - Not Going to Make It
Non-Fungible Token (NFT) - An NFT is a digital asset that can uniquely represent a piece of media such as art, videos, music, gifs, games, text, memes, and code.
Off-Chain - A transaction that is processed outside the blockchain network with an increased speed and reduced cost.
On-Chain - Transactions recorded on the blockchain itself and shared with all participants are done on-chain.
Permissionless - Often used to describe blockchains, a system is said to be permissionless when no entity can regulate who can use it and how it can be used.
Play-to-Earn (Play2Earn) - The play-to-earn business model supports the notion of an open economy and gives financial rewards to players who bring value to its metaverse.
Private Key/Secret Key - A piece of code generated in an asymmetric-key encryption process, paired with a public key, to be used in decrypting information hashed with the public key.
Probably Nothing - often used sarcastically to mean the opposite. It probably is something.
Proof-of-Stake (PoS) - A blockchain consensus mechanism in addition to Proof-of-Work that maintains the integrity of the blockchain.
Proof-of-Work (PoW) - A blockchain consensus mechanism involving solving computationally intensive puzzles to validate transactions and create new blocks.
Public Key - A public key refers to alphanumeric characters used to encrypt data.
REKT - A shorthand slang for "wrecked," describing a bad loss in a trade.
Rug Pull - A rug pull is a type of scam where developers abandon a project and take their investors' money.
Satoshi (SATS) - The smallest unit of bitcoin with a value of 0.00000001 BTC.
Satoshi Nakamoto - The individual or group of individuals that created Bitcoin.
Seed Phrase - A series of words generated by your cryptocurrency wallet that give you access to the crypto associated with that wallet.
SER - sir, a polite way of disagreeing with someone
SHA-256 - A cryptographic hash function that generates a 256-bit signature for a text, used in Bitcoin proof-of-work (PoW).
Smart Contract - A smart contract is a computer protocol intended to facilitate, verify or enforce a contract on the blockchain without third parties.
Software Wallet - A software wallet, also known as a wallet app, is an application that allows users to HODL, send, and receive cryptocurrencies.
Solidity - The programming language used by Ethereum for developing smart contracts.
Stablecoin - A cryptocurrency with extremely low volatility that is pegged to a reserve asset like a fiat currency, commodity, or other cryptocurrencies.
Staking - Participation in a proof-of-stake (PoS) system to put your tokens in to serve as a validator to the blockchain and receive rewards.
Sybil Attack - An attack wherein a reputation system is subverted by forging identities in peer-to-peer networks to upset the balance of power.
Token - A digital unit designed with utility in mind, providing access and use of a larger crypto economic system.
Tokenomics - The study of the economics of crypto tokens or cryptocurrencies.
Trustless - An environment where there is no centralized authority.
WAGMI - We're all gonna make it
Wallet - A place where cryptocurrency users can store, send and receive digital assets.
Paper Hands - An investor prone to panic selling at the first sign of a price decline.
Web 1.0 - Web 1.0 is a term often used to describe the early version of the internet.
Web 2.0 - Web 2.0 describes the current state of the web, which supports more user-generated content and stability for front-end users than its predecessor, Web 1.0
Web 3.0 - Web 3.0 is a term used to describe a major shift in the internet's architecture. It's also called the decentralized web because it's not controlled by any one company. Instead, it's controlled by a global network of computers. It's important because it allows users to control their own data, and it will also help create a more fair and equal internet.
Zero-Knowledge Proof - In cryptography, a zero-knowledge proof enables one party to provide evidence that a transaction or event happened without revealing private details of that transaction or event.
Zk-SNARKs - A proof construction that allows one party to prove it owns certain information without revealing it and without any interaction between the prover and the verifier.
What other web 3 terms do you know that aren’t on the list?