Simplified Web3 Terminologies You Must Know as a Beginner

Even while very good at writing, I had trouble with registers when I started in Blockchain writing. In case you don't know- registers are like a set of terminologies mostly specific to a particular industry or niche. In web3, you should have noticed a lot of "jargon" flying around, and though you genuinely want to venture into the web3 space, it seems this particular thing scares you. But be happy; once you get to this point of inquiry, you just crossed the threshold for your next takeoff!

Learning technical terms helps you express yourself better, especially as a writer in web3. For instance, you shouldn't say, "Solana's price is going very low," when it is more understandable as "SOL is currently in a bearish market."

In my process of research and writing in the blockchain, I came across so many buzzwords that I had to search the glossary for. I will list them here, in case you are like me who want to get more familiar with terms in web3.

Ready? Let's go!

Airdrop

This is a marketing tactic involving crypto projects sending their native tokens straight to users' wallets upon fulfillment of participation requirements, aiming to mass adoption and awareness. Token airdrops are offered to promote community participation.

Bridge

This serves as a link that enables interactions across several blockchains, ultimately enabling the exchange of data, money, and other types of information between networks.

Burning

This is the method by which miners permanently remove crypto coins from circulation. To prevent future trading, they send the coins to specific addresses whose private keys are untraceable. Gas fee is the charge for completing a transaction or contract on the Ethereum blockchain.

Cold wallet

This is an offline wallet for storing digital assets and is, therefore, much less likely to be attacked since it is not connected to the internet. These wallets may also be known as hardware wallets or offline wallets.

Hot wallet

This is an internet location for storing digital assets. It is more vulnerable to hackers since it can be easily accessed on mobile.

Ape in

This means to rush into investing heavily in a token before fully understanding the asset or investing in an NFT startup without doing much or any investigation. The idea is to support soon after debuting to enjoy potential big gains without the buyer performing any due diligence.

Floor price

This is the lowest price to acquire an NFT in a collection.

Fork

This is a modification to a blockchain model or program that enables two programs to share the same past history. A hard fork is a protocol change made to a network that can validate previously invalid blocks and transactions in a blockchain. A soft fork is an improvement to the blockchain technology software protocol that renders previously valid transactions invalid.

DeFi

Decentralized finance, or DeFi, is the term used to describe a financial system based on the blockchain fully decentralized and not controlled by any central authority, like a bank, government agency, or financial management company.

Rugged

This is a word that means duped or scammed by web3 project creators.

NFT

Non-fungible token, NFT, is a digital asset with unique features that cannot be substituted. Unlike fungible tokens, NFTs are not convertible among themselves.

CRYPTO

In full- cryptocurrency is a digital currency protected by cryptography, making it hard to forge or double spend. Cryptocurrencies run through decentralized networks on blockchain technology.

Bitcoin

The ultimate and most widely used form of cryptocurrency, launched in 2009. Bitcoin records all transactions in a transparent, open ledger. The network takes place directly between users without the need for intermediaries.

Ethereum

This is an open-source network that functions with smart contracts. Ether is the cryptocurrency for the Ethereum network. Ether is the next most widely used cryptocurrency after Bitcoin. Ethereum differs slightly from Bitcoin in that its long-term objectives involve using blockchain technology for various applications. Generally, Bitcoin and Ethereum function on a proof of work protocol, but Ethereum aims to switch to a proof of stake protocol by next month.

Blockchain

This is a public database that is spread across a vast number of machines in a computer network. It is the blockchain technology that powers the operation of cryptocurrency systems like Bitcoin and Ethereum.

DAO

Decentralized Autonomous Organization, DAO, is an open-source company run by its members. It is a community-led, tokenized, decentralized organization without a central authority. DAO replaces the conventional hierarchical process of legacy organizations with blockchain-based principles and is concentrated on a specific project or goal.

DApp

Decentralized application, DApp, is software built on the blockchain. DApps operate independently in line with the conditions of smart contracts. They have a user interface like any other app on your phone.

Collateral

This can be used as security for a loan and can take the form of a tangible asset like real estate. A mortgage is a typical example of collateral in conventional banking.

Smart contracts

These are digital treaties maintained on a blockchain and executed automatically when certain criteria are met. Without the involvement of brokers or attorneys, smart contracts enable the execution of reliable transactions. These transactions are both traceable and irrevocable.

DEX (Decentralized Exchange)

This is a peer-to-peer crypto exchange based on the blockchain network. Instead of a middleman or centralized organization, a DEX is fully managed by its users and smart contracts.

Stablecoin

This is a token with a value based on another asset. A fiat currency, like the US dollar, typically backs these coins. They can, however, also be supported by physical assets like precious metals or even other cryptocurrencies, like Bitcoin.

Token

This is an established digital asset on an active blockchain. It signifies a tradeable asset on its blockchain and enables the holder to use it for financial or commercial purposes.

Sharding

This is a method for increasing the scalability of a network by splitting its nodes into smaller groups (shards). The network can then reach an agreement through these shards, negating the need for nodes to carry out transactions separately.

Minting

The act of publishing a unique copy of your token on the blockchain, thereby converting it to a purchasable NFT.

Proof-Of-Work

This is a consensus model in which miners must solve complex mathematical puzzles to verify exchange and mint blocks. When miners complete a challenge, they are granted permission to create a new block and earn the block reward and transaction fees.

Proof of Stake

This is a consensus-based approach, and each validator's contribution to the process is directly correlated with the size of their stake in the coin being exchanged.

Liquidity

The term "liquidity" describes how swiftly a product can be purchased, sold, or traded in a certain market.

Altcoin

short for "alternative coins," refers to cryptocurrencies apart from Bitcoin and Ethereum.

Bear Market

This is a prolonged period of falling prices on a market.

Bull Market

A financial market in which prices are rising or are anticipated to grow.

Staking

The process of locking digital assets on a chain, typically in exchange for some reward (e.g., interest, token yield, etc.).

Avatar

An avatar is a digital image of a person or other entity in virtual reality (VR), a video game, the internet, or another environment.

Common Acronyms Like:

NGMI -"not gonna to make it," is frequently used to describe a token or campaign that is not expected to achieve significant value.
WGMI -"we're gonna make it"– is the opposite of NGMI.
HODL -means a hold in terms of buying and storing Bitcoin and other cryptocurrencies.
FOMO -in full- Fear Of Missing Out is the worry of missing out on an opportunity.
NFA -Not Financial Advice is a disclaimer informing potential investors of the dangers of cryptos and NFT projects.
P2P -"Peer-to-peer" is a platform that allows two people to communicate with each other without the need for a middleman.
BUIDL -This is a phrase formed from the word "Build" that denotes the process of creating and improving the blockchain ecosystem.

Conclusion

I hope this helps a lot. Now, go smash that next web3 writing/speaking contest because you just learned these new technical terms. With these and a bit of web3 enthusiasm, you will not struggle anymore with clear expressions.