DeFi Terms

CryptoCarlo.ai Learning Center

Common Crypto, DeFi & Networking Terms

The lingo, explained in plain English. Search the words and acronyms you hear in crypto, DeFi, investing and network marketing.

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New to the lingo? You do not have to memorize everything. Search a term whenever you hear something unfamiliar. Definitions are kept short, practical and beginner-friendly.
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A Few Concepts at a Glance

Some terms make more sense when you can see the idea.

Hot vs. Cold Wallet Connected convenience vs. offline security.
Bull vs. Bear Bullish expects rising prices. Bearish expects falling prices.
Lines / Legs Separate branches growing from a network organization.

The Glossary

Short definitions. Plain English. No unnecessary jargon.

Active

Meeting the activity or qualification requirements needed to receive certain benefits, commissions or rank credit.

Networking

AML β€” Anti-Money Laundering

Rules and procedures designed to detect and prevent money laundering and other illegal financial activity.

Compliance

APR β€” Annual Percentage Rate

An annualized rate of return or cost that normally does not include the effect of compounding.

Money

APY β€” Annual Percentage Yield

An annualized yield that includes the effect of compounding.

MoneyDeFi

ATH β€” All-Time High

The highest recorded market price an asset has reached.

Crypto Slang

ATL β€” All-Time Low

The lowest recorded market price an asset has reached.

Crypto Slang

Bag / Bag Holder

A β€œbag” means someone's holdings. A bag holder often refers to someone left holding an asset after its value has fallen dramatically.

Crypto Slang

Bear / Bearish

Expecting an asset or market to decline in price. A prolonged falling market is commonly called a bear market.

Market Lingo

Blockchain

A digital ledger that records transactions across a network of computers according to the rules of that blockchain.

Crypto Basics

Bonus

Additional compensation earned after meeting specific requirements established by a compensation plan.

Networking

Bridge

A service or protocol used to move or represent assets and data between different blockchain networks.

DeFi

Builder

A member actively developing and supporting a network organization rather than participating only as a customer or user.

Networking

Bull / Bullish

Expecting an asset or market to rise in price. A prolonged rising market is commonly called a bull market.

Market Lingo

Capital / Principal

The original amount of money committed, deposited or invested before gains or losses.

Money

CeFi β€” Centralized Finance

Crypto-related financial services operated by a centralized company or organization rather than solely through decentralized protocols.

Crypto Basics

CEX β€” Centralized Exchange

A cryptocurrency exchange operated by a company that holds or processes user assets and trades.

Crypto Basics

Circulating Supply

The amount of a cryptocurrency or token currently considered available in the market.

Crypto Basics

Closing

Helping a prospect reach a decision after receiving the information needed to evaluate an opportunity. It should not mean pressuring someone to join.

Networking

Cold Wallet

A wallet designed to keep private keys offline or isolated from internet-connected devices, usually for greater security.

Security

Coin

A cryptocurrency native to its own blockchain, such as ETH on Ethereum.

Crypto Basics

Commission

Compensation earned according to the rules of a company's compensation plan.

Networking

Compounding

Leaving earnings in an account so future gains can potentially be earned on both the original capital and previous earnings.

Money

Cryptocurrency / Crypto

A digital asset that uses blockchain or related cryptographic technology to record ownership and transactions.

Crypto Basics

Custodial Wallet

A wallet where another company or service controls the private keys on the user's behalf.

Security

DAO β€” Decentralized Autonomous Organization

An organization or community that uses blockchain-based rules and governance mechanisms to coordinate decisions.

DeFi

dApp β€” Decentralized Application

An application that interacts with blockchain networks or smart contracts.

DeFi

DeFi β€” Decentralized Finance

Blockchain-based financial applications and services that can operate through smart contracts instead of relying entirely on traditional financial intermediaries.

DeFi

Degen

Crypto slang for someone who participates in highly speculative or unusually risky trades and projects.

Crypto Slang

DEX β€” Decentralized Exchange

A blockchain-based exchange where trades generally occur through smart contracts rather than a centralized exchange operator.

DeFi

Diamond Hands πŸ’Ž

Slang for someone who continues holding an asset despite major volatility or market pressure.

Crypto Slang

Direct / Personally Sponsored

A member or customer personally introduced or enrolled by you.

Networking

Downline

The members located beneath you within a network marketing organization.

Networking

Dump

A rapid sell-off of an asset that can cause its market price to fall sharply.

Market Lingo

DYOR β€” Do Your Own Research

Independently verify claims and understand an opportunity rather than relying only on a sponsor, influencer, friend or promoter.

Due Diligence

ERC-20

A widely used token standard on the Ethereum network.

Crypto Basics

Exit Scam

A fraud where project operators collect money or assets and then disappear, shut down operations or prevent users from accessing their funds.

Red Flag

FOMO β€” Fear of Missing Out

The urge to buy, join or invest mainly because other people appear to be benefiting and you are afraid of missing the opportunity.

Crypto Slang

FUD β€” Fear, Uncertainty & Doubt

Information or rumors that create fear or uncertainty around a project or market. Legitimate questions, documented facts and due diligence should not automatically be dismissed as FUD.

Crypto Slang

Gas / Gas Fee

A fee paid to process a blockchain transaction or execute activity on a blockchain network.

Crypto Basics

Governance Token

A token that may give holders voting or participation rights in decisions involving a blockchain project or protocol.

DeFi

GV β€” Group Volume

Qualifying business volume generated by a member's organization. Some plans use terms such as Team Volume or TV instead.

Networking

HODL

Crypto slang for holding an asset rather than selling during market fluctuations. The misspelling of β€œhold” became part of crypto culture.

Crypto Slang

Hot Wallet

A cryptocurrency wallet connected to the internet, making transactions convenient but potentially exposing it to more online security risks.

Security

Impermanent Loss

A potential loss of value experienced by liquidity providers when the prices of assets inside a liquidity pool change relative to each other.

DeFi

Jurisdiction

The country, state or legal territory whose laws and regulations apply to a company, transaction or financial service.

Compliance

KYC β€” Know Your Customer

An identity-verification process commonly used by financial institutions, exchanges and other regulated services.

Compliance

Layer 1 β€” L1

A base blockchain network such as Ethereum, Solana or other independent blockchain systems.

Crypto Basics

Layer 2 β€” L2

A system built on or alongside a base blockchain to improve speed, cost or scalability while relying on the underlying network in some way.

Crypto Basics

Leg / Line

A separate branch of a network marketing organization growing beneath a member.

Networking

License

Formal authorization from a regulator or government authority to conduct specific activities. The important question is what activities the license actually covers.

Compliance

Liquidity

How easily an asset can be bought or sold without causing a significant change in its market price.

DeFi

Liquidity Pool

Crypto assets deposited into a smart contract so users can trade, borrow or perform other DeFi activities.

DeFi

Lockup / Lock-In Period

A period during which funds, tokens or other assets cannot be freely sold, transferred or withdrawn.

Money

LTV β€” Loan-to-Value

A ratio comparing the amount borrowed with the value of the collateral securing the loan.

DeFi

Market Cap

The approximate market value of a cryptocurrency, generally calculated by multiplying its price by circulating supply.

Money

Matching Bonus

A compensation-plan bonus commonly calculated using qualifying commissions or production generated by other members in an organization.

Networking

Mining

A process used by certain blockchains where computing resources help validate transactions and secure the network in exchange for possible rewards.

Crypto Basics

Moon / β€œTo the Moon” πŸš€

Slang expressing an expectation or hope that the price of an asset will rise dramatically.

Crypto Slang

Multisig β€” Multi-Signature

A wallet or account setup requiring more than one authorized signature to approve certain transactions.

Security

Network

The blockchain used for a transaction, such as Ethereum, TRON, Solana or BNB Chain. Sending assets on the wrong network can result in loss of access.

Crypto BasicsSecurity

NFA β€” Not Financial Advice

A common disclaimer used when discussing investments. Writing β€œNFA” does not make false, misleading or irresponsible claims acceptable.

Crypto Slang

NFT β€” Non-Fungible Token

A blockchain-based token designed to represent a distinct digital item, right or record rather than interchangeable units of the same asset.

Crypto Basics

NGMI β€” Not Gonna Make It

Crypto-community slang suggesting someone is making a poor decision or missing an opportunity.

Crypto Slang

Node

A computer or device participating in a blockchain network by storing, validating or relaying network information, depending on the blockchain.

Crypto Basics

Non-Custodial Wallet

A wallet where the user controls the private keys and therefore has direct responsibility for protecting access to the assets.

Security

Offshore

A company, account, broker, fund or financial service established or operated in a jurisdiction outside the country where a customer lives. Offshore does not automatically mean illegal or fraudulent, but regulations, protections, taxes and recovery options may differ.

Due Diligence

Onboarding

The process of helping a new member understand the product, service, tools, procedures and next steps after joining.

Networking

Paper Hands

Slang for someone who sells quickly when an asset falls in price or uncertainty increases.

Crypto Slang

Passive Income

Income requiring relatively little ongoing activity after setup. Passive does not mean guaranteed, risk-free or permanent.

Money

Placement

Where a new member is positioned inside a network marketing organization's structure.

Networking

Ponzi Scheme

A fraudulent arrangement where money from newer participants is used substantially to pay earlier participants while being presented as legitimate investment profits.

Red Flag

Private Key

A secret cryptographic credential used to control assets in a blockchain wallet. Anyone who obtains it may be able to control the wallet.

Never Share

Profit / Gain

The amount earned above the original cost or capital, before or after expenses depending on how the calculation is presented.

Money

Prospect

Someone who is learning about a product, service or opportunity but has not yet made a decision to participate.

Networking

Public Address / Wallet Address

A blockchain address used to receive cryptocurrency. It can generally be shared, unlike a private key or seed phrase.

Crypto Basics

Pump

A rapid increase in the price of an asset, sometimes caused by legitimate demand and sometimes by speculation or coordinated promotion.

Market Lingo

Pump & Dump

A scheme where promoters hype or manipulate an asset upward and then sell their holdings into the increased demand, often leaving later buyers with losses.

Red Flag

PV β€” Personal Volume

Qualifying business volume generated personally by a member, according to a compensation plan.

Networking

Rank

A recognition or compensation-plan level achieved after meeting specific qualification requirements.

Networking

Rank Advancement / Promotion

Moving to a higher network marketing rank after satisfying the required qualifications.

Networking

Recovery Phrase

A sequence of words used to restore access to many cryptocurrency wallets. Anyone with the phrase may be able to control the wallet.

Never Share

Referral Income

Compensation earned from qualifying personally referred business according to a compensation plan.

Networking

Registration

A company's formal filing or legal presence in a jurisdiction. Registration by itself does not necessarily mean the company is licensed to conduct every type of financial activity.

Compliance

Reinvestment

Putting earnings or distributions back into an investment or strategy rather than withdrawing them.

Money

Rekt

Crypto slang for suffering a major trading or investment loss.

Crypto Slang

Residual Income

Income that may continue from ongoing qualifying activity instead of being generated only by a single transaction.

Networking

ROI β€” Return on Investment

A measure comparing an investment's gain or loss with the amount originally invested.

Money

Rug Pull

A crypto scam or project failure where insiders drain liquidity, abandon the project or otherwise leave participants holding assets that lose much or all of their value.

Red Flag

Seed Phrase

A set of recovery words capable of restoring access to many crypto wallets. Never send it to anyone asking for verification or technical support.

Never Share

Shill / Shilling

Aggressively promoting a token, project or investment, especially when the promoter minimizes risks or has an undisclosed financial interest.

Crypto Slang

Slippage

The difference between the expected price of a trade and the price at which the transaction actually executes.

DeFi

Smart Contract

Code deployed on a blockchain that automatically performs programmed actions when its conditions are met.

DeFi

Sponsor

The person who personally introduced or enrolled another member into a network marketing organization.

Networking

Stablecoin

A cryptocurrency designed to maintain a relatively stable value, commonly by referencing a currency such as the U.S. dollar.

Crypto Basics

Staking

Committing tokens to support a blockchain or protocol and potentially receive rewards. Projects sometimes use the word more loosely, so always check how the specific program works.

DeFi

Swap

Exchanging one cryptocurrency or token for another, commonly using an exchange or decentralized protocol.

DeFi

Team Volume

Qualifying business volume generated by a member's organization. Exact calculations vary by compensation plan.

Networking

Token

A digital asset created using an existing blockchain or blockchain ecosystem.

Crypto Basics

Tokenomics

The economic structure of a token, including supply, distribution, utility, incentives, emissions, burns and vesting.

Crypto Basics

Total Supply

The total number of tokens currently created or existing under a project's supply rules, depending on how the project reports supply.

Crypto Basics

TRC-20

A token standard used on the TRON blockchain. USDT is commonly transferred using TRC-20.

Crypto Basics

TXID / Transaction Hash

A unique identifier used to locate and verify a blockchain transaction.

Crypto Basics

TVL β€” Total Value Locked

The estimated value of assets deposited in a DeFi protocol or collection of protocols.

DeFi

Upline

The sponsors and organizational members positioned above you within a network marketing structure.

Networking

USDC

A U.S. dollar-referenced stablecoin commonly used for crypto payments, trading and transfers.

Crypto Basics

USDT β€” Tether

A widely used U.S. dollar-referenced stablecoin available on several blockchain networks.

Crypto Basics

Vesting

A schedule that gradually releases tokens, ownership rights, rewards or other benefits over time.

Money

Volume

A measurement used by compensation plans to determine qualification, rank or commissions. It may differ from the actual dollar amount of a purchase or investment.

Networking

WAGMI β€” We're All Gonna Make It

Crypto-community slang expressing optimism about a project, community or market.

Crypto Slang

Wallet

A tool used to manage the cryptographic keys that control access to cryptocurrency and blockchain assets.

Crypto Basics

Whale πŸ‹

A person, organization or wallet holding a very large amount of a particular cryptocurrency or asset.

Crypto Slang

Whitepaper

A document explaining a project's concept, technology, token structure or objectives. A professional-looking whitepaper is not proof that a project is legitimate.

Due Diligence

Withdrawal

Moving money, cryptocurrency or other assets out of an account, wallet, platform or investment.

Money

Withdrawal Fee

A fee charged when assets are removed from an account or platform.

Money

Wrapped Token

A token designed to represent another asset in a format compatible with a particular blockchain or DeFi protocol.

DeFi

Yield

The income or return generated by an asset, investment or financial strategy over a period of time.

Money

Yield Farming

Using crypto assets in DeFi protocols to pursue yield, incentives or token rewards.

DeFi
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⚠️ One important reminder:
Knowing the terminology does not make an investment, platform or crypto project safe. Understand what the term means, verify how it applies to the specific opportunity, and do your own due diligence before making a financial decision.