A word should open a door.

Barter: Directly exchanging one good or service for another. It is a useful comparison with money, not a complete account of every society’s monetary history.

Double coincidence of wants: The barter problem of needing someone who wants what you offer and offers what you want, at a suitable time.

Durable: Able to survive storage and use without quickly losing the qualities that make it useful as money.

Portable: Practical to move or transfer. Physical weight, payment infrastructure and access can all matter.

Divisible: Able to be separated into smaller usable units, so both small and large payments are possible.

Fungible: Units are interchangeable for the same purpose. Identical denominations do not always receive identical treatment when histories or restrictions matter.

Scarce: Limited relative to demand. Scarcity alone does not create a reason to want something.

Rai stones: Large stone money associated with Yap. Socially recognized ownership could change without moving a stone.

Debasement: Reducing the precious-metal content of coinage while retaining its stated denomination; used more loosely for other losses of monetary quality.

Stock: The amount already in existence at a stated time. Specify whether a supply estimate includes lost or inaccessible units.

Flow: The amount added over a stated period. A yearly flow and a monthly flow cannot be compared without adjusting their units.

Stock-to-flow: Existing stock divided by new annual production. It describes a supply relationship; it is not a law that determines price.

Hard money: A term for money whose supply is relatively difficult to expand. It does not mean its price or purchasing power cannot fall.

Easy or soft money: A term for money whose supply can expand more readily. The term alone does not explain an inflation rate or a person’s behavior.

Bank deposit: A claim on a bank, recorded as its liability to the depositor. Bank deposits differ from directly held cash.

Fractional-reserve banking: Banking in which deposits are not matched one-for-one by immediately available reserves. Modern banks create deposits when lending, within funding, liquidity and capital constraints.

Bank run: Many customers seeking withdrawals at once. A bank may struggle to turn longer-term assets into enough immediate cash.

Bretton Woods: The post-1944 monetary arrangement linking participating currencies to the dollar and official foreign dollar holdings to gold. U.S. gold convertibility was suspended in 1971.

Reserve currency: A currency held by monetary authorities for purposes such as international payments, intervention and reserves. This is an institutional role, not proof of permanent dominance.

Cantillon effect: The idea that new spending power enters unevenly, affecting different people and prices at different times. It is not a complete explanation of every distributional outcome.

Time preference: How someone values present consumption relative to later consumption. Resources, uncertainty and circumstances matter; patience is not a measure of moral worth.

Nominal and real returns: A nominal return counts money units. A real return adjusts for changes in purchasing power; the exact calculation divides the two growth factors.

Double-spend problem: Preventing the same digital funds from paying two recipients when copies of messages are easy to make.

Value containment: A phrase used in the earlier course for preserving the integrity of digital balances. The more precise ideas are valid issuance and prevention of double spending.

Byzantine Generals Problem: A classic model of agreement when some participants may fail or send conflicting information. Blockchains address particular versions under explicit assumptions.

Sybil attack: One actor creates many identities to gain influence. Resource-weighted mechanisms aim to make extra names alone insufficient.

Peer-to-peer: Participants communicate with other participants rather than relying entirely on one central service. Peer connections do not by themselves establish trust.

Distributed record: Copies of a record held in several places. All copies can still be controlled by one organization.

Validity rules: The conditions a transaction or block must satisfy. Having more work or stake does not make an invalid transaction valid.

Fork choice: The method for selecting between eligible competing histories. It operates alongside validity checks, not in place of them.

Most-work rule: Bitcoin’s preference for the valid chain with the most accumulated proof of work. It is not simply the chain with the most blocks.

Blockchain: A record grouped into blocks linked by cryptographic hashes. Its security also depends on validation, consensus and operational assumptions.

The constitution analogy: A teaching comparison: validity rules say what is allowed; consensus helps settle the accepted history. Software has no literal constitution, court or universal electorate.

DigiCash: A company associated with David Chaum’s electronic-cash designs, including cryptographic privacy. It still depended on an issuing institution.

e-gold: An internet payment system with balances tied to centrally held gold. Custody and legal dependence remained central to its design.

Hashcash: Adam Back’s proof-of-work design for making messages costly to produce. It was not itself the complete Bitcoin monetary system.

b-money: Wei Dai’s proposal for distributed digital money. It contributed ideas without becoming the same deployed system as Bitcoin.

Bit Gold: Nick Szabo’s proposal involving costly digital work and ownership records. It is a historical precursor, not Bitcoin under another name.

Hal Finney: A cryptographer and early Bitcoin participant who described receiving an early transaction from Satoshi. His account is a historical source.

Public key: Information mathematically related to a private key that helps verify signatures without revealing the secret.

Address: An identifier or encoded payment destination. Its format and meaning depend on the network; an address alone does not identify a person.

Digital signature: A cryptographic proof of authorization for specified data. It does not establish that a deal is honest or a program is safe.

Custodial wallet: An arrangement where a provider controls the keys and the user relies on its account access and withdrawal process.

Self-custody: An arrangement where you control the required signing authority. It also makes recovery and protection your responsibility.

Hot wallet: A wallet whose signing environment is connected to an online device. Convenience increases exposure to that environment.

Cold storage: Keeping signing secrets offline. Offline storage still requires sound generation, backups and transaction verification.

Hardware wallet: A device designed to keep keys inside a separate signing environment. Its trusted display helps you inspect what you authorize.

Multisig: Spending rules that require a threshold of several keys. Recovery may require wallet configuration as well as enough surviving keys.

Counterparty risk: The risk that a party you depend on fails, refuses or cannot fulfill its obligation.

Passphrase: An additional secret that some backup systems use to derive a different wallet. A correct phrase with a different passphrase can restore different accounts.

Change: Value returned to the sender in a new output when a Bitcoin transaction spends inputs larger than its payment and fee.

Mempool: A node’s collection of unconfirmed transactions it currently accepts. There is no single globally identical waiting room.

Transaction fee: Payment for inclusion or execution under the network’s rules. Fees depend on the relevant resource demand, not just the amount of money sent.

Block: A batch of transactions and associated information accepted together under a network’s rules.

Hash: A fixed-size output calculated from input data. A secure hash makes certain forms of tampering easy to detect; it is not encryption.

Avalanche effect: A small input change produces a very different-looking hash output. This does not mean an edit becomes physically impossible.

Collision: Two different inputs producing the same hash. Collisions must exist in principle for fixed-size hashes; finding useful ones should be computationally infeasible.

Block header: Compact block metadata used in linking and validation. Bitcoin’s header commits to the previous block and its transaction data.

Merkle tree and root: A tree of hashes summarized by one root. It allows a compact proof that particular data belongs to the committed set.

Immutable or immutability: Difficult to alter under stated assumptions. Blockchain history is not beyond bugs, reorganizations or collectively adopted rule changes.

Reorganization: Replacing part of an accepted chain history with another eligible branch. Recent transactions may return to pending status or conflict.

Nonce: A field miners vary while searching for a valid block hash. Mining software also changes other candidate data to expand the search space.

Target and difficulty: The target is the maximum acceptable proof-of-work hash value. A smaller target means harder work on average; difficulty expresses that relationship.

Hashrate: The rate of hash attempts. Network hashrate is estimated from observed blocks and difficulty rather than directly counted in one central meter.

Difficulty adjustment: Bitcoin’s periodic retargeting, ordinarily every 2,016 blocks, to keep the average block interval near its intended pace. Individual intervals still vary.

Coinbase transaction: The special first transaction in a Bitcoin block that can claim the allowed subsidy and fees. It is unrelated to the exchange of the same name.

Block subsidy: New coins a valid block may create according to the issuance schedule. Fees are a separate part of the miner’s potential revenue.

ASIC: An application-specific integrated circuit. Bitcoin mining commonly uses chips designed specifically for its hashing work.

51% attack: Majority hashpower can make some censorship and history-reversal attacks practical. It cannot forge another person’s signature or force validating nodes to accept arbitrary issuance.

Stranded energy: Energy with limited access to another useful buyer at a particular place or time. Whether mining uses it and at what environmental cost is context-specific.

Antifragile: A term for a system improving through certain stresses. It is an interpretation to test, not a guarantee that attacks always strengthen Bitcoin.

Issuance: Creation of new monetary units according to a system’s rules. Issuance is different from a change in their market price.

21 million: The familiar description of Bitcoin’s scheduled upper supply under its current rules. It does not promise that every issued unit remains accessible.

Satoshi or sat: One hundred-millionth of a bitcoin. Buying or transferring a fraction can still be subject to provider minimums and network fees.

BIP: A Bitcoin Improvement Proposal: a documented proposal or standard. Publication is not automatic approval or activation.

Soft fork: A rule change that narrows what is valid. Older software can accept compliant new blocks while failing to enforce the added restriction itself.

Hard fork: A change that can allow blocks older rules reject. Whether it produces a lasting split depends on adoption and continued support.

Open source: Software whose source is available under a license permitting specified uses and modifications. Availability does not prove anyone audited every line.

Ossification: A tendency or preference toward fewer protocol changes. It trades some adaptability for reduced change risk; it is not an absolute technical state.

Blockchain trilemma: A shorthand for tensions among decentralization, security and scaling. It is a design lens, not a proven universal equation.

Layer 1 or L1: A base blockchain with its own transaction validation and consensus system.

Layer 2 or L2: A system that moves some activity off a base chain while depending on it for specified settlement or security functions. Designs and guarantees vary.

Lightning Network: A Bitcoin payment-channel network that can route payments without recording every update on the base chain. Liquidity and reliable operation matter.

Payment channel: A construction allowing participants to update a balance arrangement and later settle through base-chain rules. Opening, closing and disputes have conditions.

Remittance: Money sent to someone elsewhere, often across national borders. End-to-end costs include conversion, access and cash-out as well as network fees.

Taproot: A Bitcoin upgrade to spending rules with efficiency, flexibility and some privacy benefits. It does not make every transaction private.

Ordinals: A system for identifying individual satoshis; inscriptions associate data with them under its conventions. This does not create copyright or universal application support.

Pizza Day: A reference to the documented 2010 purchase of pizza for 10,000 BTC. Later prices do not tell us what participants knew at the time.

Faucet: A service distributing small amounts of an asset, historically to introduce people to a network. A modern offer can still be a scam.

UASF: User-activated soft fork: activation through enforcing rules in participating nodes’ software. The label does not turn each node into an equal governance vote.

SegWit: Segregated Witness, a Bitcoin upgrade that changed how signature-related data is represented and introduced block-weight rules.

ICO: Initial coin offering: raising funds by distributing or selling tokens. A token sale does not establish buyer rights, safety or lawful status.

Crypto winter: An informal name for a prolonged downturn in crypto markets or activity. It has no exact universal start or end rule.

Terra and Luna: Assets in an ecosystem whose stablecoin mechanism collapsed in 2022. A stabilization design can fail under the pressure it was meant to handle.

FTX: A crypto exchange that collapsed in 2022 amid misuse of customer funds. An exchange balance is a claim on an organization.

Spot ETF or ETP: An exchange-traded product offering exposure through holdings of the underlying asset. Shares involve product fees, custody arrangements and market risks.

Futures ETF or ETP: An exchange-traded product using futures contracts. Its returns can differ from the spot asset because of contract pricing, rolling and fees.

Ethereum Classic: The network continuing the Ethereum history without the 2016 DAO recovery fork. Its existence preserves a real disagreement over intervention.

CryptoKitties: An early Ethereum application using collectible tokens. It helped demonstrate both demand for on-chain applications and capacity constraints.

Dencun: Ethereum’s 2024 upgrade introducing temporary blob data capacity used by rollups. Lower data cost does not eliminate every rollup fee or risk.

The Merge: Ethereum’s September 2022 transition from proof of work to proof of stake. It changed consensus without replacing all application balances.

Vitalik Buterin: The author of the original Ethereum whitepaper and one of Ethereum’s co-founders. The network’s development involves many participants.

World computer: A metaphor for a shared system executing programs and agreeing on their results. It is not a cheap replacement for every ordinary computer.

Turing complete: Able to express general computation in principle. Actual Ethereum execution is bounded by resources such as gas, so a transaction cannot compute forever.

Solidity: A programming language widely used for Ethereum smart contracts. The language does not guarantee the safety of the program.

Account model: A record of balances and other account state, updated by execution. Bitcoin’s UTXO model organizes spendable value differently.

Externally owned account: An account controlled through a private key. Modern Ethereum delegation can add code-driven behavior, so “can never have code” is outdated.

Contract account: An account associated with deployed code and state. Code runs when called as part of execution, not because it independently wakes up.

EVM: Ethereum Virtual Machine: the execution environment defining how compatible program instructions change state.

State: The network’s currently accepted data, such as balances, contract storage and account information.

Native coin: An asset defined by a network’s own protocol rather than issued as an application token. Native status does not guarantee financial value.

EIP-1559: Ethereum’s fee mechanism with a base fee burned by the protocol and a priority fee for inclusion incentives. Burning fees does not guarantee falling total supply.

ERC-20: A common Ethereum-compatible interface for fungible tokens. Shared functions make integration easier; they do not certify a token’s economics.

ERC-721: A common interface for non-fungible tokens with individually identified token IDs. It specifies token behavior, not automatic legal rights.

Bridge: A system linking assets or information across networks. It adds assumptions about custody, verification or messaging beyond either token’s name.

Rollup: A scaling system that executes activity outside a base layer and publishes data or commitments under a settlement arrangement. Its exact security model matters.

Optimistic rollup: A rollup design that relies on a challenge process to dispute invalid claims during specified periods.

ZK or validity rollup: A rollup that uses cryptographic validity proofs to demonstrate correct state transitions. “ZK” does not necessarily mean users’ transactions are private.

Reentrancy: A contract interaction that calls back into code before the original operation has safely finished updating its state. It can break accounting assumptions.

Oracle: A mechanism supplying information that a contract cannot learn directly from its own chain. External truth does not become certain merely by being submitted.

Staking: Committing assets to support specified protocol duties. Direct validation, pooled services and liquid-staking tokens expose users to different risks.

Attestation: A validator’s signed statement about its view of the chain. It contributes to fork choice and finality under the protocol’s weighting rules.

Slashing: A penalty for specific provable consensus violations, such as conflicting signatures. It is distinct from ordinary missed-duty penalties.

Inactivity penalty: A penalty related to failure to participate. Ethereum also has an inactivity-leak mechanism when finality is delayed; not every offline event is slashing.

Liquid staking: An arrangement issuing a token representing a claim associated with staked assets. The token adds contract, operator, pricing and redemption risks.

Internet and Web: The internet connects networks. The Web is one system for accessing linked information over that infrastructure; it is not the entire internet.

Wallet-based access: Using keys and signatures to connect to applications or authorize actions. A common wallet does not guarantee that applications share rights or support the same assets.

DAO: Decentralized autonomous organization: a group coordinating through some combination of contracts and governance. Token voting, admin powers and legal arrangements require inspection.

DAI and MakerDAO: A dollar-targeting token and the protocol historically associated with issuing it against collateral. Their mechanisms and governance evolved; names alone do not explain current risk.

Overcollateralized: Backed by collateral valued above the borrowed amount. A price fall, stale oracle or failed liquidation can still create losses.

Liquidation: A forced or rules-based closure or sale of a position when requirements are breached. Fees and rapid price changes can worsen the result.

Yield farming: Moving or supplying assets to earn fees, interest or token incentives. A displayed rate may include temporary issuance and does not describe all risk.

Yield test: A plain question from this course: who pays the return, why do they pay it, and what can interrupt that flow?

NFT: A non-fungible token representing a distinct on-chain identifier. Associated media, permissions and copyright depend on separate arrangements.

Digital gold: A comparison emphasizing scarcity and a potential store-of-value role. It is an investment thesis, not a guarantee of gold-like stability.

Maximalism: A strong preference for one network or asset, sometimes coupled with rejection of alternatives. It is a viewpoint rather than technical evidence.

Uniswap: A family of decentralized-exchange protocols and related interfaces. Versions and individual pools can use different features and carry different risks.

Pool reserves: The assets held by a pool under its accounting rules. Reserves are not the same as the market capitalization of every token.

Invariant: A mathematical relationship a pool’s trades must satisfy, with fee adjustments where applicable.

Constant-product AMM: A pool design often introduced by x × y = k. Removing one reserve makes further purchases progressively more expensive in the simple fee-free model.

Arbitrage: Trading across different prices to seek a profit. It can bring pool prices closer to outside markets while changing the assets held by liquidity providers.

Price impact: The movement in a market’s quoted price caused by the size of your own trade. Thin liquidity usually makes a given trade move price more.

Slippage: The difference between an expected execution result and the actual result. A slippage limit constrains acceptable execution; it does not certify a fair quote.

StableSwap: A pool design intended for assets expected to trade near a common value. A broken peg can turn that efficiency into concentrated exposure.

Weighted AMM: A pool using specified asset weights, which can differ from equal shares. Its pricing and inventory behavior follow the chosen invariant.

Concentrated liquidity: Liquidity supplied within a chosen price range. It can earn no swap fees while inactive and become entirely one asset outside that range.

Hooks: Optional code attached to specified pool operations in systems such as Uniswap v4. Extra flexibility introduces extra behavior to understand.

MEV: Maximal extractable value: value captured through transaction inclusion, exclusion or ordering. Some forms impose additional costs on other traders.

Altcoin: A broad informal term for cryptoassets other than bitcoin. It groups together systems with very different purposes and risks.

Chain versus contract: The distinction between a network’s own consensus system and an application deployed on a network. Sharing a host does not remove application risk.

Memecoin: A token whose attention and demand often center on a joke, identity or community. Its category does not establish durable demand or exit liquidity.

Privacy coin: An asset or network designed to obscure specified transaction information. Privacy properties, operational limits and legal treatment vary.

Narrative: A story used to explain why an asset should matter. Test its causal claims against observable use, rights, costs and risks.

Fully diluted valuation or FDV: A unit price multiplied by a broader stated supply measure. Supply definitions differ, and today’s price may not hold as more units become available.

Unlock and vesting: A release of previously restricted tokens, or the schedule governing that release. Availability to sell does not guarantee that every holder sells.

Exit liquidity: The buyers or pool reserves available to absorb someone’s sale. The phrase can also describe people targeted to buy insiders’ holdings.

Base rate: The frequency of an outcome in a clearly defined comparison group. A visible collection of winners is not the whole group.

Wash trading: Activity arranged without the economic independence ordinary trading volume suggests, such as one controller trading between its accounts.

Winner-take-most: A possible market outcome where a small number of participants capture a large share. It is not a law that selects a future winning token.

One-page research report: A concise account of a project’s purpose, control, token role, supply, liquidity, evidence and failure conditions. Its value lies in checkable reasoning.

Bear case: The strongest reason a project or investment thesis could fail. A useful bear case identifies a mechanism and evidence that would matter.

Contract address: The network-specific identifier of a deployed contract. Matching a familiar name or symbol is not enough to identify the intended token.

Rug pull: An informal term for insiders abandoning a project or extracting value through powers such as draining liquidity, minting or abusive controls.

2FA or MFA: Two-factor or multifactor authentication: access requiring distinct kinds of evidence. Recovery routes and the chosen factors affect protection.

Passkey: A public-key credential bound to a service. Properly implemented passkeys can resist website impersonation better than codes typed into a page.

SIM swap: An attacker taking control of a phone number through carrier processes or account compromise, potentially intercepting calls or text-based recovery.

Test transaction: A small transfer used to check a route. Success does not prove that a later address, network, asset, memo or permission is correct.

Memo or destination tag: Additional routing information some custodians require to credit the intended account. A correct address may still be insufficient.

Tampered device: A device or setup altered to expose secrets or manipulate authorization. A recovery phrase supplied by a seller is a serious warning sign.

Savings and spending wallets: Separating long-term storage from frequent application use. Separate accounts derived from one leaked seed do not isolate that seed-level risk.

Permit signature: A signed message that can authorize a token allowance under a compatible design. A message with no immediate gas fee can still grant spending authority.

Disconnect and revoke: Disconnecting ends an interface connection. Revoking changes an allowance on chain; neither action makes an exposed seed secret again.

Relationship investment scam: A fraud using sustained personal trust to guide someone toward a fake investment. Sometimes called “pig butchering”; responsibility lies with the scammer.

Address poisoning: Placing look-alike addresses in a transaction history so a victim copies the wrong destination. Verify through an independent trusted route.

Clipboard malware: Software that changes copied data, such as a payment address. Check the complete destination on a trusted display.

Pump and dump: Promoting and buying an asset to attract others, then selling into the induced demand. Apparent enthusiasm can be coordinated.

Five filters: The earlier course’s mnemonic for checking secrecy, pressure, guarantees, unsolicited contact and money requests. These are prompts to investigate, not a complete fraud detector.

Recovery scam: A second fraud promising to retrieve lost funds, often for an advance payment or further access. Recovery is never assured by a stranger’s claim.

Gray area: The earlier course’s label for uncertain readiness. Make the uncertainty specific: essential needs, debt, loss capacity, knowledge or custody preparation.

Taxable event: An action that can create tax consequences under the applicable rules. In the U.S., sales, swaps and spending can realize gains or losses; rules vary.

Holding period: How long an asset was held under applicable tax or investment definitions. Tax treatment depends on jurisdiction and facts.

Cost basis: The tax accounting amount assigned to an asset, used with proceeds to determine relevant gains or losses under applicable rules.

DCA: Dollar-cost averaging: investing a fixed amount at regular intervals. It changes purchase timing, not the possibility of loss.

Accumulation: Gradual buying, or a label applied to a quieter market phase. Price charts alone do not reveal every participant’s intent.

Mania: Intense speculative enthusiasm. It is a descriptive judgment, not a reliable signal of a precise market top.

Bear market: A sustained market decline, often conventionally described using a 20% peak-to-trough threshold. Definitions and time horizons vary.

Sizing test: Considering how a loss or prolonged inability to access funds would affect essential life commitments. Passing a hypothetical test does not make an asset safe.

Credit cycle: Changes in the availability and terms of borrowing that can amplify spending, asset demand and subsequent contraction. It does not fix a crypto timetable.

FOMO: Fear of missing out: urgency created by imagining gains others may enjoy. It supplies information about a feeling, not the next price.

FUD: Fear, uncertainty and doubt. Often used to dismiss criticism; a concern should instead be judged by evidence.

Euphoria: An intense positive feeling that can make uncertainty seem smaller. Feeling confident does not establish that an investment is sound.

Capitulation: Giving up and selling, often after a painful decline. It is not proof that a market has reached its final low.

HODL: Crypto slang for holding an asset, originating as a misspelling of “hold.” A slogan cannot decide whether holding fits a particular situation.

Position trading: Holding a position over a longer horizon than very short-term trading. Definitions vary; longer duration does not eliminate risk or tax consequences.

Diligence: Careful, continuing work to check evidence and follow a sensible process. Effort improves the quality of a decision without guaranteeing its outcome.