General
Learn everything about DeFi Crypto in our Glossary!
- Learn DeFi with DEXTools glossary! If you’re new to crypto world, it’s easy to get lost in the sea of blockchain and cryptocurrency terms. Our DEXTools Academy crypto glossary explains the major cryptocurrency terms you should know when learning about digital currencies. And at all levels of difficulty: basic, advanced and expert!
- It’s advisable to dedicate some time to familiarizing yourself with the trading landscape. However, be mindful that it’s filled with terminology that might be unfamiliar to you.
- We have gathering (and we continue to collect) hundreds of terms for you to know and understand everything about the exciting DeFi and crypto ecosystem! Bellow are just 15 as examples, but we encourage you to visit our extensive glossary for yourself!
- Blockchain: A decentralised, distributed ledger that records all transactions across multiple computers or nodes.
- Cryptocurrency: a digital currency that uses cryptography for security and operates independently of a central bank on the blockchain.
- Altcoin: Any crypto other than BTC, including Ethereum, Ripple, Litecoin etc.
- Exchange: A platform where crypto can be bought, sold, and traded.
- Volatility: Rapid and significant price fluctuations that are common in the crypto market.
- Liquidity: The ease with which an asset can be bought or sold without causing significant price changes, where a deep market with plenty of liquidity indicates a healthy market.
- Liquidity pools: A supply of funds locked in a smart contract that are provided by traders to facilitate trading in decentralised exchanges (DEXs). These pools enable users to trade crypto without relying on traditional order books.
- Market order: An order to buy or sell a cryptocurrency at the best available price in the market.
- Order book: A record of buy and sell orders for a particular crypto, displaying the quantity and price at which traders are willing to buy or sel.
- Market cap: Short for ‘market capitalisation’, this represents the total value of a particular crypto, and is calculated by multiplying the current price of the token (usually in dollars) by the number of available coins circulating.
- Candlestick chart: A graphical representation of price movements of a cryptocurrency over a specific period, which shows the opening, closing, high, and low prices in the form of “candles” on a chart.
- Arbitrage: The practice of taking advantage of price differences in different markets and exchanges to make a risk-free profit.
- Yield farming: A practice in DeFi where users provide liquidity to decentralised exchanges or lending platforms and earn rewards or interest in the form of additional tokens .
- Bull market: A market characterized by rising prices and optimism among traders.
- Bear market: A market characterized by falling prices and pessimism among traders.
Now that you are familiar with some of the terminology, you can safely try out our simulator and keep learning! Click here
One of the key concepts in DeFi is decentralization. Instead of relying on a central authority to manage transactions and data, DeFi platforms use smart contracts: self-executing contracts with the terms of the agreement directly written into code. This allows for trustless transactions, meaning you can interact with DeFi platforms without needing to trust a third party.
Getting started with DeFi and cryptocurrency is easier than you might think. Here are a few steps to help you jump in:
- Educate yourself: Take the time to learn about the basics of blockchain technology, cryptocurrency, and DeFi. There are plenty of resources available online, including articles, videos, and tutorials.
- Choose a wallet: Before you can start buying and trading cryptocurrency, you’ll need a digital wallet to store your assets. There are many different types of wallets available, including software wallets, hardware wallets, and mobile wallets. Research your options and choose one that suits your needs.
- Purchase your assets: Once you have a wallet set up, you can purchase cryptocurrency from a reputable exchange. Popular exchanges include Coinbase, Binance, and Kraken. Be sure to do your research and choose an exchange that is trustworthy and secure.
- Start small: As with any investment, it’s important to start small and only invest what you can afford to lose. Cryptocurrency markets can be volatile, so it’s important to be prepared for fluctuations in price.
- Explore DeFi: Once you’re comfortable with the basics of cryptocurrency, you can start exploring the world of DeFi. There are many different DeFi platforms and protocols available, each offering unique features and opportunities for earning and borrowing.
Remember: the world of DeFi and cryptocurrency is constantly evolving, so don’t be afraid to ask questions and continue learning.
Welcome to the future of finance!
