Bitcoin Terms: A Comprehensive Glossary
Using clear definitions and helpful examples, we've put together a helpful list of key terminology related to Bitcoin.
B
Bitcoin Carnivore
Bitcoin Carnivores are a small group of Bitcoiners that eat only meat.
Bitcoin Dominance
Bitcoin Dominance is a metric used to define the share of Bitcoin’s market cap compared to the rest of the crypto market.
Bitcoin Holders
A Bitcoin holder is anyone who owns Bitcoin, whether a small fraction or a large sum, and can range from individual retail investors to large institutions.
Bitcoin Liquidity
Bitcoin liquidity refers to the ease with which Bitcoin can be bought or sold in the market without significantly affecting its price.
Block Height
Block height is the position of a block in a blockchain, determined by counting the number of confirmed blocks before it.
Block Size Debate
The block size debate was a dispute over increasing Bitcoin's block size to handle more transactions, with 'big blockers' favoring growth and 'small blockers' prioritizing security.
Block Subsidy
The Bitcoin block subsidy is the portion of the block reward that the Bitcoin network automatically provides to miners, independent of transaction fees.
C
Cloud Mining
Cloud mining is a service where you rent Bitcoin mining hardware, but most companies offering it are scams without real mining operations.
Confirmations
In Bitcoin, a confirmation means a transaction has been added to a block.
D
Difficulty
Bitcoin mining difficultyis a measure of how hard it is to mine a new block on the Bitcoin network, adjusting roughly every two weeks to keep block production steady.
Dollar Cost Averaging (DCA)
Dollar Cost Averaging (DCA) is a strategy where you invest a fixed amount in Bitcoin at regular intervals to reduce the impact of price volatility.
Don't Trust, Verify
Instead of Trusting someone who said they sent you crypto, you can Verify whether or not the transaction was completed.
F
Fear & Greed Index
Attempts to measure the mood of the crypto market.
G
Grayscale Bitcoin Trust (GBTC)
Grayscale Bitcoin Trust (GBTC) is an investment product that allows investors to gain exposure to Bitcoin through traditional financial markets without directly owning or managing Bitcoin.
GH/s
GH/s (gigahashes per second) measures how many cryptographic puzzles a mining machine solves each second, with one GH/s equaling one billion hashes.
H
Hash Ribbons
Tracks two moving averages of Bitcoin's hash rate to show when miners are feeling pressure.
L
LTH Supply
Long-Term Holder (LTH) Supply refers to the total amount of Bitcoin held by investors who have retained their assets for over 155 days, indicating a reduced likelihood of selling in the short term.
M
Mining Hardware (ASIC)
ASICs are specialized computers designed for mining bitcoin.
Mayer Multiple
The Mayer Multiple compares Bitcoin's current price to its 200-day moving average.
Mining Pool
Groups of cooperating miners that agree to share Bitcoin block rewards.
Mining
This is a complete guide to Bitcoin Mining. Learn everything you need to know about Bitcoin mining from this in-depth post.
MVRV-z Score
The MVRV-z Score is a tool that compares Bitcoin's current price to the average price at which it was last traded, helping to spot if the market might be overvalued or undervalued.
N
NGU (Number Go Up)
NGU (Number Go Up) refers to a fundamental characteristic of Bitcoin: that the price is almost always trending up.
Not Your Keys, Not Your Coin
When you have the private key you are responsible for and have complete control over the crypto contained in your wallet. By storing your coins on an exchange, you have to go through them for every transaction.
NUPL
NUPL, or Net Unrealized Profit/Loss, is like taking Bitcoin's temperature.
NVT (Network Value to Transactions)
Network Value to Transactions (NVT) measures Bitcoin's market value against its daily transaction volume.
O
Open Interest
Open interest in Bitcoin trading is a measure of how many active futures contracts are still open, indicating the number of participants in the market and providing insight into market momentum.
P
Pi Cycle Top
An indicator that tracks two Bitcoin moving averages.
Power Law
Model that suggests Bitcoin's price isn't random chaos, but follows a predictable pattern.
Puell Multiple
The Puell Multiple is a Bitcoin-specific indicator that compares daily miner revenue to its historical 365-day average, offering insights into market cycles and miner profitability.
R
RBF (Replace by Fee)
RBF stands for replace by fee, which involes creating a new transaction to replace an old one.
Realized Price
The average price tag on all bitcoins in circulation.
S
Satoshi
A Satoshi is the smallest unit of Bitcoin, equivalent to 0.00000001 BTC.
Seed Phrase
A seed phrase consists of a sequence of 12 to 24 words, generated using cryptographic algorithms.
SegWit
SegWit (Segregated Witness) is a Bitcoin upgrade that increases transaction capacity and fixes the transaction malleability bug by removing signature data from the main block.
Sharpe Ratio
The Sharpe ratio is a financial metric that measures the risk-adjusted return of an investment by comparing its performance to the risk-free rate and the volatility of its returns.
SOPR
SOPR stands for spent output profit ration, an on-chain indicator.
Stacking Sats
Stacking Sats means accumulating small units of Bitcoin, known as satoshis.
STH MVRV
Compares the current market value of Bitcoin held by short-term holders (less than 155 days) to the price they originally paid, indicating whether they are in profit or loss.
Stock to flow
Stock-to-Flow is a model used to assess the scarcity of an asset by examining its existing supply and the rate at which new supply is produced.
T
Transaction Time
Transaction time in Bitcoin refers to the amount of time until a transaction is confirmed.
U
User Activated Soft Fork (UASF)
UASF (User Activated Soft Fork) is a mechanism where the activation of a blockchain soft fork is enforced by full nodes, allowing users to initiate changes rather than relying on miners.
UTXO
A UTXO (Unspent Transaction Output) is a Bitcoin system that tracks unspent Bitcoin from transactions to ensure secure ownership transfers.
V
Virgin Bitcoin
Virgin Bitcoins are bitcoins that have never been spent. This means they are purchased directly from miners who mined the bitcoin directly.
W
Whale
A Bitcoin whale is an individual or organization that holds 1,000 BTC or more, capable of influencing market prices with their large trades due to the significant size of their holdings.