There are a lot of new words and abbreviations out there when you start to learn about web3, NFTs, crypto, blockchain, DAOs, and more.
Jumping into the crypto world already means learning about lots of new of tech and new ways of thinking about money, community, art, creators, and ownership.
Adding in a whole strange vocabulary can be particularly overwhelming. Since helping people get started or explore a new part of collecting NFTs and crypto is what we care about, we’re going to cover some of the most common terms you’ll come across in this part of the internet.
NOTE: We’ll add terms to this over time and do our best to keep things up-to-date. The last time this list was updated was 7/22/22.
Auction – This is where a smart contract has functions to open an auction-style sale of a token or vault. It usually has a reserve price, time limit, and minimum bid increase. You’ll also often see an automatic time limit increase from the last bid so a bid doesn’t sneak in at the last second without giving others a chance to respond.
For our Vaults, auctions unlock the Vault and transfer full ownership of the NFTs inside to the winner. Fraction holders claim their share of the sale based on how many tokens they held and all ERC-20 tokens are burned.
Blue Chip – A project or token that’s known and trusted by most people in the crypto space, typically seen as more stable. CryptoPunks and BoredApes are examples of blue chip NFTs.
Burn – The act of permanently removing a token or NFT from the blockchain. This typically increases the value of other tokens in a contract because there is less in circulation.
Custodian – The person responsible for keeping and maintaining assets for an organization.
DAO – Decentralized Autonomous Organization. A group that is governed by an agreed-upon set of rules, recorded on the blockchain with a smart contract.
Diamond Hands – A term used for someone holding a token or other crypto assets no matter what market shifts or volatility are happening.
Discord – A community platform where many crypto groups meet to discuss information, new projects, and more. Groups may be public, private, or a mix of both. Finding the right groups is a great way to learn more about web3. (Join our Discord community here!)
ETH – The token for the Ethereum blockchain. One of the well-known crypto tokens.
Ethereum – A blockchain. It has the ability to hold smart contracts and is the most common blockchain for NFT projects. Uses ETH tokens for transactions.
Fiat – Traditional government-issued currency that is not backed by a commodity like gold or silver. Examples include the USD, Euro, and Yuan.
Floor Price – The lowest price for an NFT in a particular collection or project. If someone “buys the floor,” they picked up one of the NFTs from the project at the cheapest price.
Fractional NFTs – NFTs that have been locked into a Vault or locker, then the ownership is split up using ERC-20 tokens (usually called Fractions, in these cases). This allows sellers to sell a percentage of the original assets and buyers to purchase less than the full amount. It also creates a fungible token for something that was originally non-fungible.
Fungible – when two things are interchangeable and of equal value, like dollar bills, ETH, or ERC-20 tokens (including our Fractions in a Vault).
Gas – Fees that are charged with each blockchain transaction. The amount varies based on the chain, how many other transactions are being sent, and how much computation time and power the transaction takes.
KYC – The acronym for “know your customer.” For projects that require more oversight or need to adhere to regulations, it’s a process that allows them to verify user identities. It involves gathering personal information and government IDs of some kind.
Liquidity – When a particular token or coin is able to be easily converted for fiat or other tokens or coins.
MATIC – The token for the Polygon blockchain. A well-known token, but typically of much lower value than others like Bitcoin or ETH. This also allows for much lower gas fees, usually.
Metadata – This is the underlying data that accompanies an NFT to define what it includes and how it is presented, visually or otherwise. It can be stored on or off-chain.
MetaMask – A crypto wallet that connects easily with many NFT and other crypto apps. You’ll want to download the Chrome extension and the mobile app to use with Mooned Mints and others!
Multisig – This is a shortened form of the term “multi-signature.” It means more than one signature is required for an action on the blockchain to be approved, which creates a deeper layer of security. It’s often used in a group setting, like a DAO, to make sure no one person has sole control of approvals.
NFTs – Non-Fungible Tokens, or unique digital assets on the blockchain that cannot be copied. This identification means you can be sure that you’re the only owner of your NFT and not some reproduction, and it’s tracked on the blockchain so you can follow the trail back to the creator. NFTs use the ERC-721 or ERC-1155 token standards.
Non-Fungible – A one-of-a-kind thing or asset. Its value is specific to it, and it can’t be equally interchanged with another thing or asset.
OS – A common abbreviation for OpenSea. OpenSea is the most well-known NFT marketplace and most of their transactions have historically been on the Ethereum blockchain. OpenSea also supports Polygon, Klaytn, and Solana.
Polygon – A common blockchain. It uses an Ethereum-compatible protocol, which makes it a good choice when NFT and other typically Ethereum-based projects want to lower prices and gas fees. The token associated with the chain is MATIC.
Reserve Price – Each token holder can vote to set the minimum price a token holder would like to receive per token. Those reserve price votes are averaged and then multiplied by the token number of Fractions to set the Reserve Package Price.
Roadmap – This is the plan for development and growth that the leaders of a project share with their audience. A clear roadmap is usually seen as a sign that there is a big picture view, that the project is more likely to be sustainable and grow in new ways past the initial launch, and the leaders have some experience in the space (but buyers should keep it’s not binding or guaranteed).
Rug Pull – The fraudulent act of tricking NFT investors into purchasing what looks like a long-term investment project, followed by taking all the investments and shutting down the company, leaving investors with nothing. Always be careful in looking for rug pulls. It can help if you look for things like audits, community involvement, and if the owner or team is known (aka doxxed).
Smart Contract – Digital contracts that are deployed on the blockchain and are self-executing. That means that they have functions that are coded using smart contract programming languages like Solidity, and are able to be interacted with to trigger different things.
Treasury – This is the wallet that is set in a smart contract to receive certain payments like initial crowd sale purchases, percent fees on secondary sales, or curator fees. It also may pay out certain wallets, like artists or Fraction holders after an auction sale.
Utility – The list of perks that come with ownership of an NFT that builds value. For example, one VeeFriend NFT has a utility that allows the owner to sit courtside at an NBA game with Gary V himself.
Vault – A Mooned Mints Vault is a round-up of NFTs that are locked together with a smart contract. Then ERC-20 tokens are created to fractionalize the Vault and allow people like you to buy portions of ownership of the whole round up. (Check out the Vaults!)
Vote – Many smart contracts include governance functions, which allow token holders the ability to vote on things that happen to the smart contract and its assets. An example with Mooned Mints Vaults is when our Fraction holders vote to set their reserve price
Wallet – a digital tool that crypto holders use to store, access, and manage their assets. They can be “cold” (a physical storage method or device that’s not connected to the internet) or “hot” (connected to the internet). Cold wallets are seen as more secure, while hot wallets are usually more convenient. Most crypto holders have a mix of wallets they use in their strategy.
Ready to check out some Vaults and grab some Fractions?
Head on over to look at what’s listed and what’s coming soon! And make sure to come say hi in the community and ask us any questions you may have.