Crypto glossary: plain meanings of bitcoin and crypto terms

The first widely used crypto asset, which runs on its own public blockchain with no central issuer.

A shared digital ledger that records transactions in linked blocks. Copies are held by many computers, so past entries are very hard to change.

A digital representation of value or rights that uses cryptography and a distributed ledger such as a blockchain. Bitcoin, ether and stablecoins are all crypto assets.

Money issued by a government, such as the euro. Crypto assets are not legal tender in Ireland.

A crypto asset designed to keep a steady value against another asset, often the US dollar. Stable does not mean safe: it depends on the issuer and its reserves.

A unit of a crypto asset. The word often means an asset that runs on another blockchain rather than its own.

A wallet that keeps private keys offline, such as a hardware wallet. It is harder to hack remotely but can be lost or damaged.

A wallet where a platform holds the private keys for you. If the platform fails or is hacked, you may lose access to your crypto.

A small physical device that stores private keys offline and signs transactions without exposing the keys to your computer.

A wallet connected to the internet, such as a phone app or browser extension. It is convenient for frequent use but more exposed to hacking.

The secret code that controls the crypto in a wallet. Anyone who has it can move the funds, and losing it usually means losing the crypto.

The string of characters you share so others can send crypto to your wallet. It is safe to share, unlike the private key.

A list of words that can restore a wallet and its private keys on a new device. Anyone who sees it can take your crypto, so never type it into a website or share it.

Holding your own private keys instead of leaving crypto on a platform. You keep control, but nobody can recover the funds if you lose the keys.

Crypto tokens sent to wallets for free, often to promote a new project. Unexpected airdrops can also be part of a scam.

Financial services such as lending, borrowing and trading that run on smart contracts instead of through a bank or broker.

A platform where you buy, sell or swap crypto assets for money or other crypto. Exchanges set their own fees, spreads and withdrawal rules.

The network fee paid to process a transaction on a blockchain such as Ethereum. It changes with how busy the network is.

A pot of tokens locked in a smart contract so others can trade against it. People who add tokens may earn fees but also face losses if prices move.

Code on a blockchain that runs automatically when set conditions are met. Bugs in the code can lead to lost funds.

The gap between the price a platform buys at and the price it sells at. It is a cost on top of any stated fee.

Locking crypto to help validate transactions on a proof of stake blockchain in return for rewards. Staked crypto may be locked for a period and can lose value.

Exchanging one crypto asset directly for another, on an exchange or through a DeFi app.

A token on one blockchain that represents an asset from another, such as wrapped bitcoin on Ethereum. It depends on the custodian or bridge that holds the original.

Costs you can deduct from the sale price when working out a gain, such as fees paid when you acquired and disposed of the asset.

Losses on disposals that reduce your taxable gains. Revenue says losses are set against gains in the same year first, and any unused loss is carried forward.

The tax on a gain when you dispose of an asset. Revenue applies the ordinary tax rules to crypto, and for most people a gain is subject to CGT.

The difference between what you received for an asset and what you paid for it plus allowable expenses. CGT is applied to this gain, not the whole amount you receive.

Any event that ends your ownership of an asset for tax. For crypto, selling, swapping or spending it is a disposal.

The price an asset would get on the open market. Revenue says you use it instead of the sale price in some cases, such as when you gift an asset to someone other than your spouse or civil partner.

The amount of chargeable gains each individual can make in a tax year before any CGT is due. Revenue sets the amount on its CGT pages.

The form you file to report gains. Revenue says you must file a return if you disposed of an asset, even if there is no tax due.

The Irish authority for authorising and supervising firms under MiCA. Its register lets you check whether a firm is authorised.

A firm authorised under MiCA to provide crypto services such as custody, running a trading platform or exchanging crypto for money. CASPs need authorisation to operate in the EU.

EU tax rules under which crypto providers collect information about users and their transactions and report it to tax authorities. It does not change how crypto is taxed.

The EU Markets in Crypto-Assets Regulation, which sets rules for issuing crypto assets, holding them for clients and running crypto trading platforms and exchanges.

A fake message or website that tries to get your password, private key or recovery phrase. Scammers often pose as an exchange, a wallet maker or Revenue.

A scam where the people behind a crypto project take investors' money and disappear, often after promoting the token heavily.