Every crypto AMA is filled with buzzwords that sound impressive but often leave people scratching their heads. Here’s what these terms actually mean, stripped of the marketing speak.
1. “We’re Building the Infrastructure”
What they say: Revolutionary blockchain infrastructure for the future What it means: We’re creating basic technical components that other projects might use someday
2. “Decentralized Autonomous Organization (DAO)”
What they say: Community-governed organization with no central authority What it means: A voting system where token holders can propose and vote on decisions, though major decisions often still come from the core team
3. “Layer 2 Scaling Solution”
What they say: Revolutionary technology to solve blockchain scalability What it means: A separate network that processes transactions faster and cheaper than the main blockchain, then settles final results back to it
4. “Total Value Locked (TVL)”
What they say: Measure of our protocol’s massive success What it means: The dollar value of all cryptocurrency currently deposited in the protocol – can fluctuate wildly with market prices
5. “Cross-Chain Interoperability”
What they say: Seamless communication between all blockchains What it means: Trying to make different blockchain networks work together, usually through bridges (which have been frequently hacked)
6. “Yield Farming”
What they say: Innovative way to earn passive income What it means: Moving your crypto between different protocols to chase the highest interest rates, often involving significant risk
7. “Tokenomics”
What they say: Carefully designed economic model What it means: How many tokens exist, how they’re distributed, and what incentives are built in – often favoring early investors and team members
8. “Fair Launch”
What they say: No pre-mine, completely fair distribution What it means: Tokens weren’t created for the team beforehand, but early participants still usually get significant advantages
9. “Governance Token”
What they say: Democratic control over the protocol What it means: A token that lets you vote on proposals, but voting power is based on how many tokens you own (so wealth equals influence)
10. “Liquidity Mining”
What they say: Rewarding community participation What it means: Giving out tokens to people who provide liquidity to trading pools – essentially paying people to use your protocol
11. “Composability”
What they say: DeFi legos that work together seamlessly What it means: Different protocols can interact with each other, but this also means problems in one protocol can cascade to others
12. “Rugpull Resistant”
What they say: Built with safety mechanisms to protect users What it means: Trying to prevent developers from suddenly draining all funds and disappearing, but creative scammers often find new ways
13. “Community-Driven”
What they say: Entirely controlled by the community What it means: The community has some input, but key decisions and technical development are usually still controlled by the founding team
14. “Deflationary Mechanics”
What they say: Token burns make your investment more valuable What it means: Some tokens are permanently removed from circulation, but this doesn’t guarantee price increases if demand doesn’t keep up
15. “Multi-Chain Strategy”
What they say: Available everywhere for maximum accessibility What it means: Deploying on multiple blockchains to capture more users and liquidity, but also spreading development resources thin
16. “Real Yield”
What they say: Sustainable returns from actual revenue What it means: Profits that come from actual fees/usage rather than just printing new tokens – much rarer than claimed
17. “Web3 Native”
What they say: Built for the decentralized future What it means: Designed specifically for blockchain/crypto rather than adapting traditional models, though often just means “has tokens”
18. “Vampire Attack”
What they say: Competitive strategy to capture market share What it means: Offering high rewards to users of competing protocols to switch over, usually unsustainable long-term
19. “Protocol-Owned Liquidity”
What they say: Sustainable liquidity model What it means: The protocol owns its own trading liquidity instead of renting it from users, reducing dependency on external liquidity providers
20. “Permissionless Innovation”
What they say: Anyone can build without asking permission What it means: No gatekeepers control who can create applications on the protocol, but this also means no quality control or user protection
The Bottom Line
These buzzwords often describe legitimate concepts, but they’re frequently used to make projects sound more revolutionary than they are. When evaluating crypto projects:
- Look for concrete use cases and actual users
- Check if the team has delivered on previous promises
- Understand the real risks, not just the potential rewards
- Remember that complexity doesn’t always equal innovation
The crypto space moves fast and terminology evolves constantly, but understanding these core concepts will help you see through the marketing speak and make more informed decisions.
