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Crypto glossary
New to crypto? Here are the terms you will meet most, explained in plain English with a Pakistan angle where it matters. Bookmark this page and come back whenever a word is unfamiliar.
- Bitcoin (BTC)
- The first and largest cryptocurrency, launched in 2009. It runs on a public blockchain and is not issued or controlled by any government or bank.
- Blockchain
- A shared, tamper-resistant ledger that records every transaction across many computers, so no single party can secretly change the history.
- Wallet
- An app or device that stores the keys used to send and receive crypto. The wallet holds your keys, not the coins themselves, which live on the blockchain.
- Private key
- A secret code that proves ownership of your crypto and authorises spending. Anyone who has it controls the funds, so it must never be shared.
- Seed phrase
- A list of 12 or 24 words that can restore your entire wallet. Write it down offline and never type it into a website or share it with anyone.
- Cold wallet
- A wallet kept offline, such as a hardware device, so keys are never exposed to the internet. Considered the safest way to store larger amounts.
- Stablecoin
- A crypto designed to hold a steady value, usually pegged to the US dollar. Tether (USDT) is the most used stablecoin among Pakistani traders.
- USDT (Tether)
- The most widely used dollar stablecoin. In Pakistan it is commonly bought and sold on P2P markets and used to move value between exchanges.
- Altcoin
- Any cryptocurrency other than Bitcoin, for example Ethereum, Solana or XRP.
- Exchange
- A platform where you buy, sell and trade crypto. Some are global (Binance, Bybit) and access in Pakistan is often through P2P or the app.
- P2P (peer to peer)
- Buying or selling crypto directly with another person, with the exchange holding the crypto in escrow until payment is confirmed. The main on-ramp in Pakistan using JazzCash, Easypaisa or bank transfer.
- PVARA
- The Pakistan Virtual Assets Regulatory Authority, created under the Virtual Assets Act 2026 to license and regulate crypto businesses in Pakistan.
- KYC
- Know Your Customer: the identity checks (CNIC, selfie) an exchange runs before you can trade, required for anti-money-laundering rules.
- DeFi
- Decentralised finance: lending, borrowing and trading through smart contracts instead of a bank or company.
- Gas fee
- The network fee paid to process a transaction on a blockchain like Ethereum. It rises when the network is busy.
- Halving
- A scheduled event, roughly every four years, that cuts the reward for mining new Bitcoin in half, reducing how fast new supply is created.
- Market cap
- The total value of a coin, found by multiplying its price by the number of coins in circulation. Used to compare the size of different cryptocurrencies.
- Volatility
- How sharply a price moves up and down. Crypto is highly volatile, which means large gains and losses can happen quickly.
- Rug pull
- A scam where the creators of a token hype it, take investors' money and disappear, leaving the token worthless. Always research before buying.
- Zakat on crypto
- Most scholars treat crypto held for investment like other tradeable wealth: Zakat of 2.5% is due on its market value once it passes the nisab and is held for a lunar year.
Definitions are for general education and are not financial advice. Crypto assets are volatile and high risk.