How to use the glossary and why these terms matter
The crypto exchange glossary is a dictionary of terms you meet when swapping coins: from blockchain and address to rate, fee and confirmations. Each term below starts with a short definition, followed by an explanation and an example. Most money lost during an exchange is linked not to hacks but to a misunderstanding of simple things: the token network, memo, the exact amount.
If you are exchanging for the first time, first read the step-by-step exchange guide, and come back to the glossary as a reference. The figures in the article are given as a guideline: in real networks they change.
Network and blockchain: blockchain, node, on-chain
Blockchain
Blockchain is a shared ledger of operations that is stored on many computers at the same time and recorded in blocks linked to one another. Changing an old record after the fact is practically impossible, so a mistaken transfer cannot be recalled on request. Example: Bitcoin, Ethereum and Tron are three different blockchains with their own rules.
Node
Node is a computer that stores a copy of the blockchain, checks new transactions and passes them on across the network. The more independent nodes there are, the harder it is to forge data. An ordinary user does not need their own node: wallets and services use other people's nodes.
On-chain
On-chain describes an operation that is recorded directly in the blockchain and visible in it. The opposite is a platform's internal bookkeeping, where a balance changes only in its database. A transfer from your wallet to a payment address is an on-chain operation, and it can be found in the open blockchain data.
Addresses and keys: address, public and private key, seed phrase
Address
Address is a string of characters to which coins are sent; it can be compared to an account number. An address can be safely shared with others. The format depends on the network: Bitcoin, Ethereum and Tron addresses look different, so an address from another network is usually rejected by the wallet or, worse, accepted and leads to a loss of funds. How to compare addresses is described in the article how to check a wallet address.
Public and private key
Private key is a secret number that gives the right to sign transfers from an address; the public key is calculated from it and is used to verify the signature. The address is derived from the public key. Whoever knows the private key fully controls the coins, so it must never be given to anyone.
Seed phrase
Seed phrase (also called a recovery phrase or mnemonic) is a set of 12 or 24 words from which a wallet restores all keys. If you lose the device but have kept the phrase, access will return. If an outsider learns the phrase, they will take everything. Detailed storage rules are collected in the material on wallet security.
Wallets: hot and cold, custodial and non-custodial
Hot wallet
Hot wallet is a wallet that is constantly connected to the internet: a mobile app, a browser extension, a program. It is convenient for frequent transfers, but it is more often the target of attacks and viruses.
Cold wallet
Cold wallet is a storage method in which the keys are never online: a hardware device or a phrase written down offline. It suits long-term storage but is less convenient for quick operations.
Custodial and non-custodial
A custodial wallet or account is one where a company holds the keys and you only have a user account; a non-custodial wallet is one where the keys and seed phrase are held only by you. In the first case you trust the platform with safekeeping, in the second you are responsible for it yourself. A balance on an exchange account is the exchange's obligation to you, not coins on your address.
Transactions: transaction, txid, confirmation, mempool
Transaction
Transaction is a signed command to the network to transfer a certain amount from one address to another. Once sent, it cannot be cancelled; you can only wait for it to be included in a block.
Txid
Txid (transaction hash, TxHash) is the unique identifier of a transfer by which it is found in the blockchain. It is the most precise receipt of an operation; when contacting support it is given together with the order number. How to look up a transfer is explained in the article on txid and the blockchain explorer.
Confirmation
Confirmation is each new block added after the block with your transaction. The more there are, the lower the chance that the record will be replaced. The required number depends on the network and the service, and the waiting time depends on how fast blocks appear; in Bitcoin a block appears roughly once every ten minutes. Networks are compared in the material on confirmation times.
Mempool
Mempool is the queue of unconfirmed transactions waiting to be included in a block. When the network is congested, thousands of entries accumulate in it, and transfers with a low fee wait longer. What to do if a transfer is stuck is described in the article on a stuck transaction.
Fees: network fee (gas) and service fee
Network fee
Network fee (in Ethereum, gas) is a payment to those who process transactions in the blockchain. It does not belong to the service and does not depend on it: the amount is determined by network load and your wallet. Example: a USDT transfer over ERC20 is usually more expensive than over TRC20, because the Ethereum network is more often congested.
Service fee
Service fee is the exchange service's or exchange's charge for the swap itself. Its size should be stated in advance, and the final amount to receive should be shown before the order is created. How the two fees add up is covered in detail in the article on the service and network fee.
Rate: exchange rate, spread, slippage
Exchange rate
Exchange rate is the amount of one coin you receive for a unit of another. It is taken from market quotes and changes constantly, so it is important to understand at what moment the rate is fixed.
Spread
Spread is the difference between the buying price and the selling price of an asset, and in exchange services, the difference between the market rate and the rate at which the swap is made. It is a hidden part of the cost that is not always called a fee. Platforms should be compared by the final amount in hand, not by the headline.
Slippage
Slippage is the deviation of the actual execution price from the expected one: while the order was being executed, the price shifted or there was not enough liquidity. It is typical for decentralized exchanges and large trades. More about how the price is formed is in the article on the exchange rate and spread.
Coins and networks: stablecoin, TRC20, ERC20, BEP20
Stablecoin
Stablecoin is a cryptocurrency whose price is pegged to another asset, most often the US dollar. USDT is the best-known example. The peg is maintained by the issuer and market mechanisms, so deviations are possible.
Token network: TRC20, ERC20, BEP20
Token network is the blockchain in which a specific version of a token is issued and transferred. TRC20 runs on the Tron network, ERC20 on Ethereum, BEP20 on BNB Smart Chain. The same USDT in different networks are different technical tokens; a transfer over the wrong network most often leads to a loss of funds. The choice of network is covered in the article which USDT network to choose, and the consequences of a mistake in the material on sending to the wrong network.
Memo and destination tag: when an extra identifier is needed
Memo (in XRP, destination tag) is an additional field that shows who within a shared address a payment belongs to. It is needed by networks and platforms where many customers use a single address. Without the correct memo the recipient may not find the payment. Example: an exchange issues a shared address and a unique memo for each customer.
If a memo is required, it must be copied as carefully as the address. Details are in the article on memo and destination tag.
Order and exchange modes: automatic and manual, refund address, underpayment, overpayment
Automatic and manual mode
Automatic mode is an exchange in which the system processes the request without an operator; manual mode is an exchange in which an operator reviews the request. The difference is in speed, procedure and cost; the differences are described in the article on automatic and manual exchange.
Refund address
Refund address is your address to which the service will send the funds if the exchange cannot be completed. It must belong to you and be in the network of the same coin you are paying with.
Underpayment and overpayment
Underpayment is a transfer smaller than the order amount; overpayment is a larger one. Both cases fall outside normal processing, since the rate and the result were calculated for a different amount. A breakdown is in the material on underpayment and overpayment.
Platforms: CEX, DEX, P2P, liquidity, explorer
CEX and DEX
CEX is a centralized exchange that is run by a company and holds customers' funds; DEX is a decentralized exchange that works through smart contracts, where you connect your own wallet. On a CEX you depend on the company's rules, on a DEX you are responsible for signatures and mistakes yourself.
P2P
P2P (peer-to-peer) is an exchange directly between two users, where the platform only helps find a counterparty and holds the funds for the duration of the deal. The main risks are a dishonest party and payment fraud. A comparison of formats is given in the article on an exchange service, an exchange and P2P.
Liquidity
Liquidity is the ability to quickly buy or sell an asset without a noticeable change in price. For a highly liquid pair the rate is more stable, and large amounts go through more easily.
Blockchain explorer
Blockchain explorer is a public website where you can look up a transaction, address or block and see the status, amount and number of confirmations. It shows what happened on the network, regardless of what any service says.
Checks: KYC and AML (definitions only)
KYC (Know Your Customer) is the procedure by which a financial or crypto organization establishes a customer's identity. AML (Anti-Money Laundering) is a set of rules and measures aimed at countering the laundering of criminal proceeds. Requirements depend on the country and the particular platform, so there is no universal answer.
These terms describe the obligations of organizations and do not mean a violation by the user. What an address risk assessment is and how to read it is explained in the article on AML address risk. For questions of law, consult a lawyer.
Security: 2FA, phishing, E2EE
2FA
2FA (two-factor authentication) is a login that requires not only a password but also a second factor: a code from an app or a hardware key. An authenticator app is more reliable than an SMS code, which can be intercepted.
Phishing
Phishing is deception in which you are made to enter a password or seed phrase, or to send money to a fake website or address. Typical signs: a similar-looking domain, urgency, a request to send the phrase for verification. More in the article on the signs of a fake exchange service.
E2EE
E2EE (end-to-end encryption) is a way of transmitting data in which only the sender and recipient read the message, and an intermediary sees only ciphertext. Example: messengers with end-to-end encryption. It protects the conversation but does not guarantee that the other party is who they claim to be.
Typical mistakes caused by not knowing the terms
- Confusing USDT networks and sending the token over the wrong protocol.
- Not specifying a memo or destination tag where it is mandatory.
- Sending an amount different from the one in the order because of the network fee being deducted.
- Treating an exchange balance as one's own coins on one's own address.
- Giving the seed phrase to a support employee.
- Calling a txid an order number and vice versa: they serve different purposes.
- Comparing platforms only by the size of the fee, forgetting about the spread.
Checklist before an exchange
- Check that you are on the service's official domain.
- Make sure the coin and network in the order match your wallet.
- Compare the recipient address by its beginning, end and middle.
- Add a memo or destination tag if one is required.
- Look at the final amount to receive before creating the order.
- Send the exact amount, taking the network fee into account.
- Save the order number, the link and the txid.
- Never tell anyone your seed phrase or private keys.
If you are ready to start an exchange, open the BITWHITE exchange form.
How these terms relate to exchanging on BITWHITE
In the exchange form you choose the coin you give and the coin you receive, the amount and the receiving address, and if needed you specify a memo or destination tag. BTC, LTC, ETH, SOL, BNB, TRX and USDT in the TRC20, ERC20 and BEP20 networks are supported; the exact list is shown in the form and may differ between modes. No registration is required.
The rate and the final amount to receive are visible before the order is created, and the rate is fixed at the moment of its creation. Automatic mode runs without an operator with a 1% fee, manual mode is reviewed by an operator, with a 1.5% fee. In automatic mode a refund address is specified. A payment address is issued for each order and is valid for up to 2 hours; you must send the exact amount in the selected network.
The payout arrives after the required number of network confirmations, which is shown in the order, and the txid is displayed there as well. In case of underpayment or a different amount, the order is passed to an operator for manual review. The service never asks for a seed phrase or private keys, and the only official domain is bitwhite.net.