# NFT Glossary: 53 Terms Explained in Plain English > Every NFT, Web3 and blockchain term you’ll encounter, defined plainly — from address and approval to wash trading and soulbound tokens. Source: https://thenftacademy.com/glossary Site: The NFT Academy (https://thenftacademy.com) --- 53 terms ## Every term, in *plain* English. Each definition stands on its own — you shouldn’t need to read the one above it first. Where a term deserves more than a paragraph, there’s a link to the guide that gives it one. Address · Basics A public identifier for an account on a blockchain, usually a long hexadecimal string. Safe to share — it’s what people send assets to. Knowing someone's address doesn’t let you move their assets. Airdrop · Basics Tokens sent to wallets without the recipient asking. Sometimes a genuine distribution to existing holders; frequently bait leading to a phishing site. [Read more about Airdrop](https://thenftacademy.com/learn/nft-scams-and-red-flags) Allowlist · Culture A list of addresses permitted to mint before or instead of the general public. Formerly called a whitelist. Valuable when demand exceeds supply, and meaningless when it doesn’t. Approval · Security Permission granted to a contract to move tokens on your behalf. Required for marketplace listings, persists until revoked, and is the mechanism behind most NFT theft. [Read more about Approval](https://thenftacademy.com/learn/how-to-store-nfts-safely) Arweave · Technical A storage network where you pay once for storage intended to be permanent. Used for NFT metadata and artwork as a durable alternative to ordinary web hosting. Bags · Culture Slang for the assets someone holds. "Holding bags" implies holding something that has fallen in value. Blockchain · Basics A shared, append-only ledger maintained by many independent computers, where no single party can alter past entries. The database NFTs live in. [Read more about Blockchain](https://thenftacademy.com/learn/what-are-nfts) Blue chip · Trading A collection considered established enough to retain value through a downturn. A relative term, and one that proved less durable than it sounded. Burn · Technical Permanently destroying a token by sending it to an address nobody controls, or calling a burn function. The transaction history remains on-chain. Cold wallet · Security A wallet whose private keys are kept offline, usually on dedicated hardware. Used for holding assets rather than browsing. [Read more about Cold wallet](https://thenftacademy.com/compare/crypto-wallets) Collection · Basics A set of NFTs from the same contract, usually sharing a theme and trait system. What people mean by "a project". Contract address · Technical The address where a smart contract is deployed. The only reliable way to verify a collection is genuine, since names and artwork are trivially copied. [Read more about Contract address](https://thenftacademy.com/learn/how-to-buy-nfts) DAO · Culture Decentralised Autonomous Organisation. A group coordinating through token-based voting and a treasury held in a contract. In practice, governance participation is usually low and voting power concentrated. dApp · Technical Decentralised application. A front end that interacts with smart contracts rather than a company's server. [Read more about dApp](https://thenftacademy.com/learn/web3-explained) Diamond hands · Culture Slang for holding through volatility rather than selling. Framed as a virtue, and in practice indistinguishable from being unable to sell. ERC-1155 · Technical A multi-token standard where one contract manages both unique items and quantities of identical ones. More efficient for games, which need both. ERC-721 · Technical The Ethereum standard for non-fungible tokens, where every token is unique and individually tracked. What most NFT collections use. [Read more about ERC-721](https://thenftacademy.com/learn/smart-contracts-explained) Ethereum · Basics The blockchain where most NFT activity originated, and the first to support general-purpose smart contracts. EVM · Technical Ethereum Virtual Machine. The runtime that executes smart contracts. Chains that implement it, Polygon, Base, Arbitrum, can run the same contracts. Floor price · Trading The lowest listed price in a collection. Widely quoted and frequently misleading, since a listing isn’t a sale — a floor with no trades behind it is a number someone typed. Fungible · Basics Interchangeable. Any dollar is as good as any other dollar. NFTs are non-fungible: each one is distinct. [Read more about Fungible](https://thenftacademy.com/learn/what-are-nfts) Gas · Technical The fee paid to a network to process a transaction. Charged whether or not the transaction succeeds, which is how people lose money on failed mints. [Read more about Gas](https://thenftacademy.com/tools/gas-fee-estimator) Gas war · Trading Competition to get a transaction included during a popular mint, bidding gas prices up sharply. Usually a contest against automated bidders that a human loses while still paying. Generative art · Culture Artwork produced by an algorithm, often with the output determined at mint time. One of the few categories where storing work fully on-chain is practical. Gwei · Technical One billionth of an ETH. The unit gas prices are quoted in. Hot wallet · Security A wallet whose keys are stored on an internet-connected device. Convenient for browsing and exposed to anything that compromises that device. [Read more about Hot wallet](https://thenftacademy.com/compare/crypto-wallets) IPFS · Technical InterPlanetary File System. Content-addressed distributed storage, where an address is derived from the content itself. The sensible default for NFT metadata. Layer 2 · Technical A network that processes transactions off the main chain and settles to it, cutting costs by orders of magnitude. Base, Arbitrum, Optimism and Polygon are the main examples. Liquidity · Trading How readily an asset can be sold near its quoted price. The single most under-appreciated risk in NFTs, where most collections have very little of it. Metadata · Technical The file describing a token — name, description, image link, traits. Usually stored off-chain, which is why where it lives determines whether the artwork survives. [Read more about Metadata](https://thenftacademy.com/learn/what-are-nfts) Mint · Basics Creating a new token by writing it onto a blockchain. Minting publishes the object; it doesn’t create demand for it. [Read more about Mint](https://thenftacademy.com/learn/how-to-create-an-nft) NFT · Basics Non-fungible token. A unique entry in a public ledger recording which address controls a particular item. [Read more about NFT](https://thenftacademy.com/learn/what-are-nfts) Oracle · Technical A service that brings off-chain data onto a blockchain so contracts can act on it. The point at which a decentralised system acquires a centralised dependency. [Read more about Oracle](https://thenftacademy.com/learn/smart-contracts-explained) PFP · Culture Profile picture. A collection designed to be used as an avatar, typically thousands of algorithmically varied images. The dominant format of the 2021 boom. Private key · Security The secret that authorises transactions from an address. Whoever has it controls the assets, permanently and without recourse. [Read more about Private key](https://thenftacademy.com/learn/how-to-store-nfts-safely) Proof of stake · Technical A consensus mechanism where validators stake capital rather than expending computation. Ethereum's move to it cut its energy use by more than 99%. Rarity · Trading How uncommon a token's traits are within its collection. Influences price within a collection, and says nothing about whether the collection itself is worth anything. Recovery phrase · Security Twelve or twenty-four words from which every key in a wallet is derived. It’s the wallet. Never type it into any website, for any reason. [Read more about Recovery phrase](https://thenftacademy.com/learn/how-to-store-nfts-safely) Reveal · Culture The moment after a mint when artwork and traits become visible. Before reveal, buyers are purchasing an unknown item from the collection. Royalty · Trading A percentage of secondary sales intended for the creator. Never enforced by the blockchain, made optional by several marketplaces, and frequently not paid. [Read more about Royalty](https://thenftacademy.com/learn/nft-royalties-explained) Rug pull · Security A project that raises money on promises and then abandons them. The tell is usually anonymity plus heavy promises plus no verifiable track record. [Read more about Rug pull](https://thenftacademy.com/learn/nft-scams-and-red-flags) Secondary market · Trading Trading between collectors after the initial mint, as opposed to the primary sale from the creator. setApprovalForAll · Security A contract function granting an operator permission over every token you hold in a collection. Legitimate for marketplace listings, and the mechanism behind most NFT theft. [Read more about setApprovalForAll](https://thenftacademy.com/learn/nft-scams-and-red-flags) Smart contract · Technical A program stored on a blockchain that runs identically for everyone and can’t be altered after deployment. Not smart, and not a contract. [Read more about Smart contract](https://thenftacademy.com/learn/smart-contracts-explained) Soulbound · Technical A token permanently bound to one address and not transferable. Proposed for credentials, where sellability would defeat the purpose. Sweep · Trading Buying multiple items from a collection at once, usually the cheapest listings. Sometimes used to move a floor price deliberately. Testnet · Technical A parallel network using valueless tokens, used for testing before deploying to a live chain. Sepolia is the main Ethereum testnet. Token ID · Technical The number identifying a specific token within its contract. Together with the contract address, it uniquely identifies any NFT. Utility · Basics Something a token does beyond existing — access, an in-game item, a credential. Distinguished from value resting purely on future resale. [Read more about Utility](https://thenftacademy.com/learn/nft-utility-and-gaming) Wallet · Basics Software or hardware holding the private keys that control your assets. Your NFTs aren’t in it — they’re on the blockchain; the wallet holds the key to them. [Read more about Wallet](https://thenftacademy.com/compare/crypto-wallets) Wash trading · Trading Trading an asset between wallets you control to manufacture volume and price history. Makes a collection look active when it isn’t. [Read more about Wash trading](https://thenftacademy.com/learn/nft-scams-and-red-flags) Web3 · Basics A proposed way of building applications where users hold their own accounts and assets rather than a company holding them. Part technical description, part marketing. [Read more about Web3](https://thenftacademy.com/learn/web3-explained) Whale · Trading A holder large enough that their buying or selling moves the market. In thin NFT collections, this can be a single individual. ### Terms people ask about most ##### What does NFT stand for? Non-fungible token. Fungible means interchangeable, the way any dollar is as good as any other. Non-fungible means each unit is distinct. A token is an entry on a blockchain representing something. So an NFT is an individually tracked entry in a shared public ledger. [The full explanation is here](https://thenftacademy.com/learn/what-are-nfts). ##### What is the difference between ERC-721 and ERC-1155? ERC-721 gives every token its own unique ID, which suits one-of-one art and profile pictures. ERC-1155 lets a single contract hold many token types at once, including quantities of identical items, which suits game assets and event tickets. [Both are covered in the smart contracts guide](https://thenftacademy.com/learn/smart-contracts-explained). ##### What is gas, in plain terms? Gas is the computation your transaction asks the network to perform, counted in gas units, multiplied by a price you bid in gwei. Sending ETH costs exactly 21,000 gas units. The units are predictable; the gwei price is an auction and moves minute to minute. [The estimator shows what that costs](https://thenftacademy.com/tools/gas-fee-estimator). ##### What is a seed phrase, and why does it matter so much? A seed phrase is the twelve or twenty-four words that regenerate a wallet’s private keys. Anyone holding it controls everything in the wallet, permanently and irreversibly. It should be written on paper or steel, never photographed, never stored in a note field, and never typed into any website for any reason. [More on storage here](https://thenftacademy.com/learn/how-to-store-nfts-safely).