Understanding Web3 Terminology

The NFT and Web3 space is filled with lots of jargon that can be hard to follow if you are learning about the space for the first time. Below you can find some frequently used Web3 terms and basic definitions that should help demystify the space.

Airdrop is the term for NFTs that are transferred to a wallet without the wallet owner paying for them. Some NFT projects reward NFT holders by giving them something new via an airdrop. This has also become a way for spammers to NFTs to a wallet, similar to getting email spam.

Ape In is a term that means making your first purchase of an NFT in a collection. It has become less common recently.

Burning an NFT is equivalent to destroying it. This is typically done by sending the NFT to an agreed upon unused blockchain address. Some people burn the spam NFTs they receive (see Airdrop above) to get rid of them. Some NFTs are intentionally burned to reduce the overall collection supply.

DAO is the acronym for a Decentralized Autonomous Organization, which is a new type of legal structure lacking a central governing body, but with a membership who share a common goal. It’s become a common approach for cryptocurrency communities and NFT projects to make decisions. The power structure within a DAO is typically spread across the token holders, with the simplest form being that each token gets one vote, so a holder with 5 tokens would get 5 votes, whereas a holder with only 1 token gets a single vote.

DYOR or Do Your Own Research is the disclaimer people in the Web3 space use to avoid offering advice that may turn out to be detrimental. While it’s important to do your own risk assessment before buying into any project, at some point we also need trust signals for the space to evolve.

Floor Price is the lowest secondary market “buy now” price for an NFT in a collection. If you’ve ever purchased concert tickets on a market like Stubhub, the floor price is the cheap seats at the time you were buying.

Gas is the term for fees paid when executing a transaction on the Ethereum blockchain. The closest analog is probably a credit card processing fee.

HODL or Hold on for Dear Life is a Web3 term for holding NFTs instead of selling them. It’s an intentional misspelling of ‘hold’ to reflect market volatility.

NFA is shorthand for ‘Not Financial Advice’ and frequently a way for someone talking about an NFT project they are interested in to put a disclaimer on their comments as a hedge in case the project doesn’t do well.

NFT a Non-fungible token is a certification of uniqueness stored on a blockchain that can represent any digital or physical asset.

NGMI or Not Going to Make It is a reference to speculators in the NFT space who either sell at a loss, sell to early before a project dramatically increases in value, or miss out on an opportunity that other speculators view as lucrative.

P2E is shorthand for ‘Play to Earn’ which is a segment of Web3 games where you can earn tokens for playing the game.

PFP Profile pictures are NFTs frequently used as social media avatars. Bored Ape Yacht Club, Deadfellaz, Cool Cats, and Doodles are all examples of this type of NFT. These are often created in collections of 3k-10k and share a set of common traits.

Rarity refers to the perceived level of uniqueness of an NFT within a collection. This is generally specific to PFP collections where an extremely rare NFT in the collection may be the only one with a specific combination of traits or the only NFT with a trait. It is typically determined mathematically as part of the collection creation process prior to minting.

Rug Pull is the term for projects that collect money from buyers and then abandon the project.

Sniping is a term that originates from online auctions where someone tries to win an auction right before the time runs out. In NFT terms it means getting a deal by buying something you perceive to be of higher value at an unexpectedly low price.

Sweeping the Floor refers to buying all the NFTs in a specific project that are available at the ‘buy now’ floor price.

WGMI or We’re Going to Make It is the opposite of NGMI. It’s frequently used when a project is performing well in the speculative market or as a way to express positive sentiment about the overall NFT market as a whole.