The Ultimate Beginner’s NFT Glossary 101: 18 Terms You Should Know

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13 Apr 2022

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Let’s progress past your newbie stage.
In the past several months, I have had so much fun with NFTs. I am sure a lot of people are collecting NFTs like me for a better way of life.
However, sometimes the NFT terms we use are tough to understand. If you don’t know these terms, you are probably losing money.
One of the amazing things is that the NFTs industry is spawning its own slang at an amazing speed. Lots of communities have so many wild words that must be confusing to an outsider looking in. I know when I first got into the NFT space a couple of months ago none of these words made sense to me, and I am sure some people are in the same boat as me.
Now let me share with you some hot NFT terms so that you’re no longer confused. I believe that by the end of this article, you will completely understand most of the NFT jargon, and the most commonly used phrases.
Now the first term I am going to introduce of course is:

NFT (Non-Fungible Token)

NFT is a broad term that includes any form of tokenized digital assets, such as art, real estate, computer programs, photographs, music, videos, etc. It’s the real-life equivalent of collectibles, except they’re backed by the blockchain like cryptocurrencies. “Non-fungible” implies that NFTs are unique, even when they have the same appearance.

Airdrop (or Drop)

An airdrop is a crypto marketing strategy that works like a giveaway, but with a few differences. It’s a tactic that rewards users who meet certain conditions, such as following their media channels, buying their token, or joining a limited waitlist.
Airdrops typically offer variable rewards and involve upfront investing. If there’s no investment, it’s a giveaway.

DAO

In the NFT world, DAO refers to a Decentralized Autonomous Organization.
Many up-and-coming NFT and metaverse projects are setting up DAOs, in which the teams developing such spaces are not governed by one single person or entity.
The regulations and governance of each DAO are coded in smart contracts on the blockchain and cannot be changed unless voted upon by members of the DAO.
DAOs are funded through NFT sales, where holders of the NFTs can decide how to use the treasury and their future project direction.

Diamond Hands/Paper Hands

Commonly depicted in its emoji form (see below), ‘diamond hands’ refers to someone who has a high-risk tolerance for high volatility stocks or assets that they own. They don’t cave under pressure and sell their stocks, essentially.
No matter how dramatically the value of their NFT increases or decreases, Diamond Hands don’t sell their assets in panic. However, there’s also a negative connotation of Diamond Hands, referring to a stubborn investor who isn’t willing to let go of their NFT despite its falling value.
On the other hand (mind the pun), Paper Hands is the opposite of Diamond Hands. It refers to someone who sells or flips their assets too soon, without holding on to them for the long term.

Flipping

Used frequently in the context of buying and selling properties, flipping refers to buying items at low prices and selling them quickly for a profit.
In the NFT space, flipping means the same thing, where people buy and sell NFTs to make a quick profit, especially during the early stages of projects when there is higher demand.

FOMO

Fear of missing out is the feeling of apprehension that one is either not in the know or missing out on information, events, experiences, or life decisions that could make one’s life better.

Generative Art

Generative art is the method used by popular NFT projects such as the Bored Ape Yacht Club, CryptoPunks, Pudgy Penguins, PhantaBear, and even local ones like Chapfans, and more, to create their collections.

Gas

Gas is a fee one needs to pay to a blockchain network to perform all kinds of transactions. This fee is paid to the “miners” of a blockchain network to compensate for the computing energy required to process and validate transactions. Gas fees differ from network to network, and are volatile.

OG

OG stands for “original,” and it’s a common prefix for blue-chip NFTs that have many similar collections. Some are derivatives, but most are knock-offs. For example, the Bored Ape Yacht Club owns the OG “BAYC.” Non-originals are:
OG collections have the verified icon on OS.

PFP

Also known as avatars, profile pictures (PFPs) are the most popular NFT art. Bored Ape Yacht Club and CryptoPunks are PFP examples. Creators use generative art to create hundreds of characters and trait combinations. Some traits may have a lower chance to appear, which make some PFPs more valuable. Each trait has a different drop chance, with the rarest ones being the most valuable.

Roadmap

An NFT Roadmap is a document that maps out the goals and strategies of an NFT project to communicate its long-term value. NFT roadmaps usually include key project milestones, short and long-term goals, and plans for marketing and growth.
Sometimes, they even include other projects that the creators are planning to launch.

Shilling

Shilling is when you encourage others to buy an NFT you own for more than you paid — even if that means lying. It’s not value-selling; it’s an exit scam.
Shilling is common among flippers, influencers, and pump-and-dump groups. Creators may also do it before a rug pull. Shilling always involves optimism and urgency to discourage critical thinking.

Secondary Market

After an NFT is minted, it can be sold or purchased on the secondary market, such as OpenSea and Nswap.

Traits

Traits are all the properties that make an NFT unique in its collection. While most traits are visuals (background, color, accessories).
This is why you can’t find two identical PFPs within the same collection. Traits also add scarcity: You can only create as many NFT combinations as you can make.

Web 3.0

Web 3.0 is the third iteration of the Internet, a network of decentralized applications (dApps) running on different blockchains. It is built using artificial intelligence, machine learning and the semantic web, and uses the blockchain to keep your information secure.

Whale

A “whale” describes someone with a lot of money who’s able to invest or has already invested in a high-value NFT project.
Whales tend to have a following from others who may use their buying and selling decisions as an indicator of their future investment decisions.

To the Moon

Someone who says “token XYZ to the moon” is confident that a coin they have bought will skyrocket in price. Not just 2X or 10X, but high enough to make life-changing money. It’s believing the price will go up exponentially if they hold for long enough.
“Bitcoin to the Moon!” shows bullish excitement.

Whitelist (WL Spots)

If an NFT collection is very anticipated, it may sell out within minutes after the mint.
Whitelists give early followers an opportunity to get them first. And unlike airdrops, they are free to join.
For example, a creator might give away one hundred WL spots to random people following them on social media. So collections instead have a mini-game where only the best players earn a spot on the whitelist.
If you have any questions and any other terms that I have left out make sure to leave them in a comment.
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Peace. See ya.
About NSWAP, Inc.: NSWAP, Inc. is building a decentralized, multi-chain information aggregation platform (Launchpad) and open market (Marketplace) for NFTs. NSWAP, Inc. gives everyone the opportunity to experience, access, and own NFTs. With Nswap, users can access NFT collections for sale on its primary Launchpad and trade them freely on its secondary Marketplace.