Crypto has a vocabulary problem. Exchanges, YouTubers and Telegram groups throw around words like spread, escrow and seed phrase as if everyone was born knowing them. This page is the reference behind the little dotted-underline tooltips you see across CryptoKenya: tap any of those words on another page and you land here for the longer version.
We grouped the terms by what you are trying to do — buying, trading, using P2P with M-Pesa, keeping coins safe, moving them between networks, and the Kenyan legal and tax words you will meet on KRA or CBK documents. Each entry starts with a one-line definition and, where it helps, adds a Kenyan example.
Basics
- Airdrop
Free tokens handed out to promote a project. Many "airdrops" shared on Telegram are scams that ask for your seed phrase.
- Altcoin
Any cryptocurrency other than Bitcoin.
- Blockchain
A shared public record of transactions that many computers keep identical copies of, so no single company can quietly edit it.
Think of it as an M-Pesa statement that thousands of independent computers keep in sync. New pages ("blocks") are added in order and linked to the previous one, which makes old entries very hard to change.
- Cryptocurrency
Digital money that lives on a blockchain instead of in a bank or M-Pesa account.
- Fiat money
Government-issued money such as the Kenya shilling (KES) or the US dollar.
- Halving
An event roughly every four years that cuts the new bitcoin reward for miners in half.
- Mainnet
The live blockchain where coins have real value, as opposed to a test network.
- Mining
Using computers to secure the Bitcoin network in exchange for newly created bitcoin and fees.
- Stablecoin
A crypto token designed to stay at a fixed value, usually 1 US dollar. USDT and USDC are the best known.
Kenyans use stablecoins to hold dollar value on a phone, to receive payments from abroad and to pay foreign suppliers. The peg depends on the issuer actually holding the reserves it claims.
- Token
A crypto asset that runs on top of another blockchain, for example USDT on the TRON network.
- USDT (Tether)
The most traded US-dollar stablecoin. On Kenyan P2P markets it is the main coin swapped for KES.
Trading and prices
- CFD
Contract for difference: a bet on the price of an asset without owning it. Crypto CFDs on forex platforms do not give you real coins.
- DEX
Decentralised exchange: a smart contract that swaps tokens directly from your own wallet, with no company holding your coins.
- Exchange (CEX)
A company that matches buyers and sellers of crypto and holds funds on their behalf, like Binance or CEX.IO.
- Limit order
Buy or sell only at a price you set. It may never fill if the market does not reach your price.
- Liquidity
How easily you can buy or sell without moving the price. High liquidity means tighter spreads.
- Maker / taker fee
Exchanges charge less to "makers" who place orders that wait in the order book, and more to "takers" who fill existing orders instantly.
- Market cap
Price of one coin multiplied by the number of coins in circulation. A rough measure of size, not of safety.
- Market order
Buy or sell immediately at the best available price. Fast, but exposed to slippage.
- Markup
Extra margin added on top of the market rate by a broker or P2P seller. It is a fee even when the app says "zero fees".
- On-ramp / off-ramp
An on-ramp turns KES into crypto; an off-ramp turns crypto back into KES on M-Pesa or in a bank.
- Order book
The live list of buy and sell orders on an exchange, showing how much people want to trade at each price.
- Proof of reserves
A report in which an exchange shows it holds customer assets 1:1. Useful, but it does not prove the exchange has no hidden debts.
- Slippage
The difference between the price you expected and the price you actually got, because the market moved while your order was filling.
- Spread
The gap between the buying price and the selling price. If USDT sells at KSh 131 and buys at KSh 128, the spread is KSh 3.
On P2P markets the spread is often the biggest hidden cost — larger than any fee shown on the screen.
- Staking
Locking coins to help run a proof-of-stake network in return for rewards. Platforms that offer it can also lose or freeze the coins.
P2P and M-Pesa
- Appeal (dispute)
Asking the P2P platform's support team to step in when a trade goes wrong. They review chat, receipts and M-Pesa messages.
- Arbitrage
Buying where a price is low and selling where it is higher at the same time. On P2P the margin is often eaten by fees and fraud risk.
- P2P escrow
The platform locks the seller's coins while you pay. Coins are released only when the seller confirms your M-Pesa payment arrived.
Escrow protects the buyer from a seller who takes the money and disappears. It does not protect the seller from a buyer who later reverses an M-Pesa payment — see our M-Pesa reversal guide.
- P2P trading
Peer-to-peer: you buy crypto directly from another person and pay them via M-Pesa or bank; the platform only holds the coins in escrow.
- Payment window
The time limit (often 15 minutes) a P2P buyer has to send M-Pesa and mark the order as paid before it is cancelled.
- Third-party payment
Paying from an M-Pesa line or bank account that is not in your own name. P2P rules forbid it and it is a common cause of frozen accounts.
- Verified merchant
A P2P trader who passed extra checks and posts many ads. Usually faster and safer than a brand-new account, but still not risk-free.
Wallets and security
- 2FA
Two-factor authentication: a second code from an app like Google Authenticator. Safer than SMS codes, which SIM-swap fraudsters can intercept.
- Cold wallet
A wallet kept offline, usually a hardware device such as a Ledger or Trezor. Best for savings you do not touch often.
- Crypto wallet
An app or device that holds the keys to your crypto. The coins stay on the blockchain; the wallet proves they are yours.
- Custodial wallet
The company holds the keys for you, like a bank. Easy to recover with a password reset, but the company can freeze it.
- Hot wallet
A wallet on an internet-connected phone or computer. Convenient for daily use, more exposed to hacks.
- Non-custodial wallet
Only you hold the keys, for example Trust Wallet or MetaMask. Nobody can freeze it — and nobody can recover it if you lose the seed phrase.
- Private key
The secret number that signs transactions from a wallet address. The seed phrase is a human-readable way to back it up.
- Seed phrase
The 12 or 24 secret words that can restore your wallet on any phone. Anyone who sees them can take everything. Never type them into a website or share them on WhatsApp.
Write it on paper (or steel), keep two copies in different safe places and never photograph it. Real support staff will never ask for it.
- Wallet address
The public "account number" you share to receive crypto. It is safe to share; the seed phrase is not.
Networks and transfers
- BEP20
The token standard on BNB Smart Chain. Fees are paid in BNB and are usually a few US cents.
- Block explorer
A public website (such as Tronscan or Etherscan) that shows every transaction on a blockchain.
- Confirmation
Each new block added after your transaction. Exchanges credit deposits after a set number of confirmations.
- ERC20
The token standard on Ethereum. The most widely supported, and usually the most expensive network for sending USDT.
- Gas / network fee
The fee paid to the blockchain (not to the exchange) to process a transfer. It changes with network congestion.
- Memo / tag
An extra number some coins (XRP, TON and others) need so an exchange knows which customer a deposit belongs to. Forget it and the deposit can get stuck.
- Network (chain)
The blockchain a transfer travels on. USDT exists on TRON (TRC20), BNB Smart Chain (BEP20), Ethereum (ERC20) and others — sender and receiver must pick the same one.
- TRC20
The token standard on the TRON blockchain. USDT-TRC20 is popular in Kenya because transfers are cheap and fast, but you need a little TRX for fees.
- TxID (transaction hash)
A unique receipt number for a blockchain transfer. Paste it into a block explorer to see whether the transfer arrived.
Kenya: law, tax and money
- AML
Anti-money-laundering rules. They are why exchanges ask where your money comes from and may freeze suspicious accounts.
- CBK
Central Bank of Kenya. Under the VASP Act it licenses crypto wallet providers, payment processors and stablecoin issuers.
- CMA
Capital Markets Authority. Under the VASP Act it licenses crypto exchanges, brokers and investment advisers.
- Digital Asset Tax (DAT)
A 3% tax on the value of crypto transfers introduced in September 2023 and repealed by the Finance Act 2025.
- Excise duty on VASP fees
Since 1 July 2025, a 10% excise duty applies to fees that crypto service providers charge — not to the value of the crypto you trade.
- FATF grey list
A list of countries under increased monitoring for money-laundering controls. Kenya is on it, which is one reason for tighter checks on crypto and P2P.
- KRA
Kenya Revenue Authority, the tax collector. It administers the excise duty on crypto platform fees and income tax rules.
- KYC
Know Your Customer: identity checks (ID or passport, selfie, sometimes proof of address) that regulated platforms must run before you trade.
- M-Pesa GlobalPay
Safaricom's virtual Visa card for paying international websites from M-Pesa. Safaricom lists cryptocurrency among the restricted merchant categories.
- Paybill / Till number
Safaricom business numbers for receiving M-Pesa payments. A real company Paybill shows the registered business name before you confirm.
- Remittance
Money sent home by family working abroad. Kenya receives billions of dollars a year this way.
- VASP
Virtual Asset Service Provider: any business that exchanges, stores or transfers crypto for customers. Kenya licenses them under the VASP Act 2025.
Risks and scams
- Binary options
A yes/no bet on whether a price will be higher or lower after a short time. Not crypto ownership and widely restricted by regulators.
- IOU token
A placeholder traded on an exchange before the real coin can be withdrawn. Prices for IOUs can differ wildly from the eventual real coin.
- Leverage
Borrowed money that multiplies gains and losses. At 10x leverage a 10% price move against you can wipe out your position.
- Phishing
Fake websites, SMS or WhatsApp messages that copy a real brand to steal your login, OTP or seed phrase.
- Ponzi scheme
An "investment" that pays early members with new members' money. Guaranteed daily returns are the giveaway.
- Reversal / chargeback
Pulling back a payment after it was sent. A fraudster may pay a P2P seller, receive crypto, then request an M-Pesa reversal.
- Rug pull
When a project's creators drain the money and vanish.
- SIM swap
A fraudster convinces a mobile operator to move your number to their SIM, then receives your SMS codes and M-Pesa messages.
- Volatility
How sharply a price swings up and down. Bitcoin can move 5–10% in a single day; KES savings do not.
