Financial Glossary
Key terms in private banking and Bitcoin finance.
A
APR (Annual Percentage Rate)
The yearly cost of a loan including interest and fees, expressed as a percentage.
Asset-Based Lending
Loans secured by collateral such as inventory, accounts receivable, or equipment.
B
Bitcoin Collateral
Using Bitcoin as security for a loan, allowing borrowers to access liquidity without selling their cryptocurrency holdings.
Bridge Loan
Short-term financing used until permanent financing is obtained or existing obligations are removed.
C
Collateral
An asset pledged as security for repayment of a loan, to be forfeited in the event of default.
Credit Line
A flexible loan arrangement that allows borrowing up to a predetermined limit as needed.
Cryptocurrency Lending
Financial services that allow crypto holders to borrow against their digital assets or earn interest by lending them.
D
DeFi (Decentralized Finance)
Financial services built on blockchain technology that operate without traditional intermediaries.
Digital Asset
Any asset that exists in digital form and has value, including cryptocurrencies, tokens, and digital securities.
Due Diligence
The investigation or exercise of care that a reasonable business or person is expected to take before entering into an agreement or contract.
E
Equipment Financing
Loans or leases used to purchase business equipment, with the equipment itself serving as collateral.
H
HODL
A cryptocurrency investment strategy of holding onto assets long-term rather than selling, derived from 'hold'.
I
Interest Rate
The percentage of a loan amount charged by a lender to a borrower for the use of assets.
L
Leverage
Using borrowed capital to increase the potential return of an investment.
Liquidity
The ease with which an asset can be converted into cash without affecting its market price.
Loan-to-Value (LTV)
A ratio expressing the amount of a loan compared to the value of the asset purchased or used as collateral.
M
Margin Call
A demand by a broker for an investor to deposit additional money or securities to cover potential losses.
N
Non-Recourse Loan
A loan secured by collateral where the borrower is not personally liable for repayment beyond the collateral.
O
Over-Collateralization
Providing collateral that exceeds the value of the loan to reduce lender risk.
P
Private Key
A cryptographic key that allows access to cryptocurrency holdings and must be kept secure.
R
Refinancing
Replacing an existing loan with a new loan, typically with better terms or rates.
Risk Assessment
The process of evaluating potential risks that may be involved in a projected activity or undertaking.
S
Secured Loan
A loan backed by collateral that the lender can seize if the borrower defaults.
Smart Contract
Self-executing contracts with terms directly written into code on a blockchain.
Stablecoin
A cryptocurrency designed to maintain a stable value relative to a reference asset, typically the US dollar.
T
Term Loan
A loan with a fixed repayment schedule over a specified period.
U
Underwriting
The process of evaluating and assuming the risk of lending to a particular borrower.
Unsecured Loan
A loan not backed by collateral, typically requiring higher creditworthiness.
V
Volatility
The degree of variation in the price of a financial instrument over time.
W
Wallet
A digital tool that allows users to store, send, and receive cryptocurrencies.
Working Capital
Short-term assets minus short-term liabilities, representing the capital available for day-to-day operations.
Y
Yield
The income return on an investment, typically expressed as an annual percentage.
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