Plain-language definitions of the terms you meet when using crypto without identity verification — from KYC and the Travel Rule to atomic swaps and view keys.
- Address reuse
- Receiving more than once to the same address. It links your payments together on-chain; good wallets give you a new address every time.
- AML
- Anti-money-laundering rules. They're the legal reason most exchanges must identify customers and monitor transactions.
- AMLR
- The EU's Anti-Money-Laundering Regulation (2024/1624). From 10 July 2027 it bars banks and crypto providers from anonymous accounts and privacy coins, and requires ID at crypto ATMs. It does not ban self-hosted wallets. Learn more →
- Atomic swap
- A trade between two blockchains that either completes fully or refunds both sides, enforced by code — no company holds your coins. Learn more →
- CASP / VASP
- Crypto-asset (or virtual-asset) service provider: exchanges, custodial wallets, ATMs and similar businesses that fall under financial regulation.
- Chain analysis
- Tracing payments on public blockchains to cluster addresses and link them to people. Bitcoin is fully traceable; Monero hides senders, receivers and amounts.
- Coin control
- Choosing exactly which coins (UTXOs) a payment spends, so you don't accidentally merge coins from different sources. Learn more →
- Coinjoin
- Many users combine payments into one transaction so it's harder to tell who paid whom.
- Custodial
- Someone else holds the keys and therefore your coins. Convenient, but they can freeze them or ask for ID.
- DAC8 / CARF
- EU (DAC8) and international (CARF) tax-reporting rules that make crypto providers report user identities and transactions to tax authorities from 2026. Learn more →
- Dust attack
- Sending tiny amounts to many addresses to see how they're later spent together and de-anonymise owners. Don't spend unexpected dust.
- Escrow (P2P)
- Coins locked during a peer-to-peer trade and released only when both sides — or an arbitrator — agree. Learn more →
- Fidelity bond
- A deposit a trader posts (for example on RoboSats) that they lose if they cheat or abandon the trade.
- Hold invoice
- A Lightning payment that's locked but not settled until a condition is met — the basis of RoboSats' escrow.
- I2P
- An anonymous network similar to Tor. Sites end in .i2p.
- KYC
- “Know your customer”: identity checks such as ID scans, selfies and proof of address that regulated services must collect. Learn more →
- KYC level
- LessKYC's 0–4 scale of how much identity a service demands, from never (0) to always mandatory (4). Learn more →
- Lightning Network
- A layer on top of Bitcoin for fast, cheap payments. Payments aren't published on the main chain.
- Liquidity partner
- The larger exchange an instant-swap service routes your trade through. Their AML checks are a common reason swaps get frozen. Learn more →
- MiCA
- The EU's Markets in Crypto-Assets regulation. Since 1 July 2026, unlicensed providers may no longer serve EU clients. Learn more →
- Mixer
- A service that pools and redistributes coins to break the transaction trail. Centralised mixers have repeatedly been seized.
- Monero (XMR)
- A cryptocurrency that hides sender, receiver and amount by default using ring signatures, stealth addresses and RingCT.
- Multisig
- A wallet or escrow that needs several keys (for example 2 of 3) to spend, so no single party can run off with the coins.
- Non-custodial / self-custody
- You hold the keys, usually as a seed phrase. Nobody can freeze your coins — and nobody can recover them if you lose the seed. Learn more →
- Onion service
- A website reachable only through Tor, with an address ending in .onion. It hides the server's location as well as yours.
- P2P exchange
- A platform where people trade directly with each other instead of with a company. Learn more →
- PEP
- Politically exposed person. Name matches against PEP lists can trigger surprise KYC requests.
- Phishing clone
- A fake copy of a real service's website made to steal deposits or seed phrases. Learn more →
- Privacy coin
- A coin with built-in privacy, such as Monero. EU law calls them “anonymity-enhancing coins”.
- Refund address
- The address where a swap service returns your coins if a trade fails. Always set one.
- Ring signature
- Monero's technique of mixing your real input with decoys so outside observers can't tell which one was spent.
- Seed phrase
- The 12–25 words that restore a wallet. Anyone who sees it controls your coins; never type it into a website.
- Shotgun KYC
- When a service that normally doesn't ask for ID suddenly demands it — often after you've deposited. Learn more →
- Soft KYC
- Light checks such as an email or phone number, without ID documents.
- Source of funds (SoF)
- Paperwork proving where your money came from, sometimes demanded before a frozen swap is released. Learn more →
- Stealth address
- A one-time address generated for each Monero payment, so payments to you can't be linked on-chain.
- Tor
- Free software that routes your traffic through several relays to hide your IP address. Tor Browser also reaches .onion sites.
- Travel Rule
- Rules that make providers pass sender and recipient details along with transfers. In the EU, transfers over €1,000 to self-hosted wallets need an ownership check. Learn more →
- UTXO
- An “unspent transaction output” — a single coin in a Bitcoin wallet. Wallets combine UTXOs to make payments.
- View key
- A Monero key that lets someone see incoming payments but not spend them. Light wallets share it with their server.
- Warrant canary
- A regularly updated statement that a service hasn't received secret government orders. If it stops being updated, assume it has.