Application Programming Interface (API)

An API is the connective layer that lets one piece of software talk to another without either side needing to understand the other's internal code. In crypto, this is the plumbing behind almost every automated interaction with an exchange, blockchain explorer, or price aggregator: instead of a person clicking through a website, a script calls a defined set of endpoints and receives structured data back, usually formatted as JSON.

Exchanges generally expose two kinds of API. A REST API works on a request-and-response basis: a program asks for a balance, a price, or an order's status and gets a single snapshot in reply. A WebSocket API instead keeps a connection open and pushes updates the instant they happen, which is why most trading bots and order-book tools rely on streaming feeds rather than repeatedly polling REST endpoints for the latest price.

Access is controlled through an API key, typically a public identifier paired with a private secret used to sign each request. Keys can be scoped to specific permissions, read-only market data, trading, or withdrawals, so a leaked key does not automatically hand over full account control. Exchanges also enforce rate limits, capping how many calls a key can make per minute, to protect their infrastructure from abuse.

Beyond exchanges, node providers, block explorers for chains like Ethereum, and data aggregators all publish APIs, letting developers build wallets, dashboards, and bots without running their own servers. Because a trading-enabled key can move real funds, restricting permissions and never embedding keys in client-side code are basic security habits for anyone building on top of one.