Cold dark matter (or CDM) is a refinement of the big bang theory that contains the additional assumption that most of the matter in the Universe consists of material that cannot be observed by its electromagnetic radiation (dark) and whose constituent particles move slowly (cold). As of 2006, most cosmologists favor the cold dark matter theory as a description of how the universe went from a smooth initial state at early times (as shown by the cosmic microwave background radiation), to the lumpy distribution of galaxies and their clusters we see today — the large-scale structure of the universe.
In the cold dark matter theory, structure grows hierarchically, with small objects collapsing first and merging in a continuous hierarchy to form more and more massive objects. In the hot dark matter paradigm, popular in the early eighties, structure does not form hierarchically (bottom-up), but rather forms by fragmentation (top-down), with the largest superclusters forming first in flat pancake-like sheets and subsequently fragmenting into smaller pieces like our galaxy the Milky Way. The predictions of hot dark matter strongly disagree with observations of large-scale structure, whereas the cold dark matter paradigm is in general agreement with the observations.
Two important discrepancies between the predictions of the cold dark matter paradigm and observations of galaxies and their clustering in space have arisen, however, creating a potential crisis for the cold dark matter picture.
Both of these problems have a number of proposed solutions, some more promising than others. It remains unclear as to how intractable these problems are; whether they represent a crisis or simply a nuisance is a matter of some dispute in the cosmological community.
The CDM theory makes no predictions about exactly what the cold dark matter particles are, and one large weakness in the cold dark matter theory is that it is unclear what the dark matter consists of. The candidates fall into three categories which are "humorously" named, as it is somehow usual, in physics.