Ichor

Ichor is the reason a Crimson world has an easier time with heavily armored enemies. Everything made from it applies a debuff that strips defense off whatever you hit, and that lifts the damage of every other weapon in play, including anything your friends are firing. The bullets and the flask end up in most loadouts, and the arrows keep bows worth carrying much longer than they otherwise would be.

You are not locked out. Once the walls are up the Dryad sells crimson seeds while you are standing in a graveyard, and seeding a pocket of Crimson underground gives you something to farm. The biome takes a while to count as one, so plant it early and come back later. Hauling material in from a second world works too if you keep one around.

The word is the blood of the gods in Greek myth, which the tooltip nods at, though it also means the discharge from a wound. Lovecraft used it constantly when describing things that should not exist. The golden color is a modern invention rather than anything the old sources specify.