The crypto industry is full of unusual terms, acronyms, and words that we can often be left in a little bit of a head spin.
We’ve created a list of the most important crypto trading terminology to help get you started in the market.
Blockchain: One of the most used cryptocurrency terms, blockchain is the underlying technology of cryptocurrency that keeps the system secure.Block: Blocks make up a blockchain.Within each block are a series of transactions.Decentralised: In cryptocurrency, decentralised means that there is no central point of the network.Instead, it is spread over a series of users (nodes).Altcoin: Altcoin, a.k.a, Alternative Coin, is terminology labelled for cryptocurrencies other than/alternative to Bitcoin.For example, Ethereum, Dogecoin, and others are alternatives to Bitcoin.
Fiat currencies: Government-issued currencies that are not backed by anything physical.
Most currencies today are fiat currencies.Block: A Block is a file that stores transaction data.These blocks, when arranged in a linear sequence, form a Blockchain.Mining: Mining in the crypto world refers to the process of creating/gaining cryptocurrencies by solving cryptographic equations through the use of computers.In other words, it is a validation of the transaction.Cold Wallet: Cold Wallet, also called a hardware wallet or offline wallet, is a hardware device to store Bitcoin or cryptocurrencies offline.
It is not connected to the Internet.The exact opposite of Cold Wallet is Hot Wallet, meaning it is connected to the Internet.
Hard fork: Essentially a hard fork is a radical update to the blockchain that can make previously unvalidated blocks valid or the reverse.A hard fork can result in a new cryptocurrency being created.One well-known example would be Bitcoin and Bitcoin Cash.Dead coin: It refers to cryptocurrencies that don’t exist anymore due to various reasons.Proof of Work (PoW) : One of the most common algorithms in cryptocurrency.
It requires miners to mine blocks to validate transactions.Proof of Stake (PoS): Another highly common algorithm that requires users to stake some of their cryptocurrency to validate transactions.Some believe that this algorithm is much more efficient than Proof of Work.
DYOR: It refers to “Do Your Own Research.” Gas: Gas refers to the fee required to successfully conduct a transaction or execute a contract on the Ethereum blockchain platform.The more gas you set, the faster your transaction will be completed.Mooning: It is often used to describe a cryptocurrency that is under a strong upward market trend.Some use “to the moon.” Decentralized exchanges (DEX): are a type of cryptocurrency exchange which allows for direct peer-to-peer cryptocurrency transactions to take place online securely and without the need for an intermediary.
dApps: Stands for ‘decentralised application’, these are applications that are not centralised and work on top of the blockchain.Smart contracts: Smart contracts are essentially digitalised contracts that are executed on the blockchain between different parties.NFT: Non-Fungible Tokens are unique cryptographic tokens that we can use to represent ownership of unique items.Whale: A whale is the term used for the most valuable Bitcoin addresses.
There are about 2000 Bitcoin whale addresses, and only three own more than 100,000 BTC, according to BitcoinPlay.Satoshi: A Satoshi is the smallest denomination of Bitcoin and is equivalent to 100th billionth of one Bitcoin.It was named after Bitcoin’s creator, Satoshi Nakamoto.
Hash: The function of decrypting information.In cryptocurrency, miners must decrypt hashes to mine blocks.The more hashing power you have, the more blocks you can mine and the more block rewards you can receive.Double-spends: Quite simply, this is when someone can spend their cryptocurrency twice.In most cases, this is impossible unless someone performs a 51% attack.
51% attack: A theoretical attack where if an entity gains 51% of the hashing power, they can perform double-spends and other malicious activities.Ultimately, such an attack would likely cause the end of a cryptocurrency.DAO: Stands for ‘Decentralised Autonomous Organisation’, this is an organisation, usually made up of developers and shareholders who vote on how the blockchain should develop..
