Below are common terms you may hear and see in the crypto world, we hope this helps you to get a better understanding of cryptocurrency.
- Airdrop – The process of distributing tokens to wallets. Tokens that airdropped are often free
- ATH – Acronym for All Time High
- Altcoin – A name for cryptocurrency coins that are not Bitcoin.
- Atomic Swap – Atomic swaps or atomic cross-chain trading, is the exchange of one cryptocurrency to another cryptocurrency, without the need to trust a third-party.
- Bags – Slang for crypto holdings. Often stated like “filling my bags”, fill your bags”
- Blockchain – The digital ledger technology which allows cryptocurrencies to function securely.
- Capitulation – to surrender or give up. In financial circles, this term is used to indicate the point in time when investors have decided to give up on trying to recapture lost gains as a result of falling prices.
- Digital Asset – Another terminology for cryptocurrencies and virtual currencies.
- Exchange – An online platform/website where you can both purchase and sell cryptocurrencies. Popular exchanges include Coinbase, Bittrex and Bitstamp.
- FOMO – The acronym for fear of missing out
- Fork – When a cryptocurrency splits in two resulting in an old and new version, essentially the blockchain gets split. There are hard forks and soft forks, a hard fork is meant to create two blockchain/coins and a soft fork is meant to result in one. An example of a hard fork would be Bitcoin Cash.
- FUD – A three letter abbreviation for “Fear, Uncertainty and Doubt”. This is a disinformation strategy that predates cryptocurrency.
- Hashrate – The speed at which a block is discovered and the rate at which the related math problem is solved.
- HODL – A purposeful misspelling of the word Hold, signifying a sentiment of holding your crypto for a long term sell off for bigger profits. Also, represents the phrase “Hold on for Dear Life”
- ICO – Acronym for Initial Coin Offering
- Market Cap – Market Capitalization is the aggregate market value of a cryptocurrency or stock represented in a dollar amount
- Mining – Mining is the term used for discovering and solving blocks along the blockchain. A mining reward is given for solving the algorithm and lengthening the chain. The mining reward for the Bitcoin blockchain is Bitcoin.
- Price Correction – A reversal of price, usually negative, to adjust for an overvaluation. Price corrections happen very often in the cryptocurrency market.
- Privacy Coin – A cryptocurrency that is anonymous. Examples of privacy coins are Monero and Dash.
- Proof-of-Stake (PoS) – A type of algorithm by which a cryptocurrency blockchain network aims to achieve distributed consensus. Ethereum uses the PoS algorithm. In PoS-based cryptocurrencies the creator of the next block is chosen via various combinations of random selection and wealth or age (i.e., the stake).
- Proof-of-Work (PoW) – The original consensus algorithm in a Blockchain network. Bitcoin uses the PoW algorithm. This algorithm is used to confirm transactions and produce new blocks to the chain. With PoW, miners compete against each other to complete transactions on the network and get rewarded.
- STO – Security Token Offering – Asset backed token offering that complies with US securities laws
- Technical Analysis (TA) – Technical Analysis is the art/science of trying to predict future trends from historic price and volume data in the crypto and stock market
- Wallet – Refers to the wallet in which you store your cryptocurrency, there are different types of wallets such as a hardware wallet, paper wallet and software wallet.
- Wallet Address – Usually referring to the identifier code in which you would send or receive cryptocurrency, here is an example of a Bitcoin Wallet Address – 3GPcKwB3UGML4UiYqZM6BYx7Nu5Dj7GKDD
- Whale – An investor with a very large amount of coins or money. They are move markets with large transactions.