Dictionary

What is the meaning of the most commonly used terminology in the financial cryptocurrency market?

Altcoin

‌Short for "alternative coin‌." Apart from Bitcoin, all cryptocurrencies are altcoins.

Address

An address is a unique string of letters and numbers that is used to send/receive cryptocurrency from another person.

Ask

The “ask” is the price at which you can buy the base currency.

ATH

ATH is an acronym for "All-Time High." It refers to the highest-priced milestone cryptocurrency has achieved ever.‌

Atomic Swap

‌An atomic swap is a proposed feature in cryptocurrencies, allowing for the exchange of one cryptocurrency for another cryptocurrency without the need for a trusted third party (centralized exchange).

AML

"Anti-Money Laundering" techniques are used to stop people from converting illegally obtained funds, to appear as though they have been earned legally.

Arbitrage

Buying a cryptocurrency on an exchange and selling the same cryptocurrency on another one. Earning extra money because of the difference in the spread between the two exchanges. Arbitrage opportunities may occur due to differences in exchange reputation, community coin preferences, and ease of bank funding. Take note that fees, limits, and prices could change anytime when you are transferring your coins between exchanges, especially during volatile times.

Bid

The “bid” is the price at which you can sell the base currency.

Bit

A sub-unit of bitcoin. 1 bitcoin (BTC) = 1,000,000 bits.

You can always buy and sell less than one bitcoin.

Bitcoin

The original and most popular cryptocurrency. Bitcoin (with a capital B) refers to the overall concept of the Bitcoin P2P protocol & Bitcoin payment network. Bitcoin is the first open-source & decentralized cryptocurrency invented by Satoshi Nakamoto. The Bitcoin white paper was published in 2008, and Bitcoin was released in 2009.

Bitcoin ATM

A cashpoint where people can trade fiat currency and bitcoins.

Bag Holder

Someone still holding an altcoin after a pump and dump crash.

Block

Blocks are the main component of blockchain technology.

Blocks contain a summary of validated transactions that were made through a specific cryptocurrency network over a given period. Along with a summary of validated transactions, blocks also contain a block header, which includes the necessary metadata to 'chain' blocks together. Once a block has been appended to the blockchain, it is improbable to alter.

Block Height

It is the number of blocks mined after the genesis block.

Block Reward

It is a reward in the form of native cryptocurrency given to miners for solving a computationally difficult problem. Bitcoin miners now get 12.5 BTC for solving each problem for adding blocks to the blockchain.

Bullish

A feeling based on some factors that the price of a cryptocurrency will increase.

Bearish

A feeling based on some factors that the price of a cryptocurrency will decrease.

Breakout

When market price moves passed predefined support or resistance level.

Blockchain

The key technology behind most cryptocurrencies, blockchain serves as a cryptographically-secure distributed ledger of records on a network. A blockchain in cryptocurrency is comprised of tamper-proof blocks that record all cryptocurrency transactions for a set period of time. Blocks get appended to a blockchain in specified intervals through a process called mining.

Circulating supply

The price of a coin has no meaning on its own. However, the price of a coin, when multiplied by the circulating supply, gives the coin's market cap.‌

Cryptocurrency

Cryptocurrencies (also referred to as coins) are digital currencies that exist on their own blockchain.

Cryptography

The act of writing codes. A branch of mathematics and computer science that is behind the invention of cryptocurrencies.

Core

The group of individuals that are most active in developing a cryptocurrency.

Cold Storage

Cold storage refers to cryptocurrency wallets that are not accessible to the internet. Some examples of cold storage include hardware wallets (also referred to as hard wallets) and paper wallets. Cold storage is a safer approach to storing your cryptocurrency, as they're offline from potential breaches or hackers.

Confirmation

Confirmation means a cryptocurrency transaction has been verified (via the mining process) and added to a block that contains many other transactions.

Decentralize

The act of transferring authority away from government and dispersing that authority to smaller entities (notice how cryptocurrency has no geographical boundaries due to the government)

Decryption

A process of turning ciphertext back into plaintext.‌

Difficulty

The difficulty, in Proof-of-Work mining, is how hard it is to verify blocks in a blockchain network. In the Bitcoin network, the difficulty of mining adjusts verifying blocks in every 2016 blocks. This process is because of keeping bitcoin block verification time at ten minutes.

Digital asset

Anything that exists in a binary format and comes with the right to use. Data that do not possess that right are not considered assets. Digital assets include but are not exclusive to digital documents, audible content, motion picture, and other relevant digital data that are currently in circulation or are, or will be stored on digital appliances.

ERC20

ERC20 is a technical standard used for smart contracts on the Ethereum blockchain for implementing tokens. ERC stands for Ethereum Request for Comment, and 20 is the number that was assigned to this request.‌

Ether

Ether (ETH) is the primary cryptocurrency of Ethereum. It is known as the 'crypto-fuel' for the Ethereum network because along with ether being a cryptocurrency, it is also used to execute smart contracts.

Exchange

An Exchange is a website or mobile application where individuals can buy and sell cryptocurrencies using fiat money, bitcoin or altcoins.

Fiat

Fiat money is a government-issued currency that is not backed by a physical commodity, such as gold or silver. Regulated and centralized paper currency of any nation.

Fork

A fork is the splitting of a blockchain into an alternate version.

FUD

FUD is any form of distributed information that elicits Fear, Uncertainty, Doubt. In the cryptocurrency world, FUD is most commonly spread by individuals who are intentionally trying to manipulate the price of a specific coin. FUD may also be unintentionally elicited by misinterpreting cryptocurrency news articles and/or media coverage.

FOMO

Fear of missing out. A feeling in which you want to get onboard a skyrocketing price rally.

Gas

Measurement is roughly equivalent to computational steps.

Genesis Block

The very first block in a blockchain.

GPU‌

A "Graphics Processing Unit" is a specialized electronic circuit designed to rapidly manipulate and alter memory to accelerate the creation of images in a frame buffer intended for output to a display device.

Hash Function

‌Hash function is defined as a computer program that takes information and turns it into a series of letters and numbers of a certain length. This process is non-reversible.

Hardware Wallet

Hardware wallets (also known as hard wallets) are a form of cryptocurrency cold storage. Such wallets store your private keys offline from potential breaches or hackers.

HODL

In the world of cryptocurrency, HODL means HOLD. HODLing cryptocurrency is the process of holding onto your cryptocurrency over long periods, regardless of market fluctuations. HODL originated from a popular Bitcoin message board back in 2013, in which a user stated he was HODLing his BTC. It has then snowballed into the most popular meme in cryptocurrency.‌

Hot Storage

Hot storage refers to cryptocurrency wallets that are connected to the internet. Some examples of hot storage include online wallets, software wallets, and storing your cryptocurrency within an online exchange account. The opposite of hot storage is cold storage.

ICO

"Initial Coin Offering," which takes a page from the usual IPOs investors know. Coins bought during ICOs are usually sold for a profit when the cryptocurrency first hits exchanges. This is due to the initial hype, which increases demand for the coin. On the supply side, ICOs create entry barriers as the buyer has to set up his private wallet to receive the coins from the ICO purchase.

ISO

"Initial Scam Offering," simply a play on words for Initial Coin Offering, referring to the fact that majority (if not all) of them are scams.

KYC

"Know Your Customer" (or Know Your Client) refers a situation where you have checked the identity of an individual and have taken precautions so that the money you are receiving is clean and not associated with laundering.

Lending Rate

Some exchanges have lending accounts. You may deposit your coins into these lending accounts to lend your coins for others to execute their leveraged trades. The lending rate fluctuates throughout the day based on the demand for shorting the coin.

Leverage

In trading, leverage multiplies the real funds in your account by a given factor, enabling you to make trades that result in a significant profit. By giving leverage to a trader, the trading exchange is effectively lending them money, in the hope that it will earn back more than it loaned in commission. Leverage is also known as a "margin requirement."

Limit Order (Limit Buy/Limit Sell)

Buy/Sell orders placed by traders to buy or sell a crypto-currency when the price meets their target amount.‌

Liquidity

‌The ability to buy and sell an asset quickly, with pricing that stays roughly similar between trades. A suitably large community of buyers and sellers is essential for liquidity. The result of an illiquid market is price volatility, and the inability to quickly determine the value of an asset.

Margin call

The act of calling in a margin requirement. An exchange will issue a margin call when it feels that a trader does not have sufficient funds to cover a leveraged trading position.

Margin trading

A term for 'trading with leverage.' In this instance of trading, you borrow one side of the trading pair at an agreed loan rate and sell it for the other side of the trading pair. Depending on the direction you believe the market to move, you may place a long or a short bet on the trading pair of concern.

Market order

An instruction is given to an exchange, asking it to buy or sell an asset at the going market rate. In a cryptocurrency exchange, you would place a market order if you wanted to buy or sell cryptocurrencies immediately, rather than holding them until a set market condition is triggered to try and make a profit.

Mining

Mining is the process of expending computing power to process and verify cryptocurrency transactions. The mining process effectively adds blocks (these blocks contain the latest transactions) to the blockchain. Miners are incentivized with mining rewards and TX fees.

Noob‌

A person who is inexperienced in cryptocurrencies.

Node

Node is defined as any computing device (computer, phone, etc.) that are participating in a network by way of receiving and sending data.

Cryptocurrencies are supported by a network of computers, each keeping a digital record of the data known as a blockchain.

Order book

An order book is a list of all the active buy and sell orders placed for a currency on an exchange.

OTC

"Over The Counter." OTC exchange is an exchange in which traders make deals with each other directly, rather than relying on a central exchange to mediate between them.

Paper Wallet

Paper wallets refer to a physical print-out of your public key(s) and private key(s). This form of cold storage is typically treated like expensive jewelry and stored folded in multiple (as a backup precautionary) waterproof and fire-resistant safes. Funds that are stored on paper wallets can be accessed by sweeping or importing.‌

Private Key

A private key is the PRIVATE portion of a wallets key pair. It is a long string of random characters that prove you have access to cryptocurrency in your wallet. Private keys allow you to spend cryptocurrency from a wallet; therefore, they must NEVER be revealed to anybody. This is especially the case for paper wallets, where your private key gets printed on a piece of paper (which can be sneakily photographed by somebody in an attempt to steal your coins. )

Public Key

The public key of a wallet key pair is used to create an address to receive cryptocurrency. A public key is created from a private key in a key pair.

Proof Of Work

A decentralized consensus mechanism that is done by mining algorithms by spending computational power.

Proof Of Stake

A decentralized consensus mechanism in which your existing stake in currency is used to mine or forge blocks to reach the consensus.

Pump & Dump

Massive buying and selling of cryptocurrencies when the price is to one's benefit.

Ponzi Scheme

A fraudulent investment operation where the operator generates returns for older investors through revenue paid by new investors. ‌

Peer to Peer

Peer to peer or P2P is defined as a connection between two or more computers that allows them to share information, files, or other data directly.

Pyramid

Where an organization is set up on a referral to referral basis, always accepting investments with locked contracts to hold onto investors money, the more people underneath each other investing in the system is the only fuel for maintaining these infrastructures until they can no longer withstand the demand for payouts. At this time, they will generally disappear or crumble.

Rekt

This is a misspelling of the word "wrecked." The term refers to a trader or investor who is utterly ruined and destroyed with losses from the current downfall of a price. Term "rekt" also traces back to multiplayer video games

Satoshi

A Satoshi is the smallest unit of Bitcoin. It is named after Satoshi Nakamoto, the creator of Bitcoin. Each BTC is divisible until the 1/10^8 part. A unit of Satoshi is equal to 0.00000001 bitcoin.

Satoshi Nakamoto

Satoshi Nakamoto is believed to be the pseudonym for the programmer (or programmers) who invented Bitcoin.

Scamcoin

A fake cryptocurrency created to make money for the creator while stealing it from those who supported and invested in the coin

Shill

The act of unsolicited endorsing of the coin in public. Traders who bought a coin has an interest in shilling the coin, in hopes of igniting the public's interest in that particular coin.

Software Wallet

Software wallets (commonly referred to as soft wallets) are cryptocurrency wallets that are based in software. Software wallets come in three forms: desktop wallets, mobile wallets, and web wallets. Software wallets are a form of hot storage.

Spread

The difference between ask and bid price is known as the spread.

Symbol

A symbol (also referred to as ticker symbol) is a unique identifier for a particular cryptocurrency. Examples of symbols include XRP — the symbol for Ripple, XBT/BTC — the interchangeable symbols for Bitcoin, XLM — the symbol for Stellar, TRX — the symbol for TRON, and LTC — the symbol for Litecoin.

Stop Loss

A "sell/stop-loss" is placed on top of a cryptocurrency trade that executes a sell order when the cryptocurrency reaches a specific price. Sell stop losses are placed below the buy-in price and are a useful tool in mitigating risk. The process is the same for a buy stop loss, except the stop-loss price must be above the buy-in price.

Token

Tokens are units of value that are built on top of existing platforms such as Ethereum, Omni, Nxt & NEO. Examples of tokens include EOS, TRON & OmiseGO (each built on top of Ethereum) & Red Pulse (built on top of NEO). Tokens are often distributed to backers of an ICO as a reward for funding the initiative.

Transaction Fees

Bitcoin transaction incentives that the miners receive for mining block via bitcoins, which is a small fee that the bitcoin users pay to complete BTC transactions.‌

TX

TX stands for the transaction. A transaction is the transfer of cryptocurrency. Transactions are collected in blocks and permanently recorded on the blockchain through the confirmation process.

Volatility

A measure of the price movement of an investment over time. The cryptocurrency markets are well known for their high levels of volatility.

Whitepaper

A report which articulates the problem and solution that the blockchain project/cryptocurrency is trying to solve.

Wallet

A secure digital wallet is keeping private keys. It usually contains a software client which allows access to view and create transactions on a specific blockchain that the wallet is designed for.