Yeah, we’re talking Crypto again (Yes, the cool kids call it Crypto).
Many consider Cryptocurrency to be the future, so get with it, or get LOST.
While the field of cryptocurrency is new, the mathematical principles and logistics behind it are solid and workable. It’s very likely that majority of the transactions will be carried out in this form of currency sometime in the future.
If you’re interested in cryptocurrency, you need to take some time to understand how it works and familiarize yourself with cryptocurrency slang.
We update this doc periodically as NEW terms come to light. Let’s get it.
Address is similar to your bank account number or identity. It provides people with a destination so they can make payments and transfer coins. The Address is unique and encrypted so it can’t be altered or uncovered by anyone.
Any type of currency in the cryptocurrency world that isn’t Bitcoin is called Alternative coin or Altcoin. The examples are Steem, Ethereum, and Litecoin.
This is the complete list of blocks that have been mined since Bitcoin was introduced. It’s essentially a ledger that contains information of all the coins in circulation and has it’s own set of blockchain glossary. The information is accessible to everyone that uses cryptocurrency to ensure system transparency.
A form of digital currency that consists of encrypted lines of coding with unique signatures. They’re easy to track, based on sound mathematical principle, easy to use, and secure. The most well-known example of this is Bitcoin but there are other currencies like Namecoin, Litecoin, and PPCoin available as well.
A transaction of very small value that doesn’t offer much financial profit but takes time space in the blockchain.
Any form of real world currency like dollars or yen. These currencies are centralized and not digital.
Mining is a way to earn more cryptocurrency or Bitcoins. You need the processing power of a good computer to unbundle every block of Bitcoin or currency before you can get access to it. Every block takes about one year to unbundle on a regular desktop PC.
Proof of Work
This is the system that allows you to mine and has enough processing power to provide reasonable value of coins.
There are a number of other words and phrases you’ll come across when you trade or mine coins. You need to become familiar with ethereum terminology, Altcoin lingo, etc, in order to be successful.
Public or Private Key
It’s an encryption key that allows people to secure communication and direct it towards the recipient. The receiving party can use the same key to unlock the message and read the contents.
Pump and Dump
Increasing the apparent value of the currency with hype and misleading information before selling it for more than its worth.
Signature is a unique line of code that allows you to prove your ownership of the cryptocurrency wallet, coins, and contracts. It is similar to the signature you use in real life to sign checks and contracts, only it’s much more secure and can’t be duplicated. They’re only known to the owner and can’t be uncovered.
Trading on this platform includes its own set of lingo and terminology and these include the ones mentioned below:
- Bag Holder – Someone that bought coins when the value was high and missed the opportunity to sell, leaving him with a bag of useless coins.
- Borrowing rate – Borrowing at a pre-determined rate for a leveraged position in trading.
- HODL – Holding the coin instead of selling it.
- FOMO – Fear of Missing Out on good trades because you weren’t keeping an eye on the system.
- Lending rate – Letting others borrow your coin at a pre-determined rate. This is only valid in some exchanges.
- Limit Order – An order with a price limit target that will be executed automatically when the target is hit.
- Long – You take the long position if you believe the value will rise in the future and you should wait for the sale.
- Margin trading – This means trading with leverage. You borrow coins on loan from one side and sell it for the other.
- Short – You take the short position if you believe that value will drop in the future so a quick sale is the best way.
- Whale – Traders with a lot of capital on their hands.
- There are several other terms that you’ll learn through trial and error during the trading process.
For more on mining and purchasing Bitcoin, check out our WTF is Bitcoin post!