Let’s just say that you cannot enter a battlefield without any gear to protect yourself. The same principle can be applied when you are planning to put your money in cryptocurrency. It’s just prim and proper to know the terms about crypto beforehand if you don’t want your money to go haywire.
The following terms below might become handy for you to study in case you are scheming to set foot in the world of cryptocurrency
1. ALL-TIME HIGH (ATH)
All-time high is abbreviated as ATH. It refers to a cryptocurrency that has achieved the highest market capitalization price in its history.
The words “alternative” and “cryptocurrency” composed the altcoin. Any cryptocurrency that isn’t Bitcoin falls into this category. Thousands of altcoins have developed since Bitcoin’s introduction in 2011, with Ethereum being the largest and most popular.
An asset with a strong upward trend.
An asset with a strong downward trend.
A collection of computers that come to an agreement on a common ledger. Blockchain technology is used by cryptocurrencies like Bitcoin and Ethereum to digitally record all transactions that take place within their networks.
The words “cryptography” and “currency” are combined in this term. Cryptography refers to the technique of delivering encrypted messages with many parties, whereas currency refers to a monetary system that can be used to exchange goods and services. As a result, Bitcoin is a new type of digital currency that uses encryption to safeguard blockchain transactions.
This is the point in time when the price of a cryptocurrency drops.
DAPPS, short for decentralized applications, are programs that run on a decentralized blockchain network like Ethereum using smart contracts.
Decentralized Finance (DEFI) allows users to lend/borrow, earn interest, and trade cryptocurrencies without requiring a bank or central exchange through the use of secure distributed ledgers. Smart contracts are used instead of financial institutions in this experimental form of finance.
10. DIGITAL CURRENCY
Any payment method that is available in an electronic format. Virtual currencies, central bank digital currencies, and cryptocurrencies are examples of this. Digital currency can also be thought of as an electronic form of fiat money.
ERC-20 is an Ethereum smart contract standard for creating fungible coins. These are interchangeable tokens that are identical to one another. Previously, to handle a new coin, wallets and exchanges had to create custom code. The ERC-20 standard is used by hundreds of coins now.
The ERC-721 smart contract standard is used to create non-fungible tokens (NFTs). These are one-of-a-kind tokens that cannot be exchanged.
A branching or forking of a blockchain network’s protocol into two separate routes. One blockchain adheres to the old protocol, while the other adheres to the new protocol. For example, Bitcoin Cash is a fork of the Bitcoin protocol.
Fungible assets are those that can easily be exchanged with other assets of the same type, for example 1 bitcoin for 1 bitcoin, P1 for P1.
HODL stands for Hold On for Dear Life and was coined as a result of a typo on a Bitcoin forum in 2013. This abbreviation alludes to the habit of retaining cryptocurrency for the long term rather than selling it quickly.
A Bitcoin feature in which the incentive for mining Bitcoin transactions is halved after a certain number of blocks have been mined.
A record that keeps track of how much money comes in and goes out.
18. MARKET CAPITALIZATION
This is the total worth of all the coins that have been mined in cryptocurrency terms. To find a cryptocurrency’s market cap, simply multiply the current number of coins by their current value.
The process of confirming transactions on the blockchain to put additional currency to circulation.
Because each asset is fundamentally different from the others, non-fungible assets cannot be exchanged. You can’t readily replace the Mona Lisa with another work of art, for example, because each work of art is valued differently.
21. NON-FUNGIBLE TOKEN (NFT)
A digital asset that is unique and non-transferable, such as a picture, audio, or video file, and whose ownership is tracked on the blockchain.
22. SMART CONTRACT
A self-executing programmable contract that has its conditions of agreement written directly into its lines of code and is kept on a blockchain.
A cryptocurrency whose value is linked to the worth of other fiat currencies or commodities. The stablecoin US Dollar Coin (USDC), for example, is tied to the value of the US Dollar.
24. WALLET ADDRESS
A wallet address is similar to the intended mailing address of your coins, much like your address is similar to where you live. The blockchain can’t authenticate or verify the existence of your cryptocurrency unless it has a place to “live” or be stored. You won’t be able to keep any cryptocurrencies if you don’t have a wallet address.
Disclaimer: The value of cryptocurrencies is extremely volatile and can fluctuate dramatically at any time. Purchasing, selling, and/or holding cryptocurrencies entails significant risk and is not appropriate for everyone. Before making any bitcoin transaction, carefully assess your financial situation and risk appetite.