The world of cryptocurrency is full of buzz words and confusing jargon. Even people who are involved with cryptocurrencies as a digital asset management solution continuously learn new terms all the time. Anyone who wants to enter this market needs to be familiar with basic terms know in order to make sound investment decisions. Here is a list of 20 cryptocurrency terms to get you started:
- Bot (Trading Bot): A program which trades automatically on electronic exchanges like Binance or Bittrex.
- Fiat Currency: Paper money like USD, British Pounds, Euro or Yen which is issued by a government and is legal tender for all debts.
- Cryptocurrency: A digital currency in which encryption techniques and blockchain technology are used to regulate the generation of units and verify the transfer of funds.
- ICO: Initial Coin Offering, a new way companies use to raise money by issuing cryptocurrency tokens instead of stock.
- Mining: The process through which new cryptocurrencies are created and transactions are verified on a blockchain network.
- Market Cap: The total value of all the currency in a cryptocurrency.
- Node: A computer which receives and verifies new transactions on a blockchain network.
- Ponzi Scheme: An investment fraud that involves promising high returns on an investment, with little risk involved to initial investors.
- Pump and Dump: A scheme in which a group of investors buy a large amount of an altcoin, increasing the value of its price. The investors then sell their coins to make profits, and stop buying it, causing the coin’s price to decrease dramatically.
- Whale: Term for people or entities that own large amounts of cryptocurrencies, usually holding 1% of the total cryptocurrency in circulation.
- Wallet: A file that holds multiple keys and currencies, particularly a digital wallet for cryptocurrencies.
- White Paper: A document that provides technical details, specifications and information about a blockchain project or cryptocurrency.
- P2P: Person-to-person, meaning transactions directly between people without any intermediaries like banks or clearinghouses.
- Mining Pool: Groups of miners that work together to mine cryptocurrencies and earn a share of the profits.
- Proof-of-Work: A consensus algorithm in which miners compete to solve cryptographic problems in order to add blocks of transactions to the blockchain.
- DApps: Decentralized apps, platforms that run on a decentralized P2P network instead of a single server.
- Altcoins: Any cryptocurrency that is an alternative to Bitcoin.
- Scamcoins: A cryptocurrency used to swindle people, usually by getting them to invest in a non-existent blockchain project.
- Smart Contracts: Computer protocols intended to facilitate, verify or enforce the negotiation or performance of a contract. Also known as programmable contracts, they can be used to replace traditional legal contracts in many spaces, such as the digital marketing blockchain.
- Token: A unit of value that an organization creates to self-govern its business model, and empower its users to interact with its products.
And that’s it! However, those 20 terms are just the tip of the iceberg. To become a better investor, it’s important to learn as much as possible about cryptocurrencies and the blockchain. Our blog is a great place to start learning about this digital asset management solution!
Finally, Key Coin Assets would love to help you learn more about this evolving space. Aside from crypto and blockchain knowledge, we can also help you make wise investment decisions to help you reach your financial goals. Contact us NOW at 843-886-9547 to start investing in yourself!