Crazy For Crypto? 20 Terms You Must Know Before Investing In Cryptocurrency
Are you amongst those intrigued by the boundless opportunities to get rich through the cryptocurrency world? If yes, then remember it doesn't make sense to kickstart crypto investing without being aware of the must-know terms! So, before you begin to put your hard earned money into crypto, grab hold of some of the important terms related to it.
Are you crazy about crypto? Intrigued by the boundless opportunities to get rich through cryptocurrency? Want to unlock the potential of earning money by investing in cryptocurrency?
If the answers are yes, then wouldn't it be prudent to first learn the basic terms associated with crypto? In fact, it doesn't make sense to kickstart crypto investing without being aware of the must know terms! So, before you begin to put your hard-earned money into crypto, grab hold of some of the important terms related to it.
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1. Altcoin: Formed from the words "alternative" and "coin", altcoin means all alternatives to Bitcoin. This term is usually used to refer to all cryptocurrencies that aren¡¯t Bitcoin. Hence, altcoin describes all non-Bitcoin cryptocurrencies.
2. Address: An address is a string of characters that functions as a place where individuals can send, receive or store cryptocurrency. Just like any telephone number or zip code, every crypto address is unique.
3. Bitcoin Maximalist: This term refers to a person who believes that Bitcoin is the one and only cryptocurrency of value. Bitcoin maximalists believe that bitcoin is the only digital asset that will be needed in the future and all other digital currencies are inferior to Bitcoin.
4. Blockchain: Blockchain is a digital ledger and distributed database containing all the verified transactions made on a particular cryptocurrency. It electronically stores all the information collected in groups together, securely in digital format.
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5. Cryptocurrency exchanges: Cryptocurrency exchanges are online platforms wherein you can exchange one kind of digital asset for another, based on the market value of the given assets. You can buy, sell, and trade cryptocurrency on such exchanges. Some of the cryptocurrency exchanges in India include Unocoin, CoinSwitch Kuber,WazirX,Zebpay,CoinDCX.
6. Ethereum: Ethereum is a decentralized, open-source blockchain that possesses smart contract functionality. Ether is the native cryptocurrency of the platform. Amongst cryptocurrencies traded globally, ether is second only to Bitcoin in terms of market capitalization.
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7. Blocks: Blocks are what make up a blockchain. Each block carries a historical database and set of information of all the transactions conducted on a crypto.Blocks have certain storage capacities and, when filled, they are closed and linked to the previously filled block, hence forming a chain of data known as the blockchain. All new information that follows that freshly added block is compiled into a newly formed block that will then also be added to the chain once filled. This way, the blockchain goes on.
8. dApps: This is the short form for ¡°decentralized app,¡± implying any digital application or program that runs on a blockchain or P2P network of computers instead of a single computer.dApps can take various forms, like mobile games, communications platforms, and social media sites.
9. DeFi: DeFi is the short form for Decentralized Finance, which is a blockchain-based form of finance that does not rely on central financial intermediaries like brokerages, exchanges, or banks to offer traditional financial instruments. It implies the movement within crypto to not just trade decentralized currencies but do so in such a way that is itself decentralized. Some of the most popular DeFi projects are decentralized exchange protocols, which automate the exchange of cryptocurrencies among buyers and sellers, hence eliminating the need for a middleman.
10. Fork: A fork is when a cryptocurrency or blockchain-based network splits off into two distinct potential paths/projects with their own code and set of governing principles. In case of a soft fork, only one blockchain will remain operational, whereas in case of hard forks, the result is two new brand chains.
11. Hodl: No it's not a misspelling. Hodl is in fact a slang in cryptoworld, that stands for the word Hold, and is often even termed as an acronym for ¡®hold on for dear life¡¯. When crypto stumbles, loyal investors tend to urge each other to ¡®Hodl¡¯ and not sell their tokens, with the belief that the price will rise.
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12. Bitcoin: The most popular term in crypto-world is Bitcoin. It is a digital currency and a decentralized system that records transactions in a distributed ledger called a blockchain. It operates free of any central control or the oversight of banks or governments. Instead it relies on peer-to-peer software and cryptography.
13. NFT: Non-fungible Token (NFT) is a digital asset that confers ownership of a virtual good, such as a piece of digital artwork or online collectibles. Most cryptocurrencies are ¡°fungible¡±, implying that there is no meaningful distinction between one coin and another. Whereas NFT is a unique and non-interchangeable unit of data stored on a digital ledger, and it can take any form of unique items like photos, videos, audio, and other types of digital files, with ownership rights verified and stored on a blockchain.
14. Pump and Dump: Pump and Dump is a form of price manipulation wherein the price of a crypto is boosted based on false recommendations (pump) and then the assets are sold at a higher price (dump).
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15. Satoshi: This crypto term is deemed to have one of these meanings.. The first is in reference to Satoshi Nakomoto, the anonymous founder of Bitcoin, authored the bitcoin white paper, and created and deployed bitcoin's original reference implementation. Secondly, Satoshi also means a unit of exchange, equal to .0001 Bitcoins.
16. Token: A token is a virtual currency¡¯s unit or denomination, and represents a tradable asset or utility that resides on its own blockchain and allows the token holder to use it for investment or even economic purposes.
17. To the Moon: When someone posts a rocket emoji or says To the Moon, it implies that the person thinks the price of a cryptocurrency is expected to witness a big boost/increase.
18. Rekt: This is another crypto slang, that means "wrecked." It's used when an investor or trader loses a substantial amount of money in cryptocurrency..
19. Wallet: A cryptocurrency wallet is a place to store tokens. But not all crypto wallets are the same or equal. ¡°Hot¡± wallets are online, meaning crypto tokens are easily accessible but also more susceptible to hackers. ¡°Cold¡± wallets store digital assets offline, thus making them more secure but also difficult to trade.
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20.Whale: This term is used for those who are individual investors and often sophisticated trading firms with large amounts of Bitcoin as well as other cryptocurrency. They are feared and respected among crypto day traders for their ability to impact the movement of prices with single trades.
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