Crypto Glossary for beginners
Cryptocurrency is difficult. The rich plethora of different words used when discussing cryptocurrency trading and the cryptocurrency market, in general, doesn’t help either. In our venture to make the cryptocurrency market available on equal terms to everyone, we thought that it would be helpful to compile some of the most used terms in a cryptocurrency glossary. Said and done. This is our contribution (or rather, one of our contributions) to helping people understand crypto.
Many of the terms explained in this Cryptocurrency Glossary have been invented at different cryptocurrency forums – the most prominent being Bitcointalk.org (all hail Bitcointalk!). Other terms are “regular” trading terms that have been around for a long time. These are essentially just reapplied to the cryptocurrency market. Different from most other cryptocurrency glossaries, this cryptocurrency glossary will provide you with the term (in H3-format), followed by an explanation of the term, and then a reference usage example. We are deeply inspired by Urban Dictionary in this regard and any similarities to their reference examples are fully intentional. Reference examples might sometimes be useful, and sometimes totally superfluous. Sometimes they are purely for comic effect.
We have made the cryptocurrency glossary alphabetical, instead of dividing it into groups. We’re sure this makes it more difficult to study the dictionary (as if studying for an exam), but on the other hand, none of you would do that. You surely just happened to arrive at this post after searching for a term at Google. Anyway, here we go!
Meaning: Airdrop is an ICO distribution method that occurs via a hard fork attempt, free of charge. Airdrops can come as a surprise or be announced beforehand. Term used in a sentence: I would never buy that cryptocurrency, it’s worthless. But hey, I got the units through an airdrop so no harm in that I guess.
Meaning: Altcoin generally means any cryptocurrency other than Bitcoin or Ethereum (although there are some people that still claim that Ethereum is an altcoin). Term used in a sentence: Man, Bitcoin is yesterday’s news. I’m all into altcoins now. It’s with the altcoins you can make the really big bucks.
Meaning: ANN is short for announcement and most commonly refer to announcements of a new ICO or a new product or service on the forum Bitcointalk. Term used in a sentence: Did you see the ANN for that Russian ICO? Filled with typos and everything. I’m staying away from that.
Meaning: Arbitrage means taking advantage of a difference in the price of the same commodity or instrument on two different exchanges. For instance, if a cryptocurrency is being sold for USD 10.00 at Exchange A, and being bought for USD 10.50 at Exchange B, the arbitrage opportunity would be to buy the cryptocurrency at Exchange A and then immediately sell it at Exchange B. The arbitrage profits would then be USD 0.50. Term used in a sentence: Have you heard that the updates of centralized exchange X’s market price for cryptocurrencies that they sell themselves are lagging behind? Sometimes up to a minute. I’m definitely going to try some arbitrage trading there.
Meaning: Ask Price is the price a seller is willing to accept for a cryptocurrency. Along with the price, the ask quote will generally also stipulate the number of units of such cryptocurrency willing to be sold at that price. When somebody matches the Ask Price, an order is made. Term used in a sentence: Your trading technique is really weird my friend. Your ask price is completely unreasonable, nobody will buy it at that price.
Meaning: ATH means “all-time high”, as in “all-time price high.” In the context of cryptocurrencies, it refers to the highest price milestone that any given coin or token has ever achieved. Term used in a sentence: When Bitcoin was at its ATH, I was seriously checking out Lambos online. Found a really nice one in Germany that I was minutes from buying. Now, one month later, I’m looking at skateboards instead…
Meaning: Bagholder means someone who is still holding an altcoin after a Pump and Dump crash. It can also just refer to someone holding a coin that is sinking in value with few future prospects. Term used in a sentence: Look at John, he refuses to accept that the crypto he invested in never will recover. He’s such a bagholder.
Meaning: A Bear is someone who thinks the market value will go down. A bear market is a prolonged period of falling prices. Term used in a sentence: – Bitcoin is going to hell! I promise you. A few weeks from now, it won’t even be worth a dollar. – You’re such a bear, John…
Meaning: Bear Trap is a situation where the price goes down and then sharply back up “trapping” Bearish speculators who sold their positions. Term used in a sentence: The prices of Dogecoin have been going down abnormally fast lately. Do you think it could be a bear trap?
Meaning: When the market is bearish, market participants are expecting that the price will decrease. Term used in a sentence: – Do you think that now could be the right time to invest in cryptocurrencies? – Not sure. The market is a bit bearish at the moment. I would probably wait a little bit longer.
Meaning: Bid Price is the opposite of Ask Price. It is the price a buyer is willing to pay for a certain cryptocurrency and the number of units of such cryptocurrency to be bought at that price. Term used in a sentence: I don’t want to hustle with bid prices far from the ask price. When I want something, I buy it at the current market rate. Who knows, it might become even more expensive in the blink of an eye.
Meaning: Block is a record of all or some of the most recent transactions in a certain cryptocurrency. Term used in a sentence: – What is a block, John? – It is a record of all or some of the most recent transactions in a certain cryptocurrency. Any further questions?
Meaning: Block Reward is a reward given to miners. It is “new cryptocurrency units” (not previously held by anyone but created for the purpose of the reward), provided each time a miner successfully publishes a block. Term used in a sentence: I only use my super expensive mining rig for mining cryptocurrencies that have block rewards that are high enough. It’s just a waste of my time otherwise.
Meaning: Blockchain is the classification of a technology. Blockchains are distributed ledgers, secured by cryptography. They are essentially public databases that everyone can access and read, but the data can only be updated by the data owners. Instead of the data residing on a single centralized server, the data is copied across thousands and thousands of computers worldwide. Term used in a sentence: – How should I secure financing for my new cryptocurrency project, John? – Just speak fast and say blockchain as often as you can and the Venture Capital firms will shower you with money.
Meaning: Bollinger Band (in short: BBands) means a margin around the price of a crypto that helps indicate when a coin is overbought or oversold. The Bollinger Bands, developed by legendary technical trader John Bollinger. The term has nothing to do with the classic champagne. Term used in a sentence: Looking at the Bollinger Bands, I’m quite sure that Monero is being overbought. My recommendation would be to apply caution.
Meaning: Bounty is a sum of money offered as a reward for completing a specific task. The reward is normally given to the first person to satisfactorily complete the relevant task. There are several different types of bounties. One usual type is the “bug bounty” given to a person finding a bug on a company’s website or in a company’s product etc. Term used in a sentence: I found a bug on that new ICO’s website. It’s too bad that they don’t have any bug bounties.
Meaning: Brain Wallet refers to the concept of memorizing a passphrase. Such passphrase will be used to generate all your private keys and addresses. It should be noted that if you forget your passphrase then your cryptocurrencies are lost forever. Term used in a sentence: – How do you secure your cryptocurrencies? Are you using a hardware wallet? – Nah man I’m using my brain wallet. – John, you’ve been smoking so much weed that I really don’t think your brain wallet is that secure…
Meaning: Bull is the opposite of Bear. Bulls think the market value will go up. A bull market is a prolonged period of rising prices. Term used in a sentence: I met a guy last night who said that Bitcoin would be worth USD 1 million in 1 year. What a bull…
Meaning: Bull Trap is an upwards trend in price that invites bullish speculators to buy before reversing suddenly and “springing the trap”. Term used in a sentence: Well, my suicide thoughts started back in December 2017. I mortgaged my house and spent all my savings on Bitcoin. I thought it would never stop increasing in value! Turns out it was just a bull trap. My wife left me after that as well. She took the kids too.
Meaning: When the market is bullish, it is expecting that the price is going to increase. Term used in a sentence: – Have you seen the price changes on DASH today, John? – Yes, most other cryptocurrencies are up today too. But I don’t think it will stop there. I’m bullish right now.
Candle / Candlestick
Meaning: A Candle or a Candlestick is a form of price chart, showing the highest price, the lowest price and the opening and closing prices of a cryptocurrency during a certain period (normally a day). If the price is higher at the end of a trading day than the opening price such day, the candle will be green (or white) and if it is lower, the candle will be red (or black). Term used in a sentence: I’m SO happy that I went short on Bitcoin last week, have you seen the candlesticks this week? Red as blood, all week.
Meaning: Client refers to the software application used to send and receive cryptocurrency transactions. Term used in a sentence: I use the Bitcoin Core Client for my Bitcoin-transactions.
Meaning: Cold Storage has nothing to do with temperature, but is the process of moving cryptocurrency ‘offline’, as a way of safekeeping your crypto-currency from hacking. There is a variety of ways to do this, but some methods most commonly used include: (i) Printing out the QR code of a software wallet and storing it somewhere safe, such as a safety deposit box, (ii) Moving the files of a software wallet onto a USB drive and storing it somewhere safe, or (iii) Using a hardware wallet. Term used in a sentence: – John, how can I avoid getting hack? – It’s called getting “hacked”, grandma. And don’t worry, I’ve put all your Tittiecoins in cold storage.
Meaning: Confirmations refers to the depth of the block containing your transaction in the blockchain. When a block is published it has a depth of 0 as it is the top block. As more blocks are published the previous blocks get deeper in the chain. Term used in a sentence: Are you sure the transaction was executed? Yeah, totally, it’s been subject to more than 100 confirmations now.
Meaning: DAG is an acronym for Directed Acyclic Graph. Term used in a sentence: – Dad, how does Wikipedia define DAG? – Well, son, Wikipedia defines DAG as “a finite directed graph with no directed cycles. That is, it consists of finitely many vertices and edges, with each edge directed from one vertex to another, such that there is no way to start at any vertex v and follow a consistently-directed sequence of edges that eventually loops back to v again. Equivalently, a DAG is a directed graph that has a topological ordering, a sequence of the vertices such that every edge is directed from earlier to later in the sequence.”
Meaning: DAO is an acronym for Decentralized Autonomous Organization. A DAO can (at least theoretically) run itself without any involvement of individuals and can thus be completely autonomous.Term used in a sentence: I wonder if there’s a place for board of directors in the future, or if all Forbes 500-companies will just be run as DAOs.
Meaning: Dapp means Decentralized Application, which is an application that uses an Ethereum smart contract as it’s back-end code. Term used in a sentence: Ethereum’s white paper says that there is three different Dapps: (i) money managing dapps, (ii) dapps involving money but also something else, and (iii) “other” Dapps. This essentially means that there could be thousands of Dapps.
Meaning: Most exchanges charge deposit fees when you deposit fiat currency on the exchange. This fee is sometimes a fixed fee (triggered every time you make a deposit), and sometimes a percentage of the total deposit value. Deposit fees can be particularly high when you deposit via credit card (for the exchanges accepting credit card deposits at all). Term used in a sentence: Can you believe it? The exchange charged a deposit fee amounting to 11.5% for my credit card deposit! Thieves!!!
Meaning: Deterministic Wallet is a wallet that you need to backup only once. It creates all your bitcoin addresses and private keys, from a random number called a “seed”. Your wallet can be recovered from the seed, if the wallet file is accidentally deleted. Term used in a sentence: I’m using a deterministic wallet, so I have only had to backup the wallet once. How about you? How do you protect your “future Lambo”-money?
Meaning: Term used in a sentence: – I finally did it! – You did what, John? – I managed to double-spend a few of my Bitcoins! – That’s hurtful to the community, John. You should be ashamed.
Meaning: Exchange means a website where you can buy and sell cryptocurrencies.
Meaning: FA is an acronym for Fundamental Analysis. When doing a Fundamental Analysis, you not only analyse the price changes and Resistance and Support of a certain cryptocurrency, you look at the a wide variety of factors relevant to the cryptocurrency. These factors include, but is not limited to, demand for the cryptocurrency, supply of the cryptocurrency, the technology behind the cryptocurrency, upcoming upgrades of the technology behind the cryptocurrency, news surrounding the cryptocurrency etc. Term used in a sentence: You do your Technical Analysis (TA), that’s just nonsense if you ask me. I only look at the Fundamental Analysis, that’s how you really understand what you’re buying and selling.
Meaning: Faucet is a site that gives out small amounts of free coins in order to get newbies started. One such site is Freebitco.in. Term used in a sentence: I don’t have a single cryptocurrency unit, but I’m trying to find a few faucets now where I can get my first. It’s not much, but it’s a start!
Meaning: Fiat currency means currency that a government has declared to be legal tender, but it is not backed by a physical commodity. Examples of Fiat currency is USD and EUR. The value of fiat currency is derived from the relationship between supply and demand rather than the value of the material that the money is made of. Fiat is Latin for “let it be done.” Term used in a sentence: – Man have you seen the price of Ethereum Classic? You gotta buy it now! – Can’t. I don’t want to sell any of my other cryptos and I’m out of fiat currency.
Meaning: The Flippening has nothing to do with iCloud leaks of celebrity photos but refer to a potential future event wherein Ethereum’s market cap surpasses Bitcoin’s market cap, making Ethereum the most ‘valuable’ cryptocurrency. Term used in a sentence: – So, have you done any in-depth studies of the Flippening? – Oh, yes. Very much so… – What’s your view on Ethereum’s race past Bitcoin, then? – What’s Ethereum?
Meaning: FOMO means Fear Of Missing Out. In the cryptocurrency markets, the expression is most often used to describe the feeling that you need to get on the train when the price of something starts to skyrocket. Term used in a sentence: – Why did you invest in Bitcoin in late December 2017, John? – FOMO, man. FOMO.
Meaning: Fork means a situation where a blockchain splits into two separate chains. Forks generally happen in the crypto world when new ‘governance rules’ are built into the blockchain’s code. Term used in a sentence: Bitcoin Cash is a fork of Bitcoin.
Meaning: FUD means Fear, Uncertainty, and Doubt. FUD is essentially negativity without cause that is spread intentionally by someone that wants the price of a cryptocurrency to drop. Term used in a sentence: – Hey man did you hear that there’s a vulnerability in Bitcoin’s blockchain and that it will lead to hacks and that this means that Bitcoin is virtually useless? – Stop spreading FUD, John.
Meaning: FUDster means someone who is spreading FUD. Term used in a sentence: – Hey man did you hear that there’s a vulnerability in Bitcoin’s blockchain and that it will lead to hacks and that this means that Bitcoin is virtually useless? – Stop being a FUDster, John.
Meaning: Gas is a measurement of how much processing that is required by the Ethereum network to process a transaction. Simple transactions, like sending ether to another address, typically do not require much gas. More complex transactions, like deploying a smart contract, require more gas. Term used in a sentence: – Gas? What do you mean? Can I get gas down at the petrol station? – No, grandma. Gas is a measure of processing power in the Ethereum network. – …what? Explain again my dear little boy.
Meaning: Gas Price means the amount of ether to be spent for each gas unit on a transaction. The initiator of a transaction chooses and pays the gas price of the transaction. Transactions with higher gas prices are prioritized by the network. Term used in a sentence: What was the gas price for that transaction? Not much just a few hundred Gweis.
Meaning: The Genesis Block is the first block of the blockchain of Bitcoin ever released. It was released by Satoshi Nakamoto on 4 January 2009. Term used in a sentence: – I was there when the Genesis Block was released. – What do you mean, John? – I know Satoshi Nakamoto. – You’re a compulsive liar, John. – I can bench-press 1100 pounds. – Shut up, John.
Meaning: Git is a distributed revision control and source code management system focusing on speed. It enables software developers to work together as a team remotely from anywhere in the world. Git is a free software. For more information, see Git. Term used in a sentence: – Can you explain what Git means, John? – No, the Git-system is a little too difficult for me to explain.
Meaning: GitHub is a web-based hosting service for projects that use the Git revision control system. Access GitHub here. Term used in a sentence: There are a lot of talented developers hanging out on GitHub.
Meaning: Going Long means a margin trade that profits if the price of the relevant cryptocurrency increases. Term used in a sentence: – Do you think I should be going long in The Billion Coin? – The Billion Coin is a scam, John. Wake up. Smell the coffee.
Meaning: Going Short means a margin trade that profits if the price of the relevant cryptocurrency decreases. Term used in a sentence: – I’m going short in ZCash! – Nobody cares about you or your investments, John.
Meaning: Goxxed comes from the infamous MtGox, which was a bitcoin exchange that many claim was plagued with technical problems. The term goxxed refers to being impeded by technical issues. Term used in a sentence: I wanted to subscribe for tokens in that new ICO. But I couldn’t get past the KYC-bot in the Telegram-channel. I was goxxed.
Meaning: GPU is an acronym for Graphics Processing Unit. It can be used to play games or mine cryptocurrencies. Term used in a sentence: – What did you do with all the stolen goods from that robbery, John? – I bought a hardcore GPU. I’m leaving the criminal life now, I’m going to start mining and become rich in cryptocurrencies instead.
Meaning: Gwei is a denomination of Ether (the Ethereum currency). Gas prices are most often measured in Gwei. 1 Ether = 1 billion (1,000,000,000) Gwei. (109) Term used in a sentence: I’m so broke right now. No fiat money and not even a single Gwei in my crypto wallet. Only a few Weis.
Meaning: Hard Fork occurs when there are a sufficient number of clients on the network that disagree on the rules about how blocks are created and recorded in the blockchain. It leads to a split in the chain, one set of clients follow one branch and another set follows the other. To fix hard forks, some action must be taken by the holders of the relevant cryptocurrency. Term used in a sentence: Bitcoin Cash is a hard fork of Bitcoin.
Meaning: Hardware Wallet means a device that can securely store cryptocurrency. Term used in a sentence: I’m just too lazy and sloppy to have a web wallet. Paper wallets are not for me and I can’t really keep track of anything, so brain wallet is out of the question. The only solution for me is to have a hardware wallet in my key ring.
Meaning: Hash Rate is a unit of mining performance expressed as follows: 1 h/s = 1 hash per second 1 Kh/s = Kilohash per second. 1,000 h/s 1 Mh/s = Megahash per second. 1,000 Kh/s (1,000,000 h/s) 1 Gh/s = Gigahash per second. 1,000 Mh/s (1,000,000,000 h/s) 1 Th/s = Terahash per seond. 1,000 Gh/s (1,000,000,000,000 h/s) Term used in a sentence: I bought a Zotac GTX 1080 Mini the other day. A bit disappointed over the hash rate. I thought that graphics card would help me achieve an even higher hash rate.
Meaning: HODL stands for Hold On for Dear Life, and describes the process of not selling cryptocurrency in spite of market movements. Term used in a sentence: My cryptocurrency investment strategy is this: HODL, just HODL.
Meaning: HODLACL stands for Hold On for Dear Life And Complain a Little, and describes the process of HODLing while also complaining about e.g. volatility. Term used in a sentence: – I mean, I’m HODLing, but the volatility man! It drives me crazy to see these drops every other day. – Quit HODLACLing, John.
Meaning: Hot Wallet is a wallet that is accessible via the web or another network connection. Hot Wallets are vulnerable to many online attacks and are not as secure as their Cold Wallet (Cold Storage) counterparts. Term used in a sentence: I don’t care about security. I have all my cryptos in a Hot Wallet.
Meaning: ICO means “Initial Coin Offering” and is similar to an “IPO” in the non-crypto world. Read more about the difference between ICOs and IPOs here. In an ICO, startups issue their own token in exchange for ether. This is essentially crowdfunding on the ethereum platform. Term used in a sentence: I used to be broke, going from pay check to paycheck, but then I borrowed 100,000 USD and invested it in XTRABYTES’ ICO. Now I own a small castle and two yachts.
We don’t know any cryptocurrency terms starting with “J”. But we hate incompleteness. Please let us know if you know any cryptocurrency term starting with “J”!
Meaning: KYC is an acronym for Know Your Customer. It is legal requirements to make a reasonable effort to confirm your costumers true identity. This process is intended to help prevent money laundering. Term used in a sentence: I hate KYC-procedures. I never look good when taking a selfie holding my passport next to my face.
Meaning: The meaning of “Lambo” is exactly what you would expect. It simply stands for “Lamborghini”, the Italian supercar brand. The term is mostly used as a trophy cryptocurrency traders is dreaming to get when being successful enough in their cryptocurrency investments. Check out which Lambo you want to dream about on their official website. Term used in a sentence: – Hey John, I heard you got divorced? – Yeah, my wife found a guy with a Lambo and within a week from that she sent in the divorce papers and changed her last name back to her maiden name. Can’t blame her though, a Lambo is a Lambo.
Meaning: Limit Order means an order placed by traders to buy or sell a cryptocurrency when the price meets a certain amount. They can be thought of as ‘for-sale’ signs. These orders are what are bought and sold against when traders place market orders. Term used in a sentence: You should always place limit orders. That way you know you won’t be screwed by high-frequency trading bots.
Meaning: Liquidity (or market liquidity) is an asset’s ability to be sold without causing a significant movement in the price and with minimum loss of value. Liquidity is characterized by a high level of trading activity. Assets that can be easily bought or sold are known as liquid assets. Term used in a sentence: There is no liquidity at all in that crypto. It’s like one trade a day and that causes price swings with 35-40%.
Meaning:MACD stands for Moving Average Convergence Divergence, which is a trend indicator that shows the relationship between two moving averages of prices. Term used in a sentence: – Dad, do you know any difficult trading concepts to explain? – Sure, son, MACD – the Moving Average Convergence Divergence – is very difficult to explain.
Meaning: Mainnet is a blockchain in operation where you are also able to transfer cryptocurrencies to different recipients. This is different from a Testnet where you can’t make such transfers. Term used in a sentence: After running the Testnet for a few months, the company XYZ has now launched the Mainnet and sending/receiving real tokens is finally possible.
Meaning: The Manipulator is a real or an imagined agent who controls the market value with his vast reserves of fiat currency and cryptocurrency. Term used in a sentence: God damn it! This must be the Manipulator again. I hate that guy.
Meaning: Margin Call is a “call” made by a lender, broker or exchange to the person who has made the margin trade. The call is made when the margin falls below the minimum required to cover the credit risk of the lender, the broker or exchange. At such point, the position is automatically closed and the margin is lost. You don’t want to get this “call” if you’re a trader… Term used in a sentence: I made a leveraged trade yesterday and it isn’t looking too good at all. I just hope I don’t get that margin call if you know what I mean.
Meaning: Margin Trading means the act of adding leverage to your trades. When margin trading, you borrow money against your current funds to trade cryptocurrency “on margin” on an exchange. In other words, you borrowing money to increase your buying power (generally you pay interest on the amount borrowed, but not always). Term used in a sentence: You must have nerves of steel to do the kind of margin trading I do, Bitcoin long with 100x leverage. Go big or go home!
Meaning: Market Capitalisation (for short: Market Cap) is total value of a cryptocurrency. It is calculated by multiplying the total supply of coins by the current price of one such coin. Term used in a sentence: The market capitalisation of Bitcoin was 116.5 billion in November 2017. That means that Bitcoin was then the world’s 59th biggest economy (bigger than e.g. Kuwait).
Meaning: Market Order means a simple purchase or sale on an exchange at the current price. Market buys purchase the cheapest ETH available on the order book, and market sells fill the most expensive buy order on the books. Term used in a sentence: I’m not that worried about high-frequency trading bots. I just want the cryptocurrencies that I’m looking for, immediately when I want them. That’s why I always make market orders.
Meaning: MEW stands for MyEtherWallet, one of the most popular free online open-source wallets. Term used in a sentence: – Do you know where to store Ethereum and ERC20-tokens? – There are loads of alternatives, but I use MEW.
Meaning: Mining is the process of trying to solve/create the next block. It requires large amounts of computer processing power to do effectively, and is therefore also rewarded with ether. Term used in a sentence: How do you get rich mining? Well, you can start with getting a proper mining rig and focus on mining promising cryptocurrencies with high block rewards.
Meaning: Mining Rig means a computer specially designed for processing proof-of-work blockchains. They often consist of multiple high-end graphic processors (GPUs) to maximize their processing power. Term used in a sentence: You should see my new mining rig. It’s really powerful. Hope my mom doesn’t notice that our electricity bill is 132 times higher each month since I got it though.
Meaning: Mooning means – in the crypto world – the price of a cryptocurrency going up to astronomical levels. Term used in a sentence: – I promise you, man! PIVX Coin is mooning! You have to get it know. – You have said that about every coin you have read the whitepaper for, John. And you have been wrong every time.
Meaning: Multi-sig is a system that requires multiple cryptographic authentication keys. Term used in a sentence: I used to have insomnia, but since I fixed multi-sig security on all of my crypto stuff I’m sleeping like a baby every night.
Meaning: Node means a computer that possesses a copy of a blockchain and is working to maintain it. Term used in a sentence: – I’m contributing to the crypto community, dad. Our family computer is also a node. – I don’t want this family’s computer to be a gnome, John. – A node! – A what? – Nevermind.
Meaning: Orphaned Blocks is the term for certain blocks following a Soft Fork or Hard Fork, or when miners produce blocks at exactly the same time. Whenever a Soft Fork or Hard Fork occurs, the blockchain is split into two paths. One of these chains will eventually be considered the valid one, and the other will be the invalid chain. Blocks that are in an invalid chain are called Orphaned Blocks. Term used in a sentence: When two miners produce blocks at exactly the same time, one of those blocks will not be part of the main chain. They will be so called orphaned blocks.
Meaning: OTC is an acronym for Over The Counter. This is off-exchange trading that is done directly between two parties. Term used in a sentence: I want to know who I’m trading with. That’s why I only trade OTC with people I trust.
Meaning: Paper Wallet is a way to store cryptocurrency. It is done by printing the addresses and private keys directly on a piece of paper (or any other material). Term used in a sentence: – Hello? – Hello, is this John? – Yes, speaking. – I’m from the fire department and I’m sorry to say this, John, but your entire house has burned down. Everything in there is gone. – OH NO I HAD MY PAPER WALLET IN THE HOUSE!!!
Meaning: Ponzi Scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors. The term comes from the infamous Charles Ponzi and his arbitrage affairs with international reply coupons during the 1920s. Term used in a sentence: I’m pretty sure that this ICO is a Ponzi Scheme, but it doesn’t really matter to me. If you’re one of the first people entering the scheme and you exit in time, you can still reap the benefits of it.
Meaning: Pool is a group of miners that all work together in order to improve their chances of solving a block. Term used in a sentence: Ever since I joined that mining pool, the compensation I receive for mining has started to improve.
Meaning: POS stands for Proof of Stake (not Piece of Shit…) and is the proposed future consensus algorithm to be used by Ethereum. Instead of mining in its current form, people that own ETH will be able to ‘lock up’ their ether for a short amount of time in order to ‘vote’ and generate network consensus. The plan is that these stakeholders will be rewarded with ETH by doing so. Another famous POS blockchain is LISK. Term used in a sentence: How are new transactions validated in the DASH-crypto? They are validated through POS.
Meaning: POW stands for Proof Of Work (not Prisoner Of War…) and is the current consensus algorithm used by Bitcoin. Term used in a sentence: How are new transactions validated in the Super Bitcoin-cryptocurrency? They are validated through POW.
Meaning: Pre mining is the procedure of mining certain altcoins before they are released to the public. This generates coins for the developers, who hope to profit from them in the future. Term used in a sentence: The pre mining in this ICO is absolutely insane. Seems like a fraud to me. Watch out.
Pump and Dump
Meaning: Pump and Dump means an altcoin getting a lot of attention, resulting in a fast price increase, which is then followed by a crash. Term used in a sentence: – What happened? I thought that crypto was going to the moon but now the price is even lower than what I bought it for? – It was a classic Pump and Dump, John. Get over it.
We don’t know any cryptocurrency terms starting with “Q”. But we hate incompleteness. Please let us know if you know any cryptocurrency term starting with “Q”!
Meaning: Resistance is the opposite of support, and is a trading term denoting a price level that a certain cryptocurrency rarely or never will exceed. If Bitcoin’s resistance would be USD 20,000, the price of Bitcoin could go up to USD 20,000 (maybe even several times), but not exceed USD 20,000. Term used in a sentence: – What do you think about the Bitcoin, will it surpass USD 25,000 this year? – Don’t know man, there is definitely resistance at the USD 20,000 level. But if Bitcoin manages to break that resistance, who knows where it will stop.
Meaning: ROI stands for Return On Investment and is the percentage of how much money has been made compared to an initial investment (i.e., 100% ROI means someone has doubled their money). Term used in a sentence: – I doubled my money during 2017. ROI x 2. How about that? – That’s nice John. I invested all of my money in XTRABYTES. ROI during 2017 was 3879.99. – …
Meaning: RSI is an acronym for the Relative Strength Index, being an indicator looking at the magnitude of recent price changes. The RSI is used to analyze whether a certain cryptocurrency is oversold or overbought, which in turn makes it possible to analyze whether it is an appropriate time to buy or sell. Term used in a sentence: Looking at Ripple’s RSI, I see clear purchase signals right now. I’m definitely going in hard.
Meaning: Scamcoin is an altcoin created for the sole purpose of conning people out of their money. Term used in a sentence: – So, have you seen any Scamcoins in the market lately, John? – Yeah, I lost all of my pension savings in a Scamcoin last month.
Sell Wall/Buy Wall
Meaning: Sell Wall and Buy Wall means the current limit buy and sell points, as presented in a depth chart. The graphical representation on the depth chart looks like walls. Term used in a sentence: You see these Sell Walls and Buy Walls? My interpretation of this order depth chart is that the price will increase due to higher buy pressure.
Meaning: SHA-256 stands for Secure Hash Algorithm. It is an algorithm that generates a hash when provided with input data. Term used in a sentence: – Can you please use SHA-256 in a sentence, John? – No, I’m too lazy.
Meaning: Sharding is a scaling solution for blockchains. Every node in a blockchain network typically houses a complete copy of the blockchain. Sharding is a method that allows nodes to have partial copies of the complete blockchain in order to increase overall network performance and consensus speeds. Term used in a sentence: – Through sharding, the different nodes in a network can work more efficiently. – Did you just say sharting? – No, John, sharding.
Meaning: Shilling/Pumping means strongly advertising a cryptocurrency. If a cryptocurrency is promised to cure cancer or be the second coming of Jesus, it’s being shilled/pumped. Term used in a sentence: I’m pretty sure that cryptocurrency is getting shilled. It can’t possibly be as good as promised.
Sig & Signature
Meaning: Sig (or Signature)is a cryptographic authentication key. Term used in a sentence: I’ll be with you in a minute I just need to verify a transaction with my sig.
Meaning: Smart Contract means a code that is deployed onto the Ethereum blockchain, often directly interacting with how money flows. Simplistically put, a normal transaction allows you to send money from A to B. Smart contracts allow you to send money from A to B, on the condition that C happens. Term used in a sentence: – What’s so smart about smart contracts? – Well, for one, they execute themselves. – I had a cousin who accidentally executed himself. He wasn’t that smart.
Meaning: Sockpuppet is an online identity used for the purposes of deception. Term used in a sentence: I’m pretty sure that the account 1337CryptoHero is a sockpuppet.
Meaning: Soft Fork is a situation where two or more competing blocks are published at the same height in the blockchain. These kinds of forks will solve themselves without any intervention from holders of the relevant cryptocurrency. Term used in a sentence: Don’t worry about that soft fork. It doesn’t require any action on our part.
Meaning: Software Fork is the procedure of splitting an open-source software project into two projects by copying the original project and developing it independently from that point onwards. Term used in a sentence: Due to differences among the members of the development team, they have now decided to do a software fork and thereafter work independently from each other.
Meaning: Software Wallet means a storage for cryptocurrency that exists solely as software files on a computer. Software wallets can be generated for free from a variety of sources. Term used in a sentence: There are many differences between a software wallet and a hardware wallet. One such difference is that a software wallet doesn’t exist in physical form.
Meaning: Solidity is one of the most popular languages that smart contracts can be written in on Ethereum. Term used in a sentence: Can you write in Solidity? No, I only speak English and emojis.
Meaning: Spread is the amount by which the Ask Price exceeds the Bid Price. This is essentially the difference in price between the highest price that a buyer is willing to pay for a cryptocurrency and the lowest price for which a seller is willing to sell it. Term used in a sentence: By giving makers a discount on the trading fees, the exchange promotes liquidity and tightens the bid-ask spread.
Meaning: SPV Client stands for Simplified Payment Verification Client. It is a lightweight client that downloads only part of the relevant blockchain. Term used in a sentence: What’s that you have there on your computer, John? It’s an SPV Client.
Meaning: Stable Coin means a cryptocurrency with extremely low volatility that can be used to trade against the overall market. A “stable coin” is a cryptocurrency that is often pegged to another stable asset, like silver, gold, or a fiat currency such as the US dollar. It’s a currency that’s global, but not tied to a central bank and has a lower volatility than other cryptos. Examples of stable coins on the market today are: (i) Havven, (ii) MakerDao, (iii) Basis, and (iv) Tether. Term used in a sentence: After being a successful cryptocurrency trader for more than a year, I decided to park my cryptos into a stable coin. I was worried about possible price decreases at that point, and rightly so.
Stop Loss & Stop Order
Meaning: Stop Loss-order (or Stop Order) is an order designed to limit an investor’s loss on a security position. Setting a stop loss order for 10% below the price you paid will limit your loss to 10%. This strategy allows investors to determine their loss limit in advance. Term used in a sentence: – Man! I lost everything. All of my savings. My college fund. It’s all gone! – I set a 5% stop loss-order, so I just lost 5%. I must have forgotten to tell you to do the same. Sry.
Meaning: Support is the opposite of resistance and is a trading term referring to a certain price that a cryptocurrency historically does not fall below. If Bitcoin’s support would be USD 5,000, it would mean that the price of Bitcoin rarely or never falls below such level. Term used in a sentence: – I’m HODLing Bitcoin, I really am, but I don’t know how much longer I can take it? I’m afraid I might lose everything! – No you won’t, there’s solid support at the USD 5,000 level so the price of Bitcoin won’t go lower than that.
Meaning: TA stands for Technical Analysis (some call it Trend Analysis), and is the process of examining current price charts of e.g. a specific cryptocurrency in order to predict which way such cryptocurrency will move next. Term used in a sentence: I used to do my TA and make trading decisions based on that. It never really played out in my favour.
Meaning: Testnet is a blockchain in a testing phase where you are not able to transfer cryptocurrencies to different recipients. This is different from a Mainnet, which is a blockchain in operation where you can make such transfers. Term used in a sentence: The team behind the cryptocurrency has now launched its Testnet and in a few weeks or so, they say they’ll be ready for launch of the Mainnet.
Meaning: Tokenomics is the distribution and creation of certain tokens, and how they are put in place in the relevant token ecosystem. Factors such as: (i) how many tokens that can be mined, (ii) how many tokens that have been pre-mined, and (iii) how many tokens that are allocated through pre-sale and public sale, are important factors in a company’s tokenomics. Term used in a sentence: I thought their technology looked promising but when looking at the tokenomics as presented in their White Paper, I’m not sure if I want to invest.
Meaning: Tokens mean the ‘currency’ of projects built on the Ethereum network that have raised money via issuing their own tokens. There are thousands of tokens in the market. Term used in a sentence: – I never know which token I should invest in and which token I should stay away from. – Nobody does.
Meaning: Trading Fee is the fee you pay when executing an order on a cryptocurrency exchange. This fee is normally a percentage of the order value. Industry average for centralized exchanges is arguably around 0.25% for both “takers” and “makers”. Exchanges sometimes charge “makers” lower fees, thus providing discounts on the trading fees for the makers. This is for the purpose of providing liquidity to the exchange and incentivize makers to tighten the spread in the order book. Term used in a sentence: The industry average of trading fees across the globe is arguably around 0.25%. Interestingly enough, the average trading fees are higher in South America than in the rest of the world.
Meaning: TX stands for Transaction. Term used in a sentence: – This is black eagle, the assassination of your mother-in-law is done. Have you sent me the Bitcoins, John? – Yes, the TX was successfully carried out last night.
We don’t know any cryptocurrency terms starting with “U”. But we hate incompleteness. Please let us know if you know any cryptocurrency term starting with “U”!
We don’t know any cryptocurrency terms starting with “V”. But we hate incompleteness. Please let us know if you know any cryptocurrency term starting with “V”!
Meaning: Wei is the smallest denomination of ether. 1 Ether = 1000000000000000000 Wei (1018) Term used in a sentence: I’m so broke right now. I’m even broker than the guy in the reference example for the glossary term Gwei! Not even a single wei in my crypto wallet.
Meaning: Whale means someone that owns so much cryptocurrency that he/she has the power to alone substantially affect the price of such cryptocurrency (by e.g. issuing a sell order). Term used in a sentence: – My biggest dream in the world is to become a whale. – Well, your weight is almost 600 pounds so you’re not far from it, John.
Meaning: White Paper for cryptocurrencies is essentially the cryptocurrency world’s equivalent of the stock market’s prospectuses. In the White Paper, you will normally have a fairly detailed description of the project, details on the project team members, road map, timeline, details on tokenomics and more. Term used in a sentence: I read the White Paper and it was complete and utter bullshit. I can’t believe that people fell for this. Every person in the project team in the White Paper was made up and there wasn’t even a road map!
Meaning: Withdrawal fees are fees charged by cryptocurrency exchanges when you take out cryptocurrencies (or fiat currencies) from your account at the relevant exchange. Withdrawal fees charged for cryptocurrency withdrawals are normally a fixed fee per withdrawal. There are however certain exchanges that charge a withdrawal fee that is a percentage of the total withdrawn amount. This can add up to quite substantial amounts when you make bigger withdrawals. Term used in a sentence: I traded at an exchange with really small trading fees, so I thought I was safe. But when I wanted to take home my profit, they hit me with their ridiculously excessive withdrawal fees. I thought I was going to start to cry.
We don’t know any cryptocurrency terms starting with “X”. But we hate incompleteness. Please let us know if you know any cryptocurrency term starting with “X”!
Meaning: YABC means “Yet Another Bitcoin Company” and is a term indicating that there is really nothing special with this specific company and that it is just trying to surf the Bitcoin-wave. Term used in a sentence: – What do you think about this new Company X? – LOL. YABC.
Meaning: Zhoutonged is term coming from a man named Zhou Tong, who is the creator of Bitcoinica. Bitcoinica is a margin trading platform that no longer exists. Being Zhoutonged simply means loosing all your money. Term used in a sentence: – Weren’t you buying a house with Bitcoin in St Tropez last year? – You haven’t heard? Yeah I was, but then I got Zhoutonged.
Meaning: 51% Attack is a situation where one single attacker has more than 50% of the total network processing power. In such case, the attacker could perform a double spend, amongst other things. Bitcoin (and most other cryptocurrencies) is designed with the belief that a single attacker will never have more than 50% of the total network processing power. Term used in a sentence: Nobody will ever have more than 50% of the total network processing power when it comes to Bitcoin, so I’m not that worried about a 51% attack.