New to the Crypto-World or seeking knowledge, Scrolling bitcointalk, arkonix blog or other cryptocurrency related forums on the internet and having no clue about what's going on due to the use of language and terms? Well, here are some of the Cryptocurrencies term you may come across.
General Cryptocurrency Terms
The classification of technology that Ethereum falls into. 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.
A computer that possesses a copy of the blockchain and is working to maintain it.
The process of trying to ‘solve’ the next block. It requires obscene amounts of computer processing power to do effectively, but is rewarded with ether.
A computer especially designed for processing proof-of-work blockchains, like Ethereum. They often consist of multiple high-end graphic processors (GPUs) to maximize their processing power.
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.
Proof-of-work. The current consensus algorithm used by Ethereum.
Proof-of-stake (not piece of shit). 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.
A scaling solution for blockchains. Typically, every node in a blockchain network 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.
Storage for crypto-currency that exists purely as software files on a computer. Software wallets can be generated for free from a variety of sources. MyEtherWallet (MEW) is one of the popular. (more on MEW below)
A device that can securely store crypto-currency. Hardware wallets are often regarded as the most secure way to hold crypto-currency.
Ledger Nano S / Trezor
Two of the most popular hardware wallet models.
Ethereum Specific Terms
Code that is deployed onto the Ethereum blockchain, often directly interacting with how money flows. Not my quote, but: “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.”
Decentralized Application. This refers to an application that uses an Ethereum smart contract as it’s back-end code.
A potential future event wherein Ethereum’s market cap surpasses Bitcoin’s market cap, making Ethereum the most ‘valuable’ crypto-currency.
A measurement of how much processing 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.
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.
MyEtherWallet. A free site that can generate ethereum software wallets for you.
Enterprise Ethereum Alliance. A coalition of startups and corporations trying to figure out the best way to use this dang thing.
One of the primary co-founders of Ethereum (and certainly the most well-known).
Decentralized Autonomous Organization. An investor-directed venture capital fund built on the Ethereum network that was hacked in June 2016. The hack stole about a third of the DAO’s funds and led to Ethereum being hard-forked the following month. The DAO is often cited as one of Ethereum’s biggest stumbles thus far.
Trading Related Terms
Websites where you can buy and sell crypto-currencies. Some popular exchanges in North America are: Coinbase
Government-issued currency, such as the US dollar.
Someone that owns absurd amounts of crypto-currency.
Limit order / limit buy / limit sell
Orders placed by traders to buy or sell a crypto-currency 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.
Sell wall / Buy wall
Using a depth chart, traders can see the current limit buy and sell points. The graphical representation on the depth chart looks like walls. 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.
The act of ‘magnifying’ the intensity of your trades by risking your existing coins. (NOTE: Very risky, only for experienced traders and only on certain exchanges even then)
A margin trade that profits if the price increases.
A margin trade that profits if the price decreases.
An expectation that price is going to increase.
An expectation that price is going to decrease.
All-Time-High. We’ve gotten a lot of these the past couple months.
Generally any crypto-currency other than Bitcoin or Ethereum. (Though some Bitcoin folks would probably still say Ethereum is an altcoin)
Refers to the ‘currency’ of projects built on the ethereum network that have raised money via issuing their own tokens. ?
Initial Coin Offering, somewhat similar to an IPO in the non-crypto world. Startups issue their own token in exchange for ether. This is essentially crowdfunding on the ethereum platform.
Shilling / pumping
Someone essentially advertising another crypto-currency. If a coin is promised to cure cancer or be the second coming of Jesus, it’s being shilled.
A crypto-currency with extremely low volatility that can be used to trade against the overall market.
Taking advantage of a difference in price of the same commodity on two different exchanges. Often mentioned when it comes to comparing ETH prices on Korean exchanges against US exchanges.
Fear Of Missing Out. The overwhelming sensation that you need to get on the train when the price of something starts to skyrocket.
Fear, Uncertainty, and Doubt. Baseless negativity spread intentionally by someone that wants the price of something to drop.
Someone that is spreading FUD.
Pump And Dump
The recurring cycle of an altcoin getting a ton of attention, leading to a fast price increase, and then of course followed by a huge crash.
Someone still holding an altcoin after a pump and dump crash. Can also just refer to someone holding a coin that is sinking in value with few future prospects.
The total value held in a crypto-currency. It is calculated by multiplying the total supply of coins by the current price of an individual unit. This site shows a great run-down of each coin’s market cap.
Return on Investment. The percentage of how much money has been made compared to an initial investment. (i.e., 100% ROI means someone doubled their money).
Trend Analysis or Technical Analysis. Refers to the process of examining current charts in order to predict which way the market will move next.
Moving Average Convergence Divergence. A trend indicator that shows the relationship between two moving averages of prices.
A margin around the price of a crypto that helps indicate when a coin is overbought or oversold.
Long ago, someone on a bitcoin forum got drunk and made a post with this typo in the place of ‘hold’. A meme was born.
What we’re all going to buy when we’re rich. Obligatory
This is gentlemen
“This is it, gentlemen”. Used to point out positive things that are currently happening.
In the crypto-world, this does not mean exposing your buttocks. It is referring to a price going up astronomical levels.
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