Invest With Cryptocurrency
(Last Updated On: November 5, 2018)

Cryptocurrency Glossary - 140+ Need-to-Know Words

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Cryptocurrency Glossary – 140+ Need-to-Know Words

 

The world of cryptocurrency is new to many and there are dozens of words that I’ve had to learn in my journey to the moon. Here is a list of every need-to-know term for you to invest with cryptocurrency.

 

#

51% Attack

  • A 51% attack occurs when more than half of the computing power (hash rate) is controlled by a single entity. This entity can be an individual or a united group of individuals and the control over the network can result in different ‘attacks’; such as:
    • Preventing transactions from getting confirmed which can stop all transactions between people outside of the group in control
    • Reversing transactions
      • This allows the attacker to spend coins more than once; “double-spending”
    • Prevent others from mining which creates a mining monopoly for the attacker to reap all mining rewards

Notes:

  • It is very difficult, if not impossible, to change transactions that occurred before the attack.
  • An attack, in itself, would not cripple a coin; however, I would be surprised if people used a coin that has been attacked due to the risk of losing money directly from the attack or as a result of the plummeting value after the attack.
  • It is possible to execute a 51% attack with less than 50% of the computing power but it is much less likely
  • It sounds scary but it is just theoretical at this point due to the amount of resources and know-how to pull it off.
    • There are people who hack fiat currency bank accounts so the threat of this unlikely attack isn’t a reason to not get involved in the world-changing technology that is blockchain.
  • It can be avoided by using a proof of stake coin instead of a proof of work coin

A

Address

  • An address is like your bank account number
    • You can receive, store or send cryptocurrency using your address
    • It is what you give to people for them to give you cryptocurrency
    • People cannot remove your crypto with just your address (also known as your public key)
    • How do you access your online bank account? Probably with a password…this is like your ‘private key’
      • Never give out your private key because anyone with that information can get access to your crypto
    • An address consists of a bunch of numbers and letters

Airdrop

  • A method of distributing cryptocurrency for free
    • This usually only happens early in a coin’s life so many people have an active interest in the success of the coin or token

Altcoin

  • A coin that isn’t Bitcoin or, rather, an alternative to Bitcoin
    • As of late July 2018 there are 1491 coins and tokens listed on coinmarketcap.com.
    • Many of these coins claim to have a unique advantage over other cryptocurrencies; such as, cheaper transaction fees, quicker processing time or the ability to use it as a building block for applications.
    • Examples include Ethereum, Litecoin and Reddcoin

 Arbitrage

  • Buying CoinX low on MarketA and then immediately selling CoinX on MarketB for a higher price.
    • In 2017, in the same moment on two different exchanges, Bitcoin’s price varied by over $1,000
      • This means someone could gain over $1,000 by just trading their Bitcoin to an exchange where it was valued higher which results in a no-risk gain for the trader if they had software with enough sophistication

AML

  • Stands for Anti-Money Laundering
  • This exists to prevent money that came from criminal activity to be put into circulation in aim for criminals to be able to spend the tainted money

Amount

  • The number of Bitcoin in a transaction
  • One of three components of a Bitcoin transaction – see input and output

 

ASIC

  • It stands for ‘Application Specific Integrated Circuit’
  • Essentially, it is something that is meant to do only one task – often related to mining
    • An ASIC might only operate with SHA-256 for Bitcoin’s blockchain or scrypt for Litecoin, for example
    • Because it is focused on one task, it can be much more efficient than many standard desktop or laptop computers
  • New coins are coming out with coding to prevent the use of ASICs

ATH

  • Stands for all-time-high
    • This occurs when a coin or token reaches a point of being more valuable than it has ever been in the past
    • These moments are usually followed by slight drops in value because it is a common time for investors to cash out

 

B

Bagholder

  • An investor becomes a bagholder when they purchase crypto at an all-time-high and the price drops resulting in them ‘holding the bag’ until they sell at a loss or sell when the crypto goes back up in price

Bear market/bearish

  • A description of when the price for a commodity is in a downward trend
    • An easy way to remember this is by noting that a bear attacks with downward swipes of the claws which relates to the downward trend of price

Beartrap

  • A beartrap is set when an investor sells a large portion of a commodity to make it appear like there is a bear market – the prices are plummeting. This causes other investors to sell in panic which results in a further drop in price only to have the ‘trapper’ buy a large portion of the same commodity at a lower price
    • Since the drop in price was not representative of the market demands, the price usually returns back to the original place and sometimes even higher

Bitcoin

  • The first decentralized, open-source, peer-to-peer cryptocurrency
  • It uses blockchain technology for transparency and security
  • Created in 2009 by Satoshi Nakamoto
  • More information can be found in Bitcoin’s whitepaper

Blockchain

  • An accurate record keeping system that offers impressive security and transparency
    • Security comes from being decentralized which requires a hacker to gain control of the majority of a network instead of one central database.
      • Every node in a network has a copy of the ledger
    • Transparency comes from the ability for anyone to view the transactions within the blocks in a blockchain. No names are attached to crypto addresses on the blockchain so there can also be a sense of anonymity.
    • The use of cryptography (passwords for your addresses) allows the network to operate without a central entity
      • This is where ‘crypto’ comes from in cryptocurrency
    • There are many applications for this technology that will impact medical records, marketing tracking, online content ownership and more

Block

  • Every block in a blockchain contains a group of transactions
    • Think of a block as a page in a record-keeping book
    • Blocks cannot be altered after being added to the blockchain

Block Height

  • Block height refers to the number of blocks after the first block (genesis block – block 0) in the blockchain

Block Reward

  • You can receive a block reward by solving mathematical equations (mining)
  • Mining is essentially verifying transactions to be added to a block in a blockchain

Bull market/bullish

  • A description of when the price for a commodity is in an upward trend
    • An easy way to remember this is by noting that a bull attacks with upward swipes of the horns which relates to the upward trend of price

Buy Wall

  • A large buy order placed by an investor with intent to create the urge for people to buy a certain coin which can increase the market price
  • This can be followed by the investor selling all of the coin that was bought at the low price for a profit

 

C

Centralized

  • When a ledger, or record-keeping book, is maintained by a single entity
  • Is commonly used by banks to hold all the account information
  • A hacker only needs to gain control of a central server
  • Antithesis of decentralized

Cold Storage

  • A method of cryptocurrency storage that is offline (not connected to the Internet) in aim to prevent hacking
  • Examples include:
    • Paper wallet
      • Printing out your public key (address) and private key (password) on a piece of paper
    • USB wallet
      • Storing the Keystore file on a USB stick
    • Hardware wallet
      • Storing the information on an encrypted (password protected) USB stick-type device

Confirmation

  • When a node verifies a transaction
  • Some transactions require verification from 30 different nodes to be completed

Consensus

  • Consensus occurs when all participants of a network agree on the validity of a transaction
  • This ensures that the distributed ledgers are exact copies of each other

Cryptocurrency

  • A general term for coins and tokens
    • Also known as digital currency
  • Cryptography is used to secure transactions and control the creation of additional coins/tokens
  • Banks aren’t required for transactions to take place and the nature of the transaction can allow for people to exchange currency directly with another person – even if they don’t trust each other
  • The decentralized nature of cryptocurrency allows it to be theoretically immune to government interference

Cryptography

  • The art of writing or solving codes
  • It can be used to protect data and to validate its authenticity

 

D

DDoS

  • Stands for ‘distributed denial of service’
  • A DDoS attack overwhelms a website by directing a large amount of traffic to the site in aim to crash a website or system

DApp

  • Stands for decentralized application
  • Blockchain-based application that is decentralized
  • An example is the use of smart contracts with Ethereum
    • The smart contract is the application that runs on the Ethereum network
    •  
  • A praised feature of DApps are having proven 100% uptime

Decentralized

  • When a ledger, or record-keeping book, is maintained by having exact copies on several different nodes throughout the network – each node being updated with every transaction
  • Is one of the keystone features of cryptocurrency due to the added security and transparency
  • A hacker needs to gain control of all nodes to infiltrate a decentralized system
  • Antithesis of centralized

Demurrage

  • The process of issuing fees to accounts with unspent coins
    • Only applicable to some coins; not all
  • Fees can increase as time passes

Desktop Wallet

  • Also known as a software wallet
  • Requires the download of software onto your computer
  • Still considered ‘hot storage’ because they are connected to the Internet
  • More secure than web wallets that store your private key on the website’s server

Difficulty (Mining Difficulty)

  • The amount of computing power required to solve the mathematical equations (hash) of a block. This is what increases to counteract increasing amount of mining (network hashrate) in order to maintain Bitcoin’s 10 minute confirmation time and it re-adjusts every 2016 blocks.

Double Spending

  • When a cryptocurrency is used more than once
  • The mining process ensures that each transaction is confirmed to prevent double spending
  • This may occur if a 51% attack is successful

Dump

  • To sell a large amount of cryptocurrency
  • Results in the price going down
  • Part of the ‘pump and dump’ scheme

DYOR

  • Stands for Do Your Own Research
  • Don’t assume that anyone knows the truth when you are investing your hard-earned money
    • Research the topic yourself to come to your own conclusion

 

E

Escrow

  • The involvement of a third party to hold assets during a transaction until a specific task has been completed
  • Could be considered an old-school smart contract

ERC-20

  • The general term used for tokens that are built off the Ethereum platform when creating DApps
  • Most ICOs offer ERC-20 tokens

Ethereum/Ether

  • A decentralized platform for apps that runs on blockchain technology
  • You would pay some in Ether using the Ethereum platform
  • The cryptocurrency with the second largest market cap., after Bitcoin
    1. Some believe that Ethereum will take the top spot from Bitcoin
      • See the ‘flippening’
  • Open-source
  • Can be used to run smart contracts
  • Cofounded in 2013 by several people with the most well-known being Vitalik Buterin
  • There are four phases in the development of Ethereum
    1. Frontier Release (July 2015)
      • This phase involved the setup and testing the of the Ethereum platform in aim to make it safe and stable
    2. Homestead Release (March 2016)
      • Phase two included the development and implementation of projects on the Ethereum platform and the start of general public adoption
    3. Metropolis Release (October 2017)
      • This is the current phase as of January 2018 and includes two parts; Byzantium and Constantinople
        • Implementing features such as Zk-Snarks, revert and returndata, and account abstraction
  1. Serenity Release (TBA)
    • Introduction of the proof-of-stake and the proof-of-work hybrid chain
      • Takes less resources when compared to proof-of-work alone
    • More information can be found in Ethereum’s whitepaper

Exchange

  • A place where you can buy cryptocurrency with fiat currency as well as trade cryptocurrencies
  • Different exchanges are best for certain countries or to acquire certain cryptocurrencies
    • Coinbase is great for people in the USA
    • Coinsquare is my preferred exchange as a Canadian
    • Coinmama is good for credit card purchases of cryptocurrency
    • Bitmex offers advanced trading options
    • Binance and Kucoin are my favourite exchanges for altcoins

 

F

Faucet

  • A situation when cryptocurrency is given away
  • Usually done with coins and tokens when they are first introduced to encourage people to take interest in the coin and begin mining it themselves
  • Click here for an example of an easy Ethereum faucet
    • Just enter your Ethereum address and solve a captcha puzzle!

Fiat

  • Fiat currency is a term to encompass all traditional currency that isn’t digital or cryptocurrency
  • It is usually government regulated and centralized
  • Examples include the USD, Euro and Yen

Flippening, The

  • The anticipated event in which some people believe Ethereum’s market cap. will surpass Bitcoin’s market cap.
  • You can see the progress of Flippening in real-time here

FOMO

  • Stands for Fear Of Missing Out
  • A feeling that one will miss an opportunity to gain profit when the price of something is going up

 

Fork

  • Describes a situation when a change is made to the rules that operates a blockchain
  • This can happen as a result of a 51% attack, correct a bug, or upgrade the blockchain with new features
  • There are hard forks and soft forks

FUD

  • Stands for Fear, Uncertainty, and Doubt
  • Unfounded information that is spread about a coin or token
  • A FUDster would spread misinformation for any number of reasons including:
    • Hope that the price of the currency would go down so it can be bought for a cheaper price or because the currency is being shorted (bet on the price going down)
    • Trolling from people who don’t support the currency

Fundamental Analysis (FA)

  • Reviewing performance attributes and environment factors when considering making an investment
  • As opposed to technical analysis which uses the evaluation of chart trends

 

 

G

Gas

  • The ‘fuel’ to process a transaction on the Ethereum network

Gas Price

  • The amount of Ether required to buy a unit of gas (called Gwei)
  • The person who initiates a transaction pays for the gas and chooses the limit of gas that they are willing to pay for the transaction to be processed
    • Offering to pay more gas will incentivize miners to process the transaction quickly

Genesis Block

  • The first block of processed transactions to be validated to form a new blockchain

GPU

  • Stands for Graphics Processing Unit
  • Used to mine cryptocurrency due to the high amount of processing power
    • Initially designed for computer gaming

Gwei

  • The common name for a unit of gas on the Ethereum network. 1 Ether = 1000000000 Gwei

 

H

Halving

  • Refers to the reduction of reward given to miners
  • Occurs after a designated amount of blocks are mined
    • For Bitcoin, the reward is cut in half after every 210,000 blocks are mined
      • This takes about 4 years
    • This is meant to control the supply level of a cryptocurrency

Hardfork

  • A type of fork (alteration to the code of a coin or token) that is permanent which forces all nodes on the network to adopt the new protocol
    • Bitcoin Cash (BCH) is a result of a hardfork in the Bitcoin blockchain
      • The biggest change was increasing block size capacity from 1MB to 8MB which results in quicker transaction processing time

Hardware Wallet

  • A device to store cryptocurrency offline
  • Very secure due to the private keys being stored on the encrypted device and not being stored on the Internet
  • I personally use the Ledger Nano S hardware wallet because it is easy to use, is compatible with many coins and tokens that I own and added security due to encryption

Hardcap

  • The maximum amount of funds that will be raised by an ICO

Hashing

  • A mathematical process used to prove that a set of data has not been tampered with
  • Part of the mining process to verify transactions

Hashrate

  • The speed of the hashing process

HODL

  • A whiskey-fueled typo for the word ‘hold’ that was made in a Bitcoin forum by a member who was expressing his approach of holding onto Bitcoin during a period of volatility
  • https://bitcointalk.org/index.php?topic=375643.0.
  • Some people have suggested that HODL can be used as an acronym for Hold On for Dear Life

Hot Storage

  • The antithesis of cold storage
  • A storage method where cryptocurrency is stored somewhere that requires an internet connection to access
  • Great for convenience but less safe than the cold storage of a hardware or paper wallet

Hybrid PoS/PoW

A system where consensus can be reached through proof-of-stake and proof-of-work

I

ICO

  • Stands for Initial Coin Offering
  • A way for new companies to raise money by offering coins/tokens in exchange for funds where the people providing funds are hoping that their coins/tokens/shares rise in value

Input

  • The address of the party sending Bitcoin
  • One of three components of a Bitcoin transaction – see amount and output

Internet of Things

  • The network of devices that are connected to the internet

K

KYC

  • Stands for Know Your Customer
  • A regulation that requires a business to verify the identity of its customers

 

L

Leveraging

  • Trading with borrowed money

Limit Order

  • A buy or sell order that has a limit as to how high or low of a price a person is willing to pay

Liquidity

  • The ease to which a cryptocurrency can be bought and sold
    • If you want to sell a coin with low liquidity when it spikes in price, then it may be difficult to find a buyer

 

M

Market Cap/Market Capitalization/MCAP

  • The total value of a coin or token
  • Calculated by multiplying the market price of the cryptocurrency by the total supply in circulation (technically the free float market cap.)
    • A fully diluted market cap. is calculated by using the total supply instead of the total supply in circulation
    • A great website that lists each crypto’s market cap. is https://coinmarketcap.com/

Margin Trading

  • Investing using money that is borrowed using your existing cryptocurrency as collateral
  • A technique used by advanced traders due to the high level of risk involved

Market Order

  • An instant purchase or sale of a cryptocurrency by executing a trade at the current market price instead of setting a price limit

MEW

  • Stands for MyEtherWallet and refers to the site MyEtherWallet.com
  • A free site that can generate free Ethereum paper wallets for you

Mining

  • Mining is essentially verifying transactions within a cryptocurrency network to get a reward
  • A large amount of computing power is required to solve complex mathematical problems which provide a secure way to transfer coins and tokens
  • New coins are created in the mining process and are rewarded to miners
  • Miners compete against each other to be the quickest to find a solution to the mathematical problem

Mining Contract

  • A technique to mine without having the hardware by renting hashing power for a specified amount of time

Mining Difficulty

  • A numeric representation of how difficult it is to mine a new block
  • The lower the number, the more difficult it is to find a solution to the mathematical problem

Mining Pool

  • A group of miners who combine their computing power in aim to solve mathematical problems quicker
  • Allows for more consistent rewards because the group can be the first to find the solution more consistently than any individual member of the pool

Minting

  • The equivalent of mining for a blockchain using proof-of-stake
  • New coins are created (minted) and given as a reward for the minters who verify block transactions
  • Also called staking

Mobile Wallet

  • A wallet that can be used with mobile phones and tablets for payment on the go

Money Laundering

  • The process of ‘cleaning’ money earned through criminal activity by putting it into circulation amongst currency that is not linked to criminal activity

Mooning (to the moon)

  • A term used to describe a coin or token increasing exponentially to ‘astronomical’ levels

Multisignature (multisig)

  • Refers to requiring authorization from more than one person to complete a transaction
  • Similar to writing a cheque/check, you can have a requirement for one or two signatures
  • Commonly used in companies so one person doesn’t have complete access to the company funds

 

N

NFC

  • Stands for Near Field Communication
  • A low-power, short range method of wireless communication
  • Common uses include transferring data between mobile phones and paying with a ‘tap’ feature using your phone

Node

  • A computer that supports a blockchain system by maintaining a copy of the entire blockchain so it can help verify transactions

Nonce

  • A random number that is used only once when a miner attempts to solve the given mathematical problem (hash a transaction block)

 

O

Off Blockchain Transactions

  • Exchanges of cryptocurrency which occur off of the blockchain
  • Typically only between parties that trust each other because the network doesn’t record and validate the transaction like in a typical transaction

Oracles

  • Provides data from various sources to smart contracts

Orphaned Block

  • A block that is successfully created but is discarded by the network after the blockchain has forked. The orphaned block is usually one of two blocks which are simultaneously mined at the moment of a fork

Open Source

  • This means that the code, or instructions, for the software can be used or altered by anyone

Output

  • The address of the party receiving Bitcoin
  • One of three components of a Bitcoin transaction – see input and amount

 

P

P2P/Peer-to-Peer

  • A transaction directly between two parties – without the involvement of a central agency such as a bank or the government
  • One of the biggest benefits of blockchain as it reduces fees and difficulty to move wealth across the world

Paper Wallet

  • A method of storing your public and private key on a piece of paper
  • Prevents the ability for your wallet to be hacked through the internet
  • Susceptible to damage and your information being compromised if someone is able to take a picture of your paper wallet

PoW (Proof of Work)

  • The other main option to validating blockchain transactions besides proof of stake
  • Requires a large amount of computing power to solve a mathematical problem where the solution is a nonce (number used only once) and validates a transaction.
  • It was a concept originally designed to filter spam emails and prevent DDOS attacks

PoS (Proof of Stake)

  • The other main option to validating blockchain transactions besides proof of work
  • Requires the minter (PoS equivalent to miner) to show ownership of a given amount of currency, or stake.
  • Considered the green alternative due the lesser amount of resources required to run the network
  • Ethereum is planning on switching from PoW to PoS
  • The more you own of a coin or token on the proof of stake protocol, the more you can get as a reward for minting

Pre-mining

  • When a cryptocurrency is mined by the developers before it is released to the public
  • The coins can be mined to be given away while promoting the coin, for example, but it is also a common trait of scamcoins

Pre-sale

  • When tokens are sold before the official ICO begins
  • There can be requirements to participate in this early stage of a token sale such as a minimum investment amount

Public Key

  • Similar to how a bank account number is the address for your bank account; your public key is your address to you crypto wallet
    • You can receive, store or send cryptocurrency using your public key
    • It is what you give to people for them to send you cryptocurrency
    • Access cannot be granted to your wallet by providing your pubic key
      • NEVER give anyone your private key
    • An public key consists of a bunch of numbers and letters

Pump

  • To influence the price of a cryptocurrency to go up
    • Done by promoting the crypto to the public or buying a large amount of the cryptocurrency to artificially create a sense of scarcity
  • Part of the ‘pump and dump’ scheme

 

Pump and Dump

  • The act of owning or buying a cryptocurrency at a low price, influencing the price to go up (pumping) and then selling it for a profit (dumping) which usually results in the price returning to the level previous to the scheme taking place
  • Misleading statements or unsubstantiated claims are often used to pump up the coin

Private Key

  • A long series of numbers and letters that provides access to a cryptocurrency wallet
  • How do you access your online bank account? Probably with a password…this is like your private key
    • Never give out your private key because anyone with that information can get access to anything stored in your wallet

Proof of Burn

  • A less-common method to reach consensus and validate transactions
  • Burnt coins are sent to an address that is not authorized to spend

Proof of Existence

  • The ability to anonymously and securely store a proof of existence for any chosen document online.
  • This means that people can prove that a document existed at a certain point in time and demonstrate their ownership of it, without fear of that proof being taken from them.

R

Raiden Network

  • An upgrade that was done to the protocol of Ethereum which enabled high-speed transfers across the network
  • It is being compared to Bitcoin’s Lightning Network
  • It is rumored to be named after the Mortal Kombat character named Raiden

Rekt

  • Slang for when you experience a substantial loss

RSI

  • Stands for Relative Strength Index
  • A trading indicator used to identify overbought and oversold currency

Reverse Indicator

  • Someone who is consistently wrong when predicting the prices of cryptocurrency

ROI

  • Stands for Return on Investment
  • The amount of profit when compared to the initial investment
  • Calculated by dividing your profit by the initial investment
  • Example) Invest $100 and get $50 in profit to get 50% ROI = $50/$100

 

S

Satoshi Nakamoto

  • The alias for the cryptic creator of Bitcoin
  • Some people have speculated as to the real identity of Nakamoto but no one has provided proof on the true identity

Satoshi

  • The smallest sub-unit of a Bitcoin currently available (0.00000001 BTC)

Scamcoin

  • A cryptocurrency (coin) that is created with the sole purpose of getting the developer rich
  • Common traits of scamcoins include being pre-mined or having no unique properties that adds value

Scrypt

  • A type of cryptographic algorithm that is used by Litecoin, Dogecoin and others
  • Compared to SHA256, scrypt is quicker

Seed

  • The private key used in a deterministic wallet

Segregated Witness (SegWit)

  • The process of separating the digital signature data from a transaction any moving it to a second layer which increases the capacity of a block on the blockchain allowing more transactions to be approved with each block
  • Another name for a signature is a witness; hence, is it called segregated witness because the signature (witness) is being segregated from the original data segment

Self-Executing Contract

  • More commonly known as a smart contract
  • A contract that is executed without the need for human intervention
  • Allows for two parties to agree upon conditions, write them into a contract and allow the software to make sure that the conditions of the contract are satisfied

Sell Wall

  • A large sell order placed by an investor with intent to create the urge for people to sell a certain coin which can decrease the market price
  • This can be followed by the investor buying all of the coin that was sold at the high price for a potential profit

SHA-256

  • The proof of work protocol used by Bitcoin and some other cryptocurrencies
  • Requires a large amount of computing power

Sharding

  • The process of blockchain nodes using partial copies (shards) of the entire blockchain
  • This requires less data to be managed and improves the network performance speed

Shitcoin

  • A term used to describe a cryptocurrency with no real value

Shorting

  • Gaining profit from the price of a cryptocurrency going down
  • Occurs by selling when the price is expected to go down with intention to buy again when the price drops

Signature (Digital Signature)

  • The use of your private key to claim ownership over your wallet or data
  • A private key is created in such a way that is basically mathematically impossible to uncover

Silk Road

  • The online marketplace for black-market goods
  • Used to accept Bitcoin as payment
  • Shut down by the FBI in 2013

Smart Contract

  • A contract that is executed without the need for human intervention
  • Allows for two parties to agree upon conditions, write them into a contract and allow the software to make sure that the conditions of the contract are satisfied
  • Also known as a self-executing contract
  • The contract can be executed without any downtime, censorship, fraud or third party interference

Softfork

  • A type of fork (alteration to the code of a coin or token) that occurs without 100% buy-in from all network nodes
  • Nodes that don’t upgrade can still function because newly created blocks are still recognized as valid without the upgrade

Software Wallet

  • Also known as a desktop wallet
  • Requires the download of software onto your computer
  • Still considered ‘hot storage’ because it is connected to the Internet
  • More secure than web wallets that store your private key on the website’s server

Softcap

  • The minimum amount of funds that are required to be raised by an ICO
  • If the softcap is not reached, then the funds are returned to the investor

Solidity

  • Ethereum’s programming language for creating smart contracts
  • Resembles Javascript

Speculator

  • A person who guesses on the price of cryptocurrency and invests accordingly in hopes to make profit

SPV

  • Stands for Simplified Payment Verification
  • The ability to verify a transaction without downloading the entire blockchain

Stale Block

  • A completed, or solved, block which
  • No reward is given for working on a solved block

Swing

  • When the price moves notably up or down
  • Good for day-traders due to the ability to buy low and sell high

 

T

Technical/Trend Analysis (TA)

  • The act of reviewing various indicators on a stock or cryptocurrency’s chart in aim to predict price movement

Taint

  • Used to track a coin’s history by measuring the correlation between two addresses

Testnet

  • A practice area for developers to test out changes to a cryptocurrency without interfering or damaging the live blockchain

Timestamp

  • Proof that a piece of data existed at a certain point in time

Tokens

  • The unit of value created by projects that are built on a blockchain, typically Ethereum
  • Typically are designed to be more than currency
  • Example) ERC-20 token is a general name for any token created on the Ethereum network

TOR

  • Stands for The Onion Router
  • A free web browser that is intended to resist censorship and protect user anonymity
  • Users can surf the web anonymously and access websites on the deepweb

Total Supply

  • Refers to the maximum number of coins or tokens that can be created
  • It contains coins that are in circulation as well as coins that have yet to be mined

Transaction Block

  • A group of transactions that are ‘hashed’ and added to a blockchain

Transaction Fee

  • The amount of money/cryptocurrency paid to miners/minters for validating a transaction
  • If the network is really busy and you must make a transaction without delay then you can voluntarily add more fees to the transaction which will put a higher priority on your transaction compared to other transactions which offer the standard fee

 

V

Vanity Address

  • Like a custom, or vanity, license plate for your car, you can create a cryptocurrency address that contains specific words or numbers
  • Example) 1ETHER2THEMOON3a5gs36ox2VXdeBE7LNd

Velocity of Money

  • A metric used to determine if coins are being spent or held
  • “Bitcoin days destroyed” is the specific metric used for Bitcoin

Venture Capitalist

  • A person, or group of people, that offer money to growing companies in exchange for equity in the company

Virgin Bitcoin

  • A newly mined Bitcoin that hasn’t been spent yet

Volatility

  • The description of the price movement for cryptocurrency
  • High volatility means that the price fluctuates greatly each day
    • Usually considered more risky and is difficult to adopt as a currency for everyday purchases
  • Low volatility means that the price doesn’t change a great deal every day
    • Fiat currencies are considered to have low volatility

 

W

Wallet

  • Like a bank account for your cryptocurrency
  • Contains a public key/address that people can use to send you crypto
  • Contains a private key which is like your password to your ‘bank account’ and, therefore, should never be shared with anyone
  • Can be categorized into hot wallets that require a connection to the internet and cold wallets which don’t require a connection to the internet
  • Types include:
    • Web wallets
    • Software/desktop wallets
    • Hardware wallets
    • Paper wallets

Wei

  • The smallest denomination of ether
  • 1 Ether = 1000000000000000000 Wei (1018)

Whale

  • Someone who possesses a large percentage of a cryptocurrency which can allow them to manipulate the price of the currency for their own benefit

Whitelist

  • A list of registered and approved participants that are given exclusive access to contribute to an ICO or pre-sale

Whitepaper

  • A document that describes a cryptocurrency in detail
  • Usually includes the problem that the currency will solve, a roadmap of important milestones, and technical details

Wire Transfer

  • One traditional way to move larger sums of money across the world
  • Requires the need for an intermediary such as bank
  • Can be slow and expensive to execute

 

Z

Zero Confirmation Transaction

  • A transaction that has yet to be validated by the network
  • Also known as an unconfirmed transaction

Although I have listed and defined over 140 cryptocurrency terms, there are many more less-common terms out there. Here are some terms that didn’t quite make the cut for this glossary:

  • Ashdraked
  • EVM
  • Frictionless
  • DAO
  • Kimoto gravity well
  • Lightning network
  • QR code
  • Quantitative easing

Did one of these terms catch your eye as something you’d like to know more about?

Perhaps I forgot a term all together or you have a better definition of one of the terms listed.

Please comment below with your thoughts and I will be sure to respond! Please include a definition if you suggest a term that you know which should be added.

Always happy to help,

Justin
InvestWithCryptoCurrency.com

Invest With Cryptocurrency; Grow Money

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