51% Attack
In a PoW system, if a concentrated group or entity obtains control of 51% (or more) of a cryptocurrency network’s hash power, they would in theory be able to perform a 51% attack. A 51% attack could allow the group of entity to double spend, replace blocks on the blockchain, prevent other miners & mining pools from being able to earn mining rewards, among other malicious acts.
Address
An address is a unique string of letters and numbers that is used to receive cryptocurrency from another person. Address lengths vary. Bitcoin addresses are usually 26-35 characters (though most Bitcoin addresses are 34). Ethereum addresses are 40 characters (42 including 0x prefix). The private key is used to create the public key; the public key is used to create the address
Airdrop
An Airdrop is a method of distribution for a new Cryptocurrency or token. Airdrops help to increase a projects visibility and circulating supply, and to create early buzz.
Altcoin
Altcoins (alternative coins) are any cryptocurrency other than Bitcoin. Most altcoins possess their own separate blockchain. The first Altcoin was Litecoin, which was forked from Bitcoin in 2011.
Annual Percentage Yield (APY)
Annual percentage yield is the real rate of returns earned on an investment (ROI) on an annual basis, taking into account the effect of compound interest.
Bag
Bags are cryptocurrencies that have plummeted in value from their ATH.
Base58
Base58 encoding is Base64 encoding without the number 0 (zero), O (capital letter O), l (small L), I (large I), and is used to encode many cryptocurrency Addresses (including Bitcoin).
Bear Market
A bear market is a ‘going down’ / declining financial market that is making lower highs and lower lows. The opposite of a bear market is a bull market.
Binance
Binance is a cryptocurrency exchange that was founded in 2017 by developer Changing Zhao (better known as CZ.) Binance allows users to buy, sell, and trade a wide range of cryptocurrencies including Bitcoin, Ethereum, MATIC, Binance Coin (BNB), and many others. Binance quickly became one of the largest cryptocurrency exchanges in the world in terms of trading volume and has since launched other products including Finance Smart Chain and Binance Coin (BNB).
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| A physical projection of the digital currency. |
Bitcoin
Bitcoin (with a capital B) refers to the overall concept of the Bitcoin P2P protocol & Bitcoin payment network. Bitcoin is the first open-source & decentralized cryptocurrency invented by Satoshi Nakamoto. The Bitcoin white paper was published in 2008, and Bitcoin was released in 2009.
bitcoin
bitcoin (with a lowercase b) refers to an amount of Bitcoin. Example: 0.07 bitcoin. Bitcoin also has a Unicode character: ₿, which also refers to an amount of Bitcoin. Example: 0.07 ₿.
Bitcoin Cash
Created in 2017, Bitcoin Cash (BCH) is a Hard Fork of the original Bitcoin. There are both similarities and key differences between BTC and BCH. Both are PoW, both utilize SHA-256, both have a max supply of 21 million, both have the same block times and reward system. The key differences between the two Cryptocurrencies are BTC has a 1MB block size limit, whereas BCH has an 8MB block size limit. The increased block size helps to accelerate the verification process. Additionally, BCH has a dynamic level of difficulty to ensure longevity and verification speed, regardless of the amount of Miners supporting it.
Bitcoin Core
Formerly known as Bitcoin-QT, Bitcoin Core is an open source software client that runs the full Bitcoin blockchain and includes a digital wallet for storing and transacting Bitcoin.
Block
Blocks are the main component of blockchain technology. Blocks contain a summary of validated transactions that were made through a specific cryptocurrency network over a given time period (note — amount of TX per block varies greatly between cryptocurrencies.) Along with a summary of validated transactions, blocks also contain a block header, which includes the necessary metadata to ‘chain’ blocks together. Once a block has been appended to the blockchain, it is improbable to alter.
Block Header
The block header contains the necessary metadata for ‘chaining’ blocks together to form the blockchain. This metadata differs between cryptocurrencies.
Block Header (Bitcoin)
A Bitcoin block header contains: block version, previous block header hash, TX merkle root hash, timestamp, bits (difficulty target) & nonce. Of this metadata, the previous block header hash, nonce & TX merkle root hash are used to form the blocks header hash.
Block Header (Ethereum)
An Ethereum Block Header contains: parent_hash, fee_recipient, state_root, receipts_root, logs_bloom, prev_randao, block_number, gas_limit, gas_used, timestamp, extra_data, base_fee_per_gas, block_hash & transactions.
Blockchain
The key technology behind most cryptocurrencies, blockchain serves as a cryptographically-secure distributed ledger of records on a network. A blockchain in cryptocurrency is comprised of tamper-proof blocks that record all cryptocurrency transactions for a set period of time. Blocks get appended to a blockchain in a specified intervals through a process called mining. In the case of Bitcoin, a new block is mined and appended to the Bitcoin blockchain roughly every 10 minutes. This means that every ~10 minutes, the blockchain grows by 1 block. Blockchain technology as a whole facilitates decentralized P2P transactions without the need for a centralized intermediary.
Bull
A bull is an individual with an optimistic (bullish) outlook towards the price of an asset.
Bull Market
A bull market is a ‘going up’ / inclining financial market that is making higher highs and higher lows. The opposite of a bull market is a bear market.
Coinbase
Coinbase is a cryptocurrency exchange and digital wallet that was founded in 2012 by Brian Armstrong and Fred Ehrsam. The platform allows users to buy, sell, and trade a variety of cryptocurrencies including Bitcoin, Ethereum, Litecoin, Shiba Ina, and many others. Coinbase went public in April 2021, marking a significant milestone for the cryptocurrency industry.
Confirmation
Confirmation means a cryptocurrency transaction has been verified (via the mining process) and added to a block that contains many other transaction. Confirmation (plural) are more blocks containing many more transactions that have been added to the blockchain. Confirmation time varies between cryptocurrencies; Bitcoin has a confirmation time of roughly 10 minutes. This means that every ~10 minutes, your Bitcoin transaction gets buried deeper within the blockchain, thus making it exponentially more difficult to alter. Many exchanges will require multiple confirmations (usually 6 for Bitcoin, which takes about 1 hour) until the transaction is considered secure.
Cryptocurrency
Cryptocurrencies are cryptography-encrypted digital currencies that exist on their own blockchain. A common misnomer with cryptocurrency is it’s an actual computer file that can be sent that stores values. This is not the case. Owning cryptocurrency means you have a special ‘password’ (known as private key) that grants you access to a specific amount of coin allocated to it on the blockchain. The blockchain is owned and maintained by each full node in a massive network. Let’s say Kyle wants to send 2 bitcoins to Chris. Once Kyle’s transaction to Chris is confirmed (via mining), Kyle’s wallet will have 2 less bitcoins, and Chris’s wallet will have 2 more bitcoins (minus the fees). This transaction is permanently recorded to the Bitcoin blockchain, much like the process of writing an entry into a physical ledger book.
Cryptographic Signature
Cyrptographic signatures (also known as digital signatures) verify the integrity of a transaction through public key cryptography. The signing process proves cryptocurrency transactions are made from the right sender and have not been altered. Cyprtographic signatures are generated from the transaction has and private key. The public key is then used to determine if the signature was produced from the proper transaction has and private key.
Dash
Founded by Evan Duffield and Kyle Hagan in 2014, Dash (Digital Cash) describes itself as “the first privacy-centric cyrptographic currency” according to its white paper. The Dash network consists of both regular miners and Masternodes. Masternodes are powerful servers backed by collateral held in Dash, and are designed to provide advanced services and governance on the blockchain.
Decentraland
Founded in 2015 and launched in 2017, Decentraland is an Ethereum-based metaverse that allows users to buy or sell digital real estate, play games and activities, exchange collectibles, interact, and digitally explore with a VR headset. Decentraland uses blockchain technology to facilitate transactions and prove ownership of digital assets. MANA and LAND are the native tokens of Decentraland.
DeFi
Decentralized finance (DeFi) is an umbrella term for any financial service built on public blockchains/cryptocurrency.
Dip
A dip is when a cryptocurrency experiences a decline in price. Dips are visually identified as a ‘valley’ on a price chart.
Distributed Ledger
A distributed ledger is a secured, immutable database that exists across each full node in a large decentralized network. Blockchain is an example of a distributed ledger.
Encryption
Encryption is like putting your message into a secret code that only you and the intended recipient can understand. It scrambles the information using a key, making it unreadable to anyone who doesn’t have the key to unlock it. Encryption in cryptocurrency ensures the security and privacy of transactions and data by encoding sensitive information, preventing unauthorized access and tampering with the blockchain’s integrity.
Ether
Ether (ETH or Ξ) is the main cryptocurrency of Ethereum. It is known as the ‘crypto-fuel’ for the Ethereum network, because along with ether being a cryptocurrency, it is also used to execute smart contracts.
Ethereum
Created in late 2013 by Vitalik Buterin and launched on July 30th of 2015, Ethereum is an open source decentralized platform the focuses on smart contracts and executing the code of DApps. Ethereum runs on its won currency called Ether.
Ethereum Classic
Formed in 2016 as a result of a network hack Ethereum Classic (ETC) is a Hard Fork of Ethereum. Ethereum Classic is simply the legacy chain (pre-fork version) of Ethereum.
Exchange
A cryptocurrency exchange is a platform (website or mobile app) where users can buy, sell, and trade cryptocurrencies using fiat money, bitcoin or alt coins. The exchange facilitates transactions between buyers and sellers and earns revenue through transaction fees and other services.
Fiat Money
Fiat money is government-issued currency declared as legal tender. Examples of Fiat include paper money and coins which have face values exceeding their commodity, and are not redeemable in gold or silver.
Fungibility
Fungibility refers to a good or assets interchangeability with another good or asset of the same kind. Cash is a common type of fungible (interchangeable) asset. A $5 bill is equal to a $5 bill. A €100 banknote is equal to a €100 banknote. 0.5₿ is equal to 0.5₿, and so on.
Genesis Block
The genesis block (also known as ‘block 0’) is the first block of a blockchain. The zero in ‘block 0’ refers to 0 blocks preceding it. The genesis block for Bitcoin contains this message from Satoshi Nakamoto: ‘The Times 03/January/2009 Chancellor on brink of second bailout for banks’.
Hash Function
A hash function is a mathematical process of taking a message (the input) of arbitrary length and turning it into a fixed-length message digest (the output.)
IOTA
Powered by the Tangle (not Blockchain,) IOTA is a Cryptocurrency designed for the Internet of Things. IOTA does not have miners; instead, it relies on each transaction having to approve two previous transactions on the network. Because of relying on transactions to help secure the network, there are no transaction fees. The lack of transaction fees allows the IOTA network to scale through nano-payments between IoT ‘things’. IOTA was released in June of 2016.
Jager
The smallest denomination of Binance Coin (BNB) is called Jager.
JOMO
Joy of missing out (JOMO) is the opposite of having a fear of missing out (FOMO.)
Key Pair
In public key cryptography, a key pair is a pair of private key(s0 and public key(s) that are mathematically linked to each other. Public keys are used to encrypt data, and the private key of the key pair is used to decrypt that data. This is known as asymmetric encryption. Key pairs are used to control access to your cryptocurrency.
Light Node
A light node (also referred to as a thin client) does not store the complete copy of the blockchain like a full node. By only storing the block headers (and not block transactions), light nodes can be run on devices with limited memory resources, such as smartphones. Light nodes are dependent on full nodes to run.
Message
Message is the input of a hash function. Messages can be of arbitrary length; as small as the word ‘dog’ or as large as a poorly-written love story about a high school vampire.
Miners
In a PoW system, miners are an individual’s computer (full node) who earn mining rewards by verifying blocks of transactions to add to the blockchain.
Mining
In PoW system, mining is the process of expending computing power to process and verify cryptocurrency transactions. The mining process effectively adds blocks (which contain the latest transactions) to the blockchain. Miners are incentivized with mining rewards and TX fees.
Mining Pool
Mining pools are groups of miners working together to mine cryptocurrency. Mining pools share ‘pooled’ resources among the pool members to distribute rewards proportionate to the amount of work each member contributed.
Minting
Minting is the process of turning a digital asset into an NFT. Once minted, the NFT is able to be traded or bought with cryptocurrencies on a digital marketplace such as OpenSea & Rarible.
Mooning
Mooning is a rapid price increase in a specific cryptocurrency. Interchangeable with the phrase “To the Moon!’ 🚀 🌖 ✨
NFT
An NFT (Non-Fungible Token) is a unique token that proves ownership for a digital asset on the Blockchain (commonly Ethereal, however other Blockchains support NFT’s such as Tezos, Cardano, Solana and Flow.) You can think of NFT’s as ‘Certificates of Authenticity’ which are backed by Blockchain technology. But unlike Cryptocurrencies, which are interchangeable and worth the same (fungible), NFTs value are unique, therefore non-fungible. The spectrum for digital assets that can be made into NFTs is quite wide! Animated GIFs, digital artwork, audio clips and videos are common types of NFTs. In October of 2020, digital artist Mike Winkelman’s (better known as Beeple) NFT titled ‘Everydays - The First 5000 Days’ was sold at Christie’s for over $69 million dollars (USD). Nice.
OpenSea
Founded in 2018 by Alex Atallah and Devin Finzer, OpenSea is an online decentralized marketplace for buying, selling, and trading NFTs. It is the world’s first and largest marketplace.
Paper Wallet
Paper wallets refer to a physical print-out of your public key(s). This form of cold storage is typically treated like expensive jewelry and stored folded in multiple (as a backup precautionary) waterproof and fire-resistant safes. Funds that are stored on paper wallets can be accessed by sweeping or importing.
Private Key
A private key is the PRIVATE portion of a wallet’s key pair. It is a long string of random characters that proves you have access to cryptocurrency in your wallet. Private keys allow you to spend cryptocurrency from a wallet, therefore they must NEVER be revealed to anybody. This is especially the case for paper wallets, where your private key gets printed on a piece of paper (which can be sneakily photographed by somebody in an attempt to steal your coins.)
Public Key
The public key of a wallet’s key pair is used to create an address to receive cryptocurrency. A public key is created from a private key in a key pair.
Pump & Dump
A pump & dump scheme is when an altcoin garnishes considerable attention from fabricated buzz/hype, which creates a steep price increase in the coin from unsuspecting traders buying in. This is known as the ‘pump’. These ‘pumpers’ already have considerable stock in the coin prior to the pump. The pumpers that create the fabricated buzz then quickly ‘dump’ all their coins at ATH, leading to a substantial plummet in the coin’s price from panic sells. The unsuspecting traders are then left ‘holding the bag.’
Quahl
Quahl, formerly known as Initiative Q, was an attempt to create a new payment network and digital currency. It was created by Israeli entrepreneur Saar Wilf.
Quantum-proof
It is a blockchain that is resistant to attacks coming from quantum computers. Quantum computers are still not fully functional but they've reached a stage where it's believed they can be implemented in the future, which would make current encryption methods like SHA-256 (which Bitcoin relies on) vulnerable against them because of their ability to break through cryptography codes much faster than traditional computing.
Ripple
Ripple is a US-based payment platform company whose goal is to provide a more efficient way to send cross-border payments in the financial industry. Primarily in the banking sector. Ripple is also the name of the network behind the XRP cryptocurrency.
Rugpull
A rugpull refers to a fraudulent scheme where developers or creators of project suddenly abandon it, often after raising funds from investors. This results in a rapid and significant decline in the value of the associated crypto, leaving investors with worthless or nearly worthless tokens.
satoshi
A satoshi is the smallest unit of bitcoin. 1 satoshi = 0.00000001 BTC. satoshis are commonly used in the reconciling of TX fees. The unit is a nod to Satoshi Nakamoto.
Satoshi Nakamoto
Satoshi Nakamoto is believed to be the pseudonym for the programmer (or programmers) who invented Bitcoin.
Soft Fork
A soft fork occurs when the new protocol is backward compatible with the legacy protocol. SegWit is an example of a Bitcoin soft fork.
Software Wallet
Software wallets (commonly referred to as soft wallets) are cryptocurrency wallets that are based in software. Soft wallets come in three forms: desktop wallets, mobile wallets, and web wallets. Soft wallets are a form of hot storage.
Symbol
A symbol (also referred to as ticker symbol) is a unique identifier for a particular cryptocurrency. Examples of symbols include: DOGE – the symbol for Dogecoin, XBT/BTC – the interchangeable symbols for Bitcoin, XLM – the symbol for Stellar, and LTC – the symbol for Litecoin.
Terahash per Second
Terahash per Second (Th/s) is a denomination for 1 trillion h/s. Th/s is a measurement of computing performance for more powerful mining rigs such as ASIC miners.
Turing Complete
Turing complete means capable of computing computational problems so long as enough resources are available.
TVL
TVL (Total Value Locked) is a DeFi metric used to measure the amount of capital (Value) staked (Locked) in a specific protocol.
Utility Token
A utility token is a token that serves a specific use-case within a specific crypto ecosystem.
Vaporware
Vaporware is a conceptual blockchain/cryptocurrency project that is lacking a working concept. Vaporware projects are often marketed to build hype and inflate the value of their ‘project’; yet may never actually come to fruition.
Volatility
Volatility (in finance) is an index for measuring a specific asset’s price movement over time. Cryptocurrency has a reputation of being highly volatile.
Wallet
A wallet is a collection of private keys which allow you to spend your cryptocurrency allocated to it. There are several forms of cryptocurrency wallets that all fall under two categories: hot storage & cold storage.
Web3
Web3 (Web 3.0) refers to the third iteration concept of the Internet. The main idea behind Web3 is decentralization, with heavy reliance on Blockchain technology and users controlling their own data.
Whale
A whale is an individual or group of people who hold an immense amount of cryptocurrency, which could largely manipulate the coin’s value.
XRP
XRP is the cryptocurrency used for facilitating transactions on the Ripple network. It acts as a conversion bridge between the different fiat currencies that are transferred on the Ripple network. Unlike Bitcoin, XRP transactions are processed in just seconds, with much lower fees.
Yield Farming
Yield farming is the process of lending or staking crypto assets to earn rewards and interest/fees paid in cryptocurrency.
YTD
YTD (Year to Date) is a metric that shows the performance of a crypto asset from the beginning of the year to its current price.
Zero-Knowledge Proofs
Zero-knowledge proofs are a way of cryptographically proving the authenticity of an information/transaction without revealing the details of the said information/transaction.
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