In today’s world, the words bitcoin and ethereum are used so much that everybody is now familiar with what they are. Being one of the most famous cryptocurrencies, bitcoins allow us to trade cryptos with the help of trading platforms even though bitcoin transactions are traceable.
However, we must know the technical jargon used in the crypto market to get a sense of familiarity and build our investment. If we don’t know the terms, we won’t have any idea of what’s happening in the market and how we can proceed further.
Moreover, to enter the crypto world, it’s increasingly important that you understand what the technical terms of cryptos mean and what purpose they serve. Cryptocurrency is more than just an investment, it is about how technologies are emerging and changing the way people think and work.
Where technology has revolutionized our entire lives, we should remember that catching up with this growth is not easy. However, with time, we learn from our experiences and keep up with the complexity of cryptocurrencies.
In this article, we will talk about some terms that people should know when they talk about cryptocurrencies. Be it trading, storing, or using the cryptos in blockchain technology, once we know what we are getting ourselves into, we will be better able to make good decisions. Where learning the basics of cryptocurrency surely takes time, investors and experts have not just invested their money but also their time so they have a full grasp and understanding of this field.
Now, let’s have a look at some crypto terms that we should know.
Coins that are not bitcoins can be referred to and can be used as altcoins. Altcoins are anything except the second-most-famous crypto (Ethereum) and also have a very low market value.
Bitcoins are a very famous cryptocurrency. They are the most valuable and were launched in the year 2009 on January 3rd. The value of bitcoin has skyrocketed ever since and fluctuates like crazy too. We know the price of bitcoins went from 60,000 dollars to 30,000 dollars in the previous months.
It is an electronic system, mainly peer-to-peer, formed from an original bitcoin fork. Bitcoins are known to be highly volatile and have great use as a digital currency. Moreover, the design of bitcoin cash helps it to be optimized for transactions.
Blocks are different groups of data in blockchain technology. When we talk about crypto blockchains, blocks comprise transaction records since users sell or buy coins. Furthermore, blocks can hold a specific amount of information. When you see it reaching its limit, new blocks are formed and the chain is continued.
Blockchain is the spectacular technology behind cryptos. It is just like record-keeping but digitally. When sequential blocks build upon each other and create an unchangeable and permanent ledger of transactions, blockchain is formed.
The coin represents the digital value, living on a cryptocurrency network or a blockchain. Some blockchains don’t have different names for both the coin (such as bitcoins) and the network. Other blockchains have different names such as the Stellar blockchain – it is a native coin known as Lumen.
It is a centralized, increasingly famous cryptocurrency exchange. It made a record as the first crypto exchange going popular on the Nasdaq.
It is a method you can use to store your cryptocurrency offline. Cold wallets are also known as hardware wallets. They are physical devices and have a similar look to a USB. Such wallets help you protect your cryptocurrency from theft and hacking. Although it has its risks, for example, you can lose your wallet and your crypto.
The smart contract is an algorithm program. It validates the contract terms automatically depending on its code. Also, an important value proposition of the ETH network (Ethereum) is its capability of executing smart contracts.
A stable coin fixes its value to other commodities or non-digital currency. A digital fiat is the representation of a government-backed currency and represents a fiat, on the blockchain. Take Tether, for example, it is fixed to the ever-known U.S. dollar.
Whenever you make transactions on a blockchain, there is a specific fee for you to pay. This fee is known as a gas price. What happens is that a miner goes out and receives cryptocurrency for you.