Dismissed Bitcoin before….start learning with these basic terms now.
Co-written by Chris Lee

New To Bitcoin and Cryptocurrencies?
Here are terms you will encounter when reading about Bitcoin and you can use it as a guide to learn more in depth about the important components of the entire protocol.
Wallet Related Terms
Private Key — The most important piece of information any user of the bitcoin protocol can possess. It is a secret sequence of letters and numbers that unlocks bitcoins sent to the corresponding address, and is used to create signatures that are required to spend bitcoins by proving ownership of funds used in a transaction. This is not safe to share with untrusted parties. If you don’t hold the private key, your bitcoins are NOT in your possession.
Public Key — Generated from the private key through a one way cryptographic function, which then a bitcoin address is derived from. Safe to share with untrusted parties.
Address — Derived from the public key through the use of one-way cryptographic hashing. This is equivalent to the “name” on the bank account, but in this case, is just a line of letters and numbers. All bitcoin addresses start with the number “1” for reference.
Cold Storage — the private/public keys are generated in a way that is not connected to the Internet and stored offline in paper format (a paper wallet), or a usb memory stick, or a hardware wallet.
Hot Storage — a wallet that is connected to the internet — such as the ones on your smartphone, but where the user is still the only person in possession of the private keys. Popular wallets include Blockchain, and Jaxx. The private keys ARE in your possession and the app’s do NOT possess them.
Custodian Wallet — A hot wallet, and also where the wallet’s private keys are in possession of a custodian, the most well known being Coinbase, and also includes all the wallets held on exchanges.
Multisig (short for multisignature) wallet — a special type of wallet that requires two separately generated pairs of keys to sign off on a transaction. Ie. two different people must agree to a transaction before the transaction can be made.
Ledger Related Terms
Bitcoin Full Node — a computer in the network that has the full and up-to-date ledger aka the blockchain, stored on the hard drive.
Block — a grouping of a number of transactions, prepared to be put on the blockchain
BIP or Bitcoin Improvement Protocol — a code proposal, such as a feature or improvement, that developers introduce and hope to implement onto the bitcoin protocol.
Soft Fork — A change in the protocol that makes only old blocks invalid but even non-updated nodes will recognize the new blocks with the new features implemented. Backwards compatible. Segregated Witness is the most well known soft fork to date.
Hard fork — A permanent change in the protocol and is essentially a new ledger, which makes a whole new or different coin, ie. Bitcoin Cash. Non-updated nodes will not recognize the new blocks that are mined.
Bitcoin Block Explorer — a website used to explore specific transactions within specific blocks
Mining Related Terms
Proof of Work (POW) — A piece of data that requires significant computation to find. In bitcoin, miners must find a numeric solution to the SHA256 algorithm. The difficulty of this getting this data is adjusted so that a block is mined every 10 minutes on the blockchain.
Block Difficulty — The difficulty set to computing the hash so that each new bitcoin block is mined every 10 minutes
Miner — A network node that finds valid proof of work for new blocks, by repeated hash computations. Does not require a full copy of a ledger.
Miner Reward- an amount included in each new block mined as a reward by the network to the miner who found the POW solution. It is currently 25BTC per block
Hash — A fingerprint of some data, after it’s put through the cryptographic function, and more specifically the SHA256 Algorithm in bitcoin.
Hash Rate — The speed at which the computation of the algorithm hash is solved.
51% Attack — Hypothetical attack where a user or a group of users in a single mining pool possess 51% of the hashing computational power in order to prevent legitimate blocks from being added, or helps them make illegitimate blocks to add onto the blockchain.
Mining Equipment Terms
GPU — Graphical Processing Unit, or graphics card, which is instead used to mine because of its processing power
ASIC or Application Specific Integrated Circuit — a computer designed especially for the purpose of mining/hashing the specific algorithm.
Mining Pool — A group of miners who combine their hashing power in hopes of attaining and subsequently splitting the mining reward.
