USEFUL CRYPTO TERMINOLOGIES YOU NEVER REALLY UNDERSTOOD

It is no doubt that the blockchain space is engraved with lots of ambiguous words that are set to disorganize a newbie if not handled with care. So, to solve this problem, I made a list of 30 most relevant crypto terms that could be useful to newbies. Check it out here

Also, I still get some people coming to the @BAC telegram channel to ask about some other terms they find difficult to understand and so, I have decided to compile a Part 2 of Important crypto terminologies Newbies need to learn and I will try my best to give it a very narrative and simplified explanation. So, Let’s get it started:

Below is a list of a well-described crypto term for your consumption thus:

• TA- TA stands for Technical Analysis. This is simply a mathematical indicator used to predict future price action. The basic idea is that markets behave according to certain patterns and that once established, trends heading in a certain direction often continue along the same course for some time before a switch. However, for good investment analysis, there is a need for both Fundamental and Technical analysis.
• POW- means Proof of Work. It is a consensus mechanism employed by bitcoin, which requires members of a network to expend effort in solving a mathematical puzzle to prevent anybody from gaming the system. Proof of work is widely used for validating transactions and mining new tokens however, it consumes a large amount of energy.
• POS- means Proof of Stake, a consensus mechanism used to validate cryptocurrency transactions. In this protocol, miners are supposed to have ownership of a currency, and the miner with the highest number of currencies (Stakings) would be given a chance for adding/validating the next block to the chains.
• WEAK HAND- This is a person who does not hold a coin for long. He is always eager to sell whenever there is a price dip.
• WHITE PAPER — A white paper is a document that outlines what a cryptocurrency is created to do, the problem it aims to solve, and how it aims to achieve it within a specific period.
• ROARMAP- this is a timely calendar or schedule of events or achievements a project aims to achieve within a stipulated period of time. You can also identify a good project if its roadmap is up to date.
• TOKENOMICS — This is a combination of Token & Economics. It helps understand the supply and demand characteristics of a cryptocurrency. Understanding a project tokenomics will help you know when to enter and exit the project as well as the duration of time you should be in a project either for the long term or the short term. Understanding a project tokenomics is a must if you must be a successful trader or investor.
• ICO — Stands for ‘Initial Coin Offering’, it is mostly used when a new cryptocurrency project gives away some of its coins at a discounted rate usually to finance the project.
• IDO- Stands for ‘Initial DEX Offering’ and it refers to the launching of a cryptocurrency on a decentralized exchange (DEX) usually at a price lower than the listing price in order to raise funds.
• STABLECOIN — This is a cryptocurrency that is tied to the value of the US dollar to make it more stable and less volatile. E.g USDt, Usdc, Busd, Ust, etc. Now, I know the question on your mind concerning the terra USD collapse but that will be a story for another day so, you need to stay glued to this page for that update.
• PUMP AND DUMP- This is more like a scam technique mostly used by whales to rob people of their earnings. Here, they can decide to buy or own a large amount of a coin just to encourage others to buy, and like you know the laws of demand and supply, “the scarcer it becomes, the higher the price”. So, when this happens, they sell off all that they own and the price falls drastically.
• WHEN LAMBO — This is a term or slang often used by investors to inquire when there would be an excessive increase in the price of a particular coin/token they hold.
• NFTs — this simply means Non Fungible Tokens. Do you know that you can easily buy and sell collectibles like art, music, trading cards, fashion item, and even landed properties using smart contracts? Yes . that is achievable using NFTs. you can learn more about NFTs here
• DYOR -Means “Do Your Own Research”. Truth is that the blockchain is very vast and one always needs to do his own research irrespective of where you get your information. The purpose is to reduce the number of uninformed investors in cryptocurrency and encourages them to research and understand a cryptocurrency before investing.
• FUD means Fear, Uncertainty, and Doubt. For instance, Events and news that create a negative effect on the market just like the recently crashed terra luna, news and events have a way of causing negative effects thereby making people sell massively.
• NFA — (Not a Financial Advise) The term is also often used as a disclaimer when cryptocurrency traders and enthusiasts make public posts or share their market analyses on social media platforms. For instance, If you are not a financial advisor and you made a trade analysis and encouraged people to go for it, if the trade eventually goes wrong, you can be sued for it or even arrested. that is why when crypto analysts or trade enthusiasts make such posts, it is always advised to add that disclaimer so that anyone who wishes to follow the analysis, is doing it at his own risk.

This is not to scare you from trading or investing but a reminder that the market cannot be 100% predictable and even a “Correct” analysis can fail so it’s important that users apply discretion while investing.

In conclusion, there are lots of crypto terms, some of which we have treated and others coming up on a daily and one needs to be on the lookout for such terminologies so as not to mistakes or misplace them for another. So, I hope you enjoyed learning these few crypto terms and can rightly place or identify them whenever you come in contact with any of them? I’m sure you do.

Also, don’t hesitate to check out the Part 1 of this article: 30 MOST IMPORTANT WORDS CRYPTOCURRENCY ENTHUSIAST’S AND NEWBIE’S NEED TO FAMILIARIZE

About the Author

Igwe Ihuoma Patience is a self-taught creative and industry-specific content writer, and cryptocurrency enthusiast with 2years plus experience and knowledge of the constantly evolving blockchain space.

I am skilled in content creation, copywriting, curating captions, video editing & graphic designing with mobile phones and I teach others how to get started in the cryptocurrency and blockchain space and My goal is to make blockchain learning and updates easy for anyone to understand.