101: Cryptocurrency Terminology
Published in
4 min readFeb 7, 2018
- 51% Attack: 51% attack refers to an attack on a blockchain. Generally in relation to cryptocurrencies. When miners control more than 50% of the networks mining power (hashrate). The attackers (miners) can prevent new transactions from being confirmed, halting payment between users.
- Altcoin: Short for alternative coin. Any crypto-currency other than Bitcoin or Ethereum.
- Arbitrage: When you buy and sell an asset at the same time to make a profit from the price difference. Buy low, sell high — simultaneously.
- ATH: All Time High.
- Bag Holder: Someone who is holding on to a cryptocurrency that has decreased in value so much it is considered worthless.
- Bearish/ Bear Market: A Bear Market is a condition where prices fall and widespread scepticism causes the market to be a self sustaining downward spiral.
- Bullish/ Bull Market: A Bull Market is a condition where prices are increasing or expected to rise.
- Escrow: Holding funds or assets in custody (a third party) on behalf of two other parties that are in the process of completing a transaction. Only when the contractual obligations have been fulfilled, the funds are asset will be released.
- Exchange: Websites where you can buy and sell crypto-currencies.
- FOMO: Fear Of Missing Out. The overwhelming sensation that you need to get on the train when the price of something starts to skyrocket.
- FUD: Fear, Uncertainty, and Doubt. Baseless negativity spread intentionally by someone that wants the price of something to drop.
- Going long: A margin trade that profits if the price increases.
- Going short: A margin trade that profits if the price decreases.
- HODL: HOLDING onto your Bitcoin (or other altcoins) through the bad times. Made famous by GameKyuubi as pictured below.
- ICO: Initial Coin Offering, somewhat similar to an IPO except you are buying tokens and not shares in the company. An ICO is an opportunity for investors to buy in relatively cheap with the hopes that it will increase in value once the project has reached some measure of success.
- Limit order / buy order / sell order: A limit order is an order placed on an exchange to buy or sell a cryptocurrency at a specific price. A buy order will only be executed at the limit price (or lower) and a sell order will only be executed at the limit price (or higher)
- Market cap: The total value held in a crypto-currency. It is calculated by multiplying the total supply of coins by the current price of an individual unit.
- Market order: A Market order is a buy or sell order to be executed immediate at the current market price. A market order is the simplest of order type.
- Pump and Dump: People who artificially increase the price of a coin by promoting it at the same time they’ve bought a significant amount of coins relatively cheap (the pump). As trading volume increase and the coin value rises the Pumper then becomes the Dumper and they sell all their coins to gain a profit and people begin panic selling, sending the price plummeting.
- Shitcoin: A shitcoin is any new altcoin that is not mainstream or does not add innovation to the market. If an altcoin grows worthless or turns out to be a scam, then it is a shitcoin.
- Shorting: Selling a cryptocurrency in hopes of buying it at a lower price at a later time to gain profit.
- Stable coin: A crypto-currency with extremely low volatility that can be used to trade against the overall market.
- To the Moon: Extreme bullish movement of a coin.
- Tokens: Tokens are a representation of a particular asset or utility, that usually resides on top of another blockchain. Tokens can represent any assets that are fungible and tradeable.
- Volatility: Volatility refers to the amount of uncertainty or risk about the size of changes in a security’s value.
- Whale: An investor who has a substantial amount of capital to invest into altcoins. Whales are often the market movers for small alt-coins too due to their huge capital.
- Whitepaper: A white paper is an authoritative report or guide that informs readers concisely about a complex issue and presents the issuing body’s philosophy on the matter. It is meant to help readers understand an issue, solve a problem, or make a decision.
