10 cryptocurrency terms you should know for beginners.
If you’re a smart crypto investor, then you should know how to sound like one. Learning the lingo is important in your learning process, so you’re never caught unaware or confused by some basic terms used in the crypto industry. This is a small list of trading terms that you would come across and what they mean, and their use cases.
- Blockchain: This is a decentralized public ledger. We like to see it more like a huge history book that shows all of the transactions and activities carried out in a cryptocurrency’s ecosystem. By decentralized, we mean no one person can control it, and it is almost impossible to hack or change. There are many blockchains, and Bitcoin has one, and so does Ethereum.
- Bid price: This is the price people are willing to sell their crypto assets.
- Satoshi Nakamoto: This is the name of the unknown creator of Bitcoin. Although the creator(s) is very much unknown, the name Satoshi Nakamoto has become something of a legend, with some billionaires like Elon Musk being accused of being the creator.
- Transaction fee: A transaction fee is like the debit alert you get after you transfer money from one account to another. In the crypto space, transaction fees happen with every Bitcoin transaction. These fees are used to pay the miners who process these transactions and are later confirmed by the Bitcoin Network. For Ethereum, it’s called Gas.
- Exchange: An exchange is a marketplace where securities, commodities, derivatives and other financial instruments are traded, according to Investopedia. A crypto exchange is a platform where you can buy and sell crypto. Such as Valor exchange.
- Whale: A whale is a term used for a crypto address that owns large amounts of cryptocurrencies. Bitcoin Whales can have a lot of impact on the market, seeing as they hold large amounts of the currency. There are over 2000 Bitcoin whale addresses out there, but only three own more than 100,000 BTC.
- Mining: This is the process of uncovering new Bitcoin to add to the existing ones in circulation. The process involves miners using powerful computers to solve highly technical mathematical puzzles, which would be added to a new block on the blockchain once solved.
- Address: This is a series of letters, symbols, and numbers that represents a wallet that can send and receive cryptocurrencies. Think of it as a more advanced bank account number.
- Pump: This is the act of purchasing large quantities of a coin to inflate its price on the market.
- Non-fungible Tokens: NFT is short for non-fungible tokens. Non-fungible means it’s one-of-a-kind and can’t be replaced by something else. You can find our comprehensive guide to NFTs and all they entail by clicking here.