So I decided to create a short list of commonly used terms in the crypto and trading world, feel free to add your own in the comments!
Shorting - Shorting, or short-selling, is when an investor borrows shares and immediately sells them, hoping he or she can scoop them up later at a lower price, return them to the lender and pocket the difference. But shorting is much riskier than buying stocks, or what's known as taking a long position
Longing- A long (or long position) is the buying of a security such as a stock, commodity or currency with the expectation that the asset will rise in value. In the context of options, long is the buying of an options contract. ... A long position is the opposite of a short (or short position).
FUD- Fear, uncertainty and doubt (often shortened to FUD) is a disinformation strategy used in sales, marketing, public relations, talk radio, politics, religious organizations, and propaganda.
Hodl- HODL is a slang term and Internet meme that is used in the Bitcoin community when referring to holding the cryptocurrency rather than selling it.
POW- A proof-of-work (PoW) system (or protocol, or function) is an economic measure to deter denial of service attacks and other service abuses such as spam on a network by requiring some work from the service requester, usually meaning processing time by a computer.
POS- Proof of Stake (PoS) concept states that a person can mine or validate block transactions according to how many coins he or she holds. This means that the more Bitcoin or altcoin owned by a miner, the more mining power he or she has. The first cryptocurrency to adopt the PoS method was Peercoin.
Mixing- Mixin as a term used in Monero is different than how the term may be used for Bitcoin or DASH mixing services. In Monero, new transactions "mix" with other previous transactions in the blockchain in the way the protocol itself dictates. In other services, you "mix" your coins with other users' coins to make your transaction more anonymous.
Blockchain- a digital ledger in which transactions made in bitcoin or another cryptocurrency are recorded chronologically and publicly.
51% Attack- A 51% attack is a situation where more than half of the computing power on a network is operated by a single individual or concentrated group, which gives them complete and total control over a network. Things that an entity with 51% of the computing power can do include, but are not limited to:
-Halting all mining.
-Halting and manipulating all interpersonal transactions.
-Use singular coins over and over.
Address- It’s the location from which you would receive, send or hold your currency. These addresses generally manifest in a long string of alphanumeric characters
ASIC- ASIC mining is a crafty method of mining various coins at a much faster rate than any normal desktop or laptop might allow. Essentially what an ASIC, or Application Specific Integrated Circuit is, is a chip specifically created to execute one task.
Block- Blocks are essentially pages in a ledger or record keeping book. Blocks are the files where unalterable data related to the network is permanently stored. Forever. Like eternity.
Block Height- Block height is the number of blocks preceding the genesis block (first block) on the chain. A genesis block will always have a height of zero because nothing precedes it. It’s a metric used to create a bearing on time in the programming world as well as a few other functions such as maintaining counter-party and betting in the crypto world. Considering that a new Bitcoin block is made every 10 minutes, you can work out certain time related pieces of information if you have the total length of the chain.
Block Reward- Block reward is the reward allotted for hashing, or solving the mathematical equation related to a block.
Fork- A fork is the permanent divergence of an alternative operating version of the current blockchain. Forks come into existence when a 51% attack occurs, a bug in the program, or more commonly a new set of consensus rules come into existence. These happen when a development team creates and inserts notably substantial changes into the system. The successful fork is decided by the height of their blocks.
Multisig- Multisig, or multisignature refers to having more than one signature to approve a transaction. This form of security is beneficial for a company receiving money into their BTC wallet. If a company wants to keep it so that one employee doesn’t have sole access to a transaction, multisig allows for a transaction to be verified by two separate employees before it’s complete.
Node- A node is essentially a computer connected to the Bitcoin network. A node supports the network through validation and relaying of transactions while receiving a copy of the full blockchain itself.
Public/Private Key- In cryptography, a public key is a cryptographic key that can be utilized by any party to encrypt a message. Another party can then receive the message and using a key that is only known to that individual or group, decode the message.
Smart Contracts- A two way smart contract is an unalterable agreement stored on the blockchain that has specific logic operations akin to a real world contract. Once signed, it can never be altered. A smart contract can be used to define certain computational benchmarks or barriers that have to be met in turn for money or data to be deposited or even be used to verify things such as land rights.
Mining- Mining is the term used for discovering and solving blocks along the blockchain. A reward is given for solving the algorithm and lengthening the chain, called a mining reward. The mining reward for the Bitcoin blockchain is Bitcoin.
Thanks for reading my article, hopefully it helped you understand a few new key terms!
Happy Trading, Mining or HODLing!
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