KYC stands for Know Your Customer, and is a compliance process that was created to prevent money laundering in traditional finance. KYC is conducted by industry participants, such as exchanges, to verify the identities of their customers. It is recognized as both best practice, and more recently, a regulatory requirement. ATL refers to the lowest ever value a crypto asset has experienced since listing on an exchange, i.e. the lowest price point the crypto asset has ever been traded at.
cryptocurrency glossary
If you attempt to receive or hold digital assets in your Cryptocurrencies Hub that are not supported by PayPal, or someone attempts to send such unsupported digital assets to you, they will be permanently lost. PayPal is not responsible or liable to you for any losses or damages which may occur as a result of any attempt to use the Cryptocurrencies Hub with any digital asset we do not support. While these cryptocurrencies may have real-world use cases , one of the biggest uses for them is as a means of speculation. Speculators drive the prices of these coins back and forth, hoping to make a profit from others who are similarly trading in and out of the assets. is an independent, advertising-supported publisher and comparison service.

utility token

Any computer connected to the blockchain network is referred to as a node. A full node is a computer that can fully validate transactions and download the entire data of a specific blockchain. In contrast, a “lightweight” or “light” node does not download all pieces of a blockchain’s data and uses a different validation process. MetaMask, either in its mobile app form on iOS and Android, or in its browser extension form, is a tool to access and interact with blockchains and the decentralized web. Its functions include that of a wallet, a dapp permissions manager, and token swap platform.

Altcoin season is when tokens and coins that are not bitcoins show better performance than bitcoins on a consistent basis. Exchange-traded products are listed securities that track underlying assets, an index or other financial instruments. A network fee is required to ensure your transaction is processed on the Bitcoin or Ethereum network. The fee is used as an incentive to reward network participants, like miners and validators, for processing transactions and helping to secure the network. An order placed on an exchange to buy or sell an asset at a certain price or better. A buy order will be executed at a target price or higher, while a sell will only occur at a chosen or lower price.


White papers are documents that are typically academic in nature, proposing a new technology and outlining the exact details of its implementation. Typically, new projects will launch white papers to help potential users or investors understand the product or service, its use case, and its potential. Technical analysis refers to the process of studying price charts and using various market indicators to determine the state of the market. This is a deep area of study for expert traders, who aim to use technical analysis to their advantage when trying to predict future market movements. The price of an asset multiplied by circulating supply represents the total value of a given asset and its market. Measuring unit of processing power—it tells how many network-specific calculations are done per second by the Bitcoin network. A hash rate of 1 tera hash means the network can perform 1 trillion calculations in one second. A halving occurs after 210,000 blocks have been mined since the last, which corresponds to roughly every 4 years. The Bitcoin network started with a 50 BTC block reward and currently, after 3 halvings, it is at a level of 6.25 BTC per block. A type of social anxiety arising from the notion that others are having fun or enjoying the benefits of an event while the person experiencing FOMO isn’t.
cryptocurrency glossary
Their vision is to build the next social media space called the Metaverse, which allows for a seamless transition between the physical and the digital world. A custodian is a dedicated financial institution that holds its clients’ securities in order to minimize the risk of misappropriation, abuse, theft and/or loss. The term bullish market indicates that one expects the market to develop positively. The term comes from the way bulls attack, with the horns from the downside to the upside. Use our Crypto Glossary to become more familiar with crypto terms. This is not an offer, solicitation of an offer, or advice to buy or sell securities, or to open a brokerage account in any jurisdiction where Brex Treasury LLC is not registered. Consider your company’s investment objectives and relevant risks, charges, and expenses before investing. Review the background of Brex Treasury or its investment professionals on FINRA’s BrokerCheck website. Brex Inc. provides the Brex Mastercard® Corporate Credit Card, which is issued by Emigrant Bank, Member FDIC or Fifth Third Bank, NA., Member FDIC. See the Brex Platform Agreement for details. Fear, uncertainty, and doubt—refers usually to information that is likely to push people toward a pessimistic view of the market.

A network structure meant to optimize the querying of information from across the blockchain by providing an efficient path to its storage source. A value used to generate the master private key and master chain code for an HD wallet. The wallet seed can be represented by mnemonic words, making it easier for humans to copy, back up, and restore private keys. A wallet using the hierarchical deterministic key creation and transfer protocol. They are assumed valid but can be challenged if fraud is suspected. A fraud proof will then run the transaction to see if fraud took place. A change in protocol causing the creation of an alternative chain, or a temporal divergence in two potential block paths during mining. Finality is the guarantee that a set of transactions before a given time will not change and can’t be reverted.

140+ Blockchain and Crypto Words: The Ultimate A-Z Glossary – FinTech Magazine

140+ Blockchain and Crypto Words: The Ultimate A-Z Glossary.

Posted: Tue, 23 Nov 2021 08:00:00 GMT [source]

It is a decentralized digital currency that enables users to make trustless peer-to-peer transactions. As part of the Cryptocurrency Services, we may provide information on the price, range, or volatility of the Supported Cryptocurrencies and events that have affected the price of cryptocurrencies generally. If you are unsure about whether a transaction involving cryptocurrencies is suitable for you and your circumstances, you should contact an independent financial adviser. Mining is the process of creating new crypto coins by solving cryptographic equations. The process involves verifying transactions and adding transaction records to the distributed public ledger, or blockchain. Mining requires powerful computer systems and consumes massive amounts of energy.

Bid Price

An alternative to proof-of-work, proof-of-stake is another type of system used to add blocks to a blockchain. A block is a component of a wider blockchain and contains a series of transactions grouped together during a specific period of time. Blocks contain permanently recorded transaction data and, once deeply embedded in the wider blockchain, cannot be removed. Units of cryptocurrency are created through a process called mining, which involves using computer power to solve complicated mathematical problems that generate coins. Users can also buy the currencies from brokers, then store and spend them using cryptographic wallets. A divergence in a blockchain that occurs when the consensus rules become change. Contrary to a hard fork, a soft fork is backwards compatible; upgraded nodes can validate blocks created by non-upgraded nodes as long as they follow the new consensus rules.
For example, imagine a Byzantine army separated into divisions led by generals camped around an enemy city. Read more about coindesk/calculator here. How can these generals communicate with each other only by messenger to agree on a plan when one or more of them may be “traitors” who will try to confuse the others?. Similarly, how do participants in a decentralized network communicate and coordinate with each other towards some action without relying on a trusted third-party?. A node is a device that participates in a network by following the network protocol. Individual nodes can perform a variety of roles, such as caching data, validating information, or forwarding messages to other nodes.

In the Bitcoin or Ethereum PoW blockchains, the first computer to mine or verify the block receives bitcoin or ether as a reward. This also allows for faster processing speeds since multiple copies are already available rather than one central authority who has to distribute them from scratch if something does go wrong. It should not be confused with distributed computing, though both use similar techniques but ledgers record data while computations perform actions based on said data. Distributed ledger technology is another term used for this concept. An individual or a party that funds a liquidity pool with crypto assets to facilitate trading on a decentralised exchange platform. The cost of sending a cryptocurrency transaction; Fees are collected by miners who validate transactions grouped into blocks. Fees are relative to the specific cryptocurrency, the data size of transaction and the network congestion at the time. As miners earn fees for the blocks they mine they prioritise transactions with higher fees. Mining is the process in which proof of work protocols verify transactions and give miners cryptocurrency in return for their work.

Did Elon Musk invest in Bitcoin?

Tesla CEO Elon Musk has also personally invested in Bitcoin and he has previously used the “diamond hands” meme, which generally indicates that he plans on holding the investment. Musk also said that he believes Tesla will resume taking Bitcoin payment as he sees improvements in the energy mix of Bitcoin mining.

Short for Market Capitalization, this term refers to the total value held in a particular industry, market, company, or asset. For a publicly traded company, the market cap is the total dollar market value of a company’s outstanding shares. For Bitcoin or Ethereum, the total market cap is a reflection of the current existing supply times the market price. The primary network where actual transactions take place on a specific distributed ledger. For example, The Ethereum mainnet is the public blockchain where network validation and transactions take place. Centralized exchanges, operated by companies like Coinbase and Gemini, function as intermediaries, while decentralized exchanges do not have a central authority. A coin, in cryptocurrency, is a representation of digital asset value that is generated via its own independent blockchain.

  • A zero-knowledge proof is a cryptographic method that allows an individual to prove that a statement is true without conveying any additional information.
  • An assessment of the prevailing attitude towards a financial market, such as cryptocurrency, from investors.
  • You should read and understand these documents before applying for any AxiTrader products or services and obtain independent professional advice as necessary.
  • Cryptocurrencies are extremely volatile and can move or jump in price with no apparent reason due to lack of liquidity and ad hoc news.

One thought on “Key terms to understand in cryptocurrency

  1. ieo says:

    Reading your article helped me a lot and I agree with you. But I still have some doubts, can you clarify for me? I’ll keep an eye out for your answers.

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