Cryptocurrency is still in its early stages and is new to almost all of us, but for the tech-driven and computer savvy people, it is almost a norm. Whenever the word Bitcoin or Cryptocurrency is mentioned, most individuals would be confused and think it is just something that exists on the internet; most people are still unaware of it. A lot are still unaware of the cryptocurrency itself, its uses, and possibilities. Some are already utilising it, and some even make a fortune through cryptocurrency.
Despite that, a lot of people are still turning their heads into cryptocurrency and showing interest in investing in cryptocurrency; a lot of people are also curious about its uses and its possibilities. If you’re interested in investing in cryptocurrency or just curious about the digital decentralised currency, you will be needing some research about this and while doing that you might encounter a lot of unfamiliar words which are connected with the cryptocurrency industry. Before you dig in on cryptocurrency’s characteristics and its volatility, it could be essential for you to know some of the words that you will be encountering if you ever choose to learn about.
The blockchain system is a virtual ledger that is used on every transaction that will be processed on the cryptocurrency network. If you ever buy, sell or even trade your cryptocurrency to another cryptocurrency which is a peer to peer network. The blockchain system is also decentralised, meaning it is not stored on a single device or controlled by anyone, so on every transaction, it would be recorded by validators that spread out all over the world.
In the cryptocurrency industry, Fiat is government-issued money. It can be the physical and some digital money; it is the dollars, pound, yen and the other local money in each country. These are the currencies that are controlled by a government or financial institutions like banks.
Meanwhile, its counterpart is the cryptocurrency, like Bitcoin, Ethereum, Cardano and many other existing cryptocurrencies. These are the virtual monies that aren’t backed by anyone, not even the government. Cryptocurrency can sometimes be called coin or token as well; its worth cannot be directly stated as well as it fluctuates and is still volatile.
An altcoin is a digital currency besides Bitcoin since Bitcoin is also known as the house name for cryptocurrency. All the other existing cryptocurrency is known as altcoin. Some are Ethereum, Tether, Cardano, Binance Coin, and Solana, to name a few.
And exchange is the term used every time you’ll be trading or exchanging your fiat currency into any cryptocurrency or changing back your cryptocurrency to fiat currency. If you’re new to this industry, Crypto exchange is like the brokerage, in which you can deposit the money on a bank transfer using debit or credit card and other deposit options.
Usually, you will be expecting fees for every transaction that you will be making, and there are also other options where you can buy a cryptocurrency which is through phone applications or e-wallets. Several exchanges are out there, which is why it is overwhelming for some. In such a case, going to platforms that can assist you to connect with trusted brokers suited for you is very helpful. To see an example, you can go to the Crypto Engine login page. With a platform like Crypto Engine, aspiring traders can begin trading with ease, while receiving dedicated support from a personal account manager. They do not charge for registration, so you can try it without expense.
DeFi Is just a simplified term for decentralised finance, and It basically means any financial transaction, may it be buying, selling, or trading, that happens without a middleman. The government, national banks or financial institutions of merchants are considered middlemen since with cryptocurrency you can directly send or receive your cryptocurrency to anyone.
It means non-fungible tokens, and it is the word to use for irreplaceable one-of-a-kind digital. These digital items can be anything. It can be digital art, music, videos, articles and even logos. There are new kinds of nonfungible tokens as well through games, tweets, and even virtual land in the metaverse. Just like how some people collect vintage items, famous paintings or even baseball cards, now any digital item can be an NFT collectable, which can also add as a status symbol online.
These digital items have a specific address that is irreplaceable, which means no one can change them, and it has a certain degree of rarity and uniqueness to them. The only possible way you can buy or have an NFT is by using cryptocurrency. You can buy NFT items on an online auction platform, on a secondary market place or even by participating in a mint.
When any of the digital items such as music, art, or videos are recorded to a blockchain system, it is then now filed as minting. If you were participating in the means, that would mean that you would be the first person to buy or have the digital items from its creator. In the process of maintaining the creator or the one that is organising the option will be giving specified royalties that you can receive from future sales. You can either hold the digital item, sell it or even trade it, although if you still sell an NFT on a secondary marketplace, it would most likely get a cut of the sale too.
This is an abbreviation for the phrase ‘hold on for dear life’. Some say it can also be a typo for the word hold. You can usually see this term on social media every time there is a dip in the value of cryptocurrency, and the investors still believe in the future possibility and a value on that certain coin or project.
To Sum it Up
These are just some of the basic terms that you might encounter in your kit to currency investment, and it is most likely essential for you to know what this means besides knowing the basic factors to consider on investing in cryptocurrency. Since cryptocurrency is still in the developing stages, there might still be more cryptocurrency lingo that will exist in the future. Most of these terms came from the cryptocurrency community and are not official for legal uses.