Cryptocurrencies Terms You Need to Know

As cryptocurrency investors, it’s beneficial to familiarize ourselves with common terminology used within the crypto asset space. Understanding these terms can aid in comprehending information discussed online, both in official news outlets and within online community forums.

Here are some frequently used terms in the crypto assets worlds:

Basic Technology

• Blockchain: A decentralized digital ledger that securely and transparently records all transactions.
• Token: Digital assets representing ownership or specific utilities within a blockchain ecosystem.
• Smart Contract: A self-executing contract with the terms of the agreement directly written into its code.
• Decentralized Finance (DeFi): A financial system built on blockchain technology, aiming to provide financial services without centralized intermediaries.
• Stablecoins: Cryptocurrencies designed to maintain a stable value, typically pegged 1:1 to a stable fiat currency or commodity.
• Altcoins: Any cryptocurrency other than Bitcoin.
• Memecoins: A type of cryptocurrency that often lacks inherent utility and is based on popular internet trends or pop culture, such as memes.
• Fiat: Government-issued currency, such as the US dollar or the Indonesian Rupiah.
• Wallet: An application or hardware device used for storing, sending, and receiving crypto assets.
• Public Key: A wallet address that can be shared to receive cryptocurrency.
• Private Key: A confidential code that grants access to the crypto assets held in a wallet.
• Gas Fee: The fee paid to process transactions on a blockchain network.
• Staking: The process of locking up crypto assets to support the operation of a blockchain network, with rewards provided in return.
• Halving: A 50% reduction in block rewards for crypto asset miners. In the case of Bitcoin, halving is programmed every four years.
• Airdrop: A method of distributing cryptocurrency tokens to users who have completed specific tasks or met certain criteria.
• NFT (Non-Fungible Token): A unique digital asset representing ownership of a specific item or piece of content.

Trading Terms

• HODL: A term derived from the misspelling of “hold,” referring to a strategy of holding crypto assets for the long term, regardless of short-term price fluctuations. HODL later evolved into an acronym for ‘Hold On for Dear Life,’ reflecting the conviction to hold onto one’s crypto assets through market volatility.

• FOMO: An acronym for Fear Of Missing Out, describing the anxiety of missing out on potential market gains, often leading to impulsive investment decisions.
• JOMO: An acronym for Joy Of Missing Out, representing the satisfaction of not participating in market trends and preferring to adhere to a more conservative investment approach.
• FUD: An acronym for Fear, Uncertainty, and Doubt, referring to the intentional or unintentional spreading of negative information to manipulate the market or investor sentiment.
• Whale: A term used to describe large investors who hold substantial amounts of a particular crypto asset.
• Bullish: Market conditions where prices are rising or expected to rise.
• Bearish: Market conditions where prices are falling or expected to fall.
• Rebound: A price movement where a downtrend reverses and transitions into an uptrend.
• Sideways: A price trend characterized by price movement within a relatively narrow range, indicating a lack of a clear upward or downward direction.
• Market Capitalization: The total market value of all outstanding coins or tokens of a cryptocurrency.
• Liquidity: The ease with which a cryptocurrency can be bought or sold without significantly affecting its price.
• Circulating Supply: The total number of coins or tokens of a cryptocurrency that are currently in circulation.
• Total Supply: The maximum number of coins or tokens that will ever exist for a cryptocurrency.
• ATH (All-Time High): The highest price ever reached by a cryptocurrency.
• ATL (All-Time Low): The lowest price ever reached by a cryptocurrency.
• Tokenomics: The economic system of a cryptocurrency, encompassing its distribution, supply, and usage.
• Rug Pull: A type of scam where the developers of a cryptocurrency project suddenly abandon the project and abscond with investors’ funds.
• Phishing: A deceptive attempt to acquire sensitive information, such as private keys or passwords, by impersonating a trustworthy entity in an electronic communication.