GET FAMILIAR WITH CRYPTO TERMS PART 2
Crypto Dictionary
In the crypto (cryptocurrency) world a lot of slang and terms are used. This glossary of terms and abbreviations used in the world of blockchain will help you to understand what the meaning is of commonly used words like FOMO, FUD, HODL, REKT, ERC-20 and many more!
2 Factor Authentication (2FA)
2 Factor Authentication is a double layer security measure. Most crypto exchanges use it. To log in, you not only need to enter a password, but also a code that you receive from the Google authenticator for example.
Account
To log in to a website or computer you need an account. This consists of a username and a password. In the cryptocurrency world, a private key is usually sufficient to log in to the wallet.
Address
An address is comparable to a bank account number. It is a unique collection of numbers and letters. This identification code is required to carry out a blockchain transaction and is unique for each owner.
Airdrop
An airdrop is a way to distribute coins. End users can generally get coins for free or in exchange for a small task, such as subscribing to a newsletter, sending a tweet or inviting other people via a personal affiliate link.
API
API is the acronym for Application Programming Interface. This refers to an interface of applications or websites to easily get data or push data or commands back. This is a widely used system inside and outside the crypto market. For example, Youtube and Telegram have handy API’s, but in the crypto space pretty much each crypto exchange has one for getting price data and even make trades with external programs like Coinigy. Block explorers, like Etherscan.io for example, also have API’s to retrieve transaction, wallet and coin supply details.
Altcoin
An altcoin is any cryptocurrency or token created after the Bitcoin was developed.
ATH
ATH is the abbreviation of ‘All-Time High’ and means the highest price ever paid for a particular coin. ATH is also often used to indicate that someone’s total portfolio has reached the highest value ever.
ATL
ATL stands for ‘all-time-low’ and is the opposite of ATH, or ‘all-time-high’. ATL is used to indicate that the price of a coin or the entire wallet of a person is at the lowest level ever in terms of value.
Bear / Bearish
A ‘bearish’ market means that the complete (crypto) market trend is in a downward spiral. The opposite of ‘bearish’ is called ‘bullish’.
Bag Holder
A bag holder is someone who has a position in a certain coin, which is not worth much more. Often this is accompanied by the hope that this position will be worth something again.
Bear flag
A bear flag is an indication of the price chart that the market is probably going to start a downwards trend. This is the opposite of a ‘bull flag’.
Bear Trap
A bear trap is the opposite of a bull trap. This is when there are false signals on the price chart that a downtrend is coming. This can be a trigger for traders to take a short position. However, the price will rise again and the traders are lured into the trap and lose money with their short positions.
Bounty program
Bounties are simple tasks of jobs by the team behind a coin. These can be as simple as joining a Telegram channel or by (re)tweeting. It could also be a bit more difficult like a translation job for example. The participants receive rewards in the form of coins in exchange for completing these bounties.
Bearwhale
A ‘bear whale’ is someone with a very large position in a coin, but with a ‘bearish’ vision. The bear whale will take every opportunity to sell parts of his position, which prevents the price from rising significantly.
Bull market
A bull market is the condition of financial markets where the prices of securities are rising or expected to rise. This concept can now also be applied to the crypto market. Prices rise and fall every day, but the term bull market is only reserved for longer periods of rising prices. This can go on for months or even years. The opposite of this is called a ‘bear market’.
Bull Trap
A bull trap is a false signal (during a bear market) that the price will go up again. However, after a short rise, the price drops again sharply.
Bull flag
A bull flag is an indication of the price chart that the market is probably going to start an upward trend. This is the opposite of a ‘bear flag’.
Coin
A Coin is the umbrella term for cryptocurrencies and tokens.
Bullish
A bullish market means that the complete (crypto) market is in an upward trend. The opposite of bullish is bearish.
Correction
A correction is a price movement (up or down) after the price has risen or fallen. This is caused by traders that want to cash in their profits. This occurs with both long and short positions.
Confirmation
A new transaction on a blockchain must first get a confirmation before it has been definitively processed. This is done by one of the consensus mechanisms, such as proof-of-work and proof-of-stake. The more confirmations, the greater the chance that the transaction is valid and a double spend is no longer possible.
Crypto
Crypto is the generic term to refer to cryptocurrency, the crypto market and the blockchain industry.
CZ
CZ refers to Changpeng Zhao (赵长鹏 in Chinese). He is the founder of the cryptocurrency exchange Binance, which owns Coinmarketcap, since their acquisition in 2020. Since Binance is a popular exchange the abbreviation CZ is commonly used related to this exchange. For example: ‘CZ should list this coin asap!’
Cryptocurrency
A cryptocurrency, also known as ‘crypto’, is a type of currency that is transferred via a blockchain. It uses strong cryptography to secure the transactions, that usually have value. While traditional fiat currencies are subject to counterfeiting, this is not possible in a cryptocurrency. Bitcoin is still the most valuable cryptocurrency.
Dip
Dip is a rapid decrease in the value of, for example, a cryptocurrency or an entire market. It is less strong than a ‘crash’ and can also quickly recover to the old price level. Also, read this extensive explanation about a ‘dip’.
DYOR
DYOR is a term, which you often see in disclaimers and chat groups regarding the cryptocurrency market. It stands for ‘Do your own research’. It is a quick way of saying that no financial advice is given and you have to do your own research before you invest.
Exchange
An exchange is a place where you can buy and sell different kinds of cryptocurrencies and tokens. These coins can then be deposited back to a wallet, which supports the coin. Sometimes it’s also possible to convert it to dollars.
ERC-20
ERC20 coins are all tokens on the Ethereum blockchain. These coins are also supported by most Ethereum wallets.