Lesson

Common Cryptocurrency Terms

Here are some of the basic, non-technical terms you’re likely to come across as you read about cryptocurrencies:

 Address: This is your public key, You share this with others who will send coins or tokens to you. People can have many different addresses and it’s recommended that you generate a unique one for every transaction.

 Altcoin: Short for alternative coin, the term is commonly used to describe any cryptocurrency other than bitcoin.

 Blockchain: A cryptographically protected distributed ledger made up of blocks that contain transaction history. As the blockchain grows longer and longer, it becomes increasingly difficult to alter older transactions.

 Fork: A software fork occurs when there is a change to the original program, which can result in a split of the original blockchain and the creation of a new coin—Bitcoin Cash and Ethereum Classic are two examples of coins created from forks. There can be hard forks, soft forks and believe if or not; accidental forks.

 HODL: Nope, That is not a Typo, Actually yes it is: This comes from a drunken fueled misspelling in a forum posting, the term has become the only acceptable way to say you are “Holding On for Dear Life”

 Initial Coin Offering (ICO): An ICO, also known as a token sale, is a means of crowdfunding where a company offers a new coin in exchange for fiat currency (U.S. dollars for example) or a digital currency (Bitcoin, Ether, Litecoin, etc.) Typically, the funds they received are used to develop the new concept, and the token they issued will be used to transact on their network once it is launched. Both China and South Korea have banned ICOs, and the SEC has stated that they could be considered the offer and sale of securities depending on the circumstances of the offering.

 Smart Contract: An agreement that is written in computer code and automatically executes when certain conditions are met. Some networks, most notably Ethereum, support smart contracts while others do not.

 Wallet: A cryptocurrency wallet stores private and public keys, which are necessary to send and receive coins. There are hardware, software and paper wallets. Hardware and paper wallets are typically considered more secure than software wallets, although there are pros and cons associated with each. If you lose your private key and can’t access your wallet through back-up methods, you will never be able to recover your coins and they are effectively removed from circulation.