Nothing Complicated! 19 "CRYPTO" WORDS BEGINNERS NEED TO KNOW (PART 1)

 

"Crypto" Do not just look for money, before entering the world of crypto, you must first understand it. Here are 19 cryptographic terms you need to know. Are you interested in moving into the world of cryptocurrencies? Of course, you first need to understand how it works, as well as some commonly used cryptographic terms. Otherwise, you will become more and more alien and it will be more difficult for you to adapt to this world. Well, this time we take a closer look at the most commonly used terms in crypto. From what cryptocurrency itself is to slang terms like bag carrier and more. Come and see!

Cryptocurrency Simply put

cryptocurrency can be called a virtual currency because it does not exist physically in the real world, but exists digitally and has value and can be used as a means of transaction like fiat currency. Cryptocurrency investments are protected by encryption, which reduces the likelihood of counterfeiting or copying. Before Satoshi Nakamoto introduced Bitcoin in 2009, the cryptocurrency pioneer had been around since 1998. 

At the time, Wei Dai was working on an anonymous electronic money distribution system called B-money. After the birth of Bitcoin, many other coins started to appear and eventually this cryptocurrency trend became more and more popular. Cryptocurrencies can be traded directly from one person to another. This currency works with the same exchange rate in all countries, so exchange rates should not affect transactions. With the exception of exchange rates, cryptocurrencies built on Blockchain technology do not involve third parties such as banks in transactions. 

So the value of the transaction is not affected by anything other than other users. In addition to being used as a transaction tool, cryptocurrency is also often used as an investment tool. This is because the value fluctuates, so they hope that the price of the cryptocurrency they hold will increase in the future.

Altcoins

As we know there are many currencies in the real world ranging from Rupees, US Dollars, Singapore Dollars, Dinars, Pesos etc. The diversity of these coins can also be found in cryptocurrencies, currently there are more than 10,000 cryptocurrencies circulating in the digital market, one of which is altcoin.

So Bitcoin is not the only cryptocurrency. Altcoin refers to all cryptocurrencies except bitcoin. As Business Insider says, altcoins are an alternative cryptocurrency to bitcoin. As the name suggests, altcoin comes from the word option and coin, which means alternative currency. In this context, it is an alternative to bitcoin. The first cryptocurrency developed in the world is Bitcoin. This makes cryptocurrencies other than bitcoins called alternative currencies or altcoins. 

Altcoins have been developing since 2011 and the first generation uses the same blockchain as bitcoin. The altcoin that appeared for the first time was called namecoin in April 2011, where development work was done by adapting the bit code. The presence of Namecoin became a historic moment and paved the way. Because by the looks of it, the crypto market has room for more than one coin. And since it comes from bitcoin, its price often follows bitcoin's price movement. However, as the cryptocurrency investment ecosystem matures, altcoin price movements become independent.

Blockchain

Many people learn about blockchain through cryptocurrency, they start learning blockchain because they are interested in the technology used to build cryptocurrency. So that not only the IT community, but also layers of society outside the technological world get to know what blockchain is. However, such uses of blockchain are not limited to cryptocurrencies. In 2018, McKinsey compiled a table of blockchain opportunities in various non-financial sectors, from medicine to agriculture to real estate to media. 

Blockchain itself is a technology used as an encrypted digital storage system or database. Therefore, the financial sector, such as cryptocurrencies, is very suitable for the use of this technology, because the blockchain becomes a kind of digital ledger that can be accessed by anyone. The use of blockchain makes transactions more transparent and minimizes misuse of data such as bribery and corruption. Literally, the word blockchain consists of two syllables, namely block and chain. Block means group and chain means chain. The name simply reflects how the technology works, where blockchain uses computer resources to create blocks that are linked together to form a chain. These linked blocks ultimately complete transactions. 

Interestingly, this technology can work without a special system to regulate it, relying only on computer algorithms, so the blockchain is decentralized, that is, not centralized.

In Satoshi

Satoshi is synonymous with names of people, but if the context is a cryptographic term, then Satoshi is the name of the smallest unit of Bitcoin. The name Satoshi was given to this smallest unit directly by Satoshi Nakamoto, the creator of Bitcoin. 1 Bitcoin is equal to 100,000,000 Satoshis, so the ratio of Satoshis to Bitcoins is one millionth (1:100,000,000) or 0.00000001 BTC. Satoshi units are quite important because calling bitcoins smaller makes transactions easier to read. 

An example of how this is used is that everyone was given the name Satoshi before the blockchain was shown. Additionally, the source code uses Satoshi units to determine the amount of bitcoins. Then when calculating the price of bytes, which requires showing a fraction of a bitcoin, Satoshi is also used.

Bag rack

Bag Holder is a slang term that refers to an investor who holds onto a stock whose price is falling and is unlikely to recover anytime soon. For example, you buy a stock at $10 and then the price drops to $2, which other traders might call a bag handle. But don't misuse the term. If someone buys stocks or cryptocurrencies with strong fundamentals and then the price of those stocks falls due to certain circumstances, it would be wrong to call them bag holders. This is because stocks with strong fundamentals, especially blue-chip stocks, still have a chance to recover to reach new highs in the future. "chriptho”

FUD

The term FUD is used quite often in the world of crypto investment. FUD stands for Fear, Uncertainty and Doubt, which is the behavior or strategy of an investor to spread fear and doubt about an investment instrument to other investors to release the instrument and buy it at a low price. . This practice is very common in the world of crypto trading or elsewhere in the world. Experienced traders usually smell a FUD record and ignore it, holding their assets until the price stabilizes. Therefore, to avoid FUD, as a trader you should always update news and references from several reliable sources.

HODL

HODL is a slang term in the cryptocurrency community that describes the attitude of staying invested and not withdrawing when the price drops. HODL itself stands for Hold On for Dear Life. The term HODL used in the community seems to refer to firmly holding a cryptocurrency and not being bothered by it, no matter how high the price is. In fact, the origin of the term HODL is quite unique, namely due to a typo by a bitcoin user with an account called "GameKyuubi". During the legendary bitcoin price crash in December 2013, he misspelled the word "HOLD" with a D before the L, making it "HODL."

 At the time, he criticized other traders who decided to sell their coins when the price fell. His policy is not to sell his coins even if the price goes down. He angrily said: "If you sell now, the merchant will take your coins! and then said: "I like it", but "I'm TEN!"

FOMO

FOMO means "fear of missing out." FOMO usually refers to feelings of anxiety or discomfort when other people share positive or unique experiences. When you experience FOMO, you tend to panic and you don't want to be late to experience the same. In the investment world, FOMO refers to the fear that traders or investors will miss out on a potentially profitable investment or business opportunity. This phenomenon is quite common in the world of trading and investing, including cryptocurrencies. 

This FOMO is quite dangerous, because if you see a market that swings sharply up or down, you must trade immediately because you do not want to lose the opportunity. In fact, every moment that happens in the market is unique and anything can happen at any time. Because of FOMO, trading and investing is not recommended because it makes you make decisions based on emotions rather than the results of careful analysis.

Low and rising

A bear is a cryptographic term used to describe a situation where the market is in a continuous downward trend in prices over a period of time. While Bullish is the opposite, which is a term that describes a condition where the trend of the market price is increasing or strengthening over a period of time. The term is taken from the behavior of the two animals used in its name, namely a bear and a bull. A bear or bears will fight their opponent by charging down, so it is used to represent falling prices. At the same time, the bulls attack even more, therefore it is suitable to represent an upward trend.

Pump and exhaust

Pump and dump in the cryptocurrency world is a term that refers to market manipulation schemes carried out by interested individuals or groups. This cycle can happen very quickly, even in seconds. The term "pumping" is defined as the purchase of an asset in large quantities to increase demand and therefore the price of that asset. When the price of an asset rises, the person or group of people implementing this system will sell their crypto assets until the price falls, ie. to the landfill. 

Fraudsters take advantage of market supply and demand dynamics to prevent investors from feeling strange and seeing price movements as normal trends. Fraudsters often target new, unpopular coins or tokens to avoid using the assets to manipulate the market. Fraudsters tend to avoid schemes that involve large funds like Bitcoin. Scammers also often target Initial Coin Offering (ICO) Moments and exploit them to promote their pump and dump schemes.

scalping

Scalping is a crypto trading term that refers to trading strategies that maximize profit from small price changes. In this case, scalping is done by quickly and repeatedly opening and closing positions. Scalpers practicing this strategy must be fully focused because they must pay attention to even the smallest movement on the chart. In addition, their reactions must be quick to open a position when the trade moves in their favor and to close the position when the trade moves in the opposite direction. Scalping gives results quickly, but note that traders can make the right decisions in a short period of time. Therefore, this technique really requires eye and hand speed.

Bet

The term crypto trading refers to one of the popular strategies used in the crypto trading market to generate passive income. This method must be done using a wallet that has a staking service to hold crypto assets. Funds stored in the wallet are locked in the blockchain with a consensus proof algorithm for a certain period of time. The amount of profit obtained depends on the price and amount of the crypto asset to be locked and the duration of the asset to be locked. People who invest their crypto assets in the PoS blockchain are called validators. If the validator successfully validates the transaction, they only get paid. Each store usually applies different special rules to their validator.  

That's right

A correction is a crypto term that means a condition where the price of a cryptocurrency falls immediately after reaching a peak. Although on the downside, improvements don't always feel negative. In the crypto market, these corrections are normal because prices are always affected by supply and demand. Usually, a correction indicates that the price and asset are overvalued, so the price tries to return to its market value.

Application    

Dapp or decentralized applications are applications that facilitate user interaction with the blockchain. The nature of this program is peer-to-peer, which means there are no intermediaries or third parties, so users and other users can trade directly on a peer-to-peer (P2P) network. 

Because Dapp uses blockchain, it has clear characteristics of transparency, independence and data ownership. The application layer is connected directly to the user, where the blockchain is called the protocol layer. The success and development of dapps affects the development and success of blockchain technology in general.

DeFi 

DeFi, which stands for Decentralized Finance, is a cryptographic term that refers to an ecosystem of blockchain-based financial applications. This application can work without intermediaries or central institutions such as banks and other financial institutions. Currently, almost all financial services are still managed centrally, including savings, credit, insurance and stock markets. 

So we must have a bank account or an account with access to financial institutions to take advantage of various financial products and services. The existence of DeFi makes all transaction processes transparent and open source, written in smart contracts. All users can self-verify the app code so users can have full control over their money.

TEN

DEX stands for Decentralized Exchange, which literally means Decentralized Exchange of Crypto Assets. Dex is a crypto asset marketplace that can be used to buy and sell crypto assets without the help of a third party. Trading in this system is peer-to-peer, where users trade directly with other users. Every user is free to make deposits and exchange goods for trading on the DEX platform. All funds can be withdrawn at any time and converted back to the crypto of the user's choice.

The whale

Valas literally means whale, but the crypto term Whale is a nickname for investors who hold large amounts of crypto assets, and their every move creates confusion in the market and affects the price of crypto assets. That is why they are called whales, because these large sea animals can create waves in the sea just by waving their tails.

Software sheep

Crypto assets can be stored in the program in the form of digital wallets or wallet software. This wallet is like a bank account that is used to store crypto assets and also allows the owner of the asset to make transactions. There are three types of software wallets, namely desktop wallets that use a computer, mobile wallets that use smart apps, and online wallets. In terms of security, this software wallet is almost guaranteed, as it uses a username and password that the user can set.

NFTs

NFTs are irrevocable tokens that are digital assets that represent assets on top of the Ethereum blockchain through smart contracts. This can be art, trading cards, in-game items, and even something in the real world like property. Unlike cryptocurrencies, which are assets with an exchange rate, NFTs are assets that do not have the same exchange rate. At the same time, NFTs have different values ​​depending on the asset. Each NFT content has a digital signature of ownership and cannot be exchanged for another NFT because the value is not the same. NFT assets can be traded on several dedicated NFT markets such as Opensea, Rarible, Superrare and others. Buying and selling NFTs requires registering with the market and having a wallet supported by the market, of course in addition to the NFT asset to sell and the cryptocurrency to buy. "Crypto"