“Glossary of Crypto-Currency”
Here is a constantly updated collection of definitions for the the most important and unique Crypto-Currency related words, terms and phrases provided for your ease of access, to help the community grow & thrive.
“2fa” for short. This is a second form of authenticating a user upon entry to an account or service. This is usually done in the form of a code sent to email, phone or to an application. The most secure versions of this technology use a randomized QR code that generates a specific code based on the exact time. The service and user are then both able to calculate the same code automatically each and every time. Each code expires and a new one is generated very rapidly. This protects hackers from gaining access to your account.
“Alternate Coin” or Altcoin is a term used for describing any coin which is not Bitcoin. Prominent Bitcoin users will refer to any other coin as an altcoin, and sometimes a scamcoin.
A Bitcoin address is similar to a physical address or an email. It is the only information you need to provide for someone to pay you with Bitcoin. An important difference, however, is that each address should only be used for a single transaction.
Bit is a common unit used to designate a sub-unit of a bitcoin – 1,000,000 bits is equal to 1 bitcoin (BTC or B⃦). This unit is usually more convenient for pricing tips, goods and services.
Bitcoin – with capitalization, is used when describing the concept of Bitcoin, or the entire network itself. e.g. “I was learning about the Bitcoin protocol today.”
bitcoin – without capitalization, is used to describe bitcoins as a unit of account. e.g. “I sent ten bitcoins today.”; it is also often abbreviated BTC or XBT.
A block is a record in the block chain that contains and confirms many waiting transactions. Roughly every 10 minutes, on average, a new block including transactions is appended to the block chain through mining.
The block chain is a public record of Bitcoin transactions in chronological order. The block chain is shared between all Bitcoin users. It is used to verify the permanence of Bitcoin transactions and to prevent double spending.
BTC is a common unit used to designate one bitcoin (B⃦ or Ƀ).
A bear market is a financial market in which prices are falling or are expected to fall over time.
A bull market is a financial market in which prices are rising or are expected to rise over time.
Refers to a “place” where data or services are stored and used but are not physically accessible. Hence, “stored in the cloud”.
This term is reserved for services which allow users to pay for mining “hash rate” and reap the benefits of mining, but not physically own any hardware or have to worry about the power costs. The service usually offers a contracted agreements based on speed and length of contract time. There are many illegitimate “cloud mining” operations, which are known as Ponzi Schemes. Be careful investing!
Confirmation means that a transaction has been processed by the network and is highly unlikely to be reversed. Transactions receive a confirmation when they are included in a block and for each subsequent block. Even a single confirmation can be considered secure for low value transactions, although for larger amounts like 1000 US$, it makes sense to wait for 6 confirmations or more. Each confirmation exponentially decreases the risk of a reversed transaction.
This is a broad term describing any “Coin” which runs on a Blockchain. It is based off the word Cryptography. Bitcoin is the first ledger system to systematically incorporate such deep encryption. The Blockchain has never been successfully hacked.
The act of taking the power from an institution and giving it back to the people.
If a bitcoin transaction is not confirmed yet, the user who sent the transaction may be able to send the coins again with a higher fee somewhere else, and that transaction will go through first — nullifying the first transaction. This is called a double spend. There are many strategies to double spending, but the best way to eliminate them is to make sure you always wait for 6+ confirmations before ever delivering a product or service.
Ethereum is one of the most notable altcoins to date, hosting new features that Bitcoin will never implement. The innovation being Ethereum is to allow developers to program smart contracts and apps directly into the Blockchain. This gives business another whole aspect to thrive in.
Ethereum experienced what is known as a “hard fork” early in its existence. The original fork still exists and is called “ETC” or “Ethereum Classic”
A service which people use to trade fiat currency for crypto-currency.
A time in which the blockchain undergoes an abrupt change. Any type of fork is to bring about abrupt change within the network. It can be used to patch bugs or change the way the network runs.
This term is used as a unit of measurement to determine how fast a miner is mining.
Every time Bitcoins are deposited onto an address, 1 input is created. When going to send Bitcoins, the amount of inputs determines the size of the transfer. The size of the transfer determines the fee. Lower inputs = less fees.
Kilowatt-hour is a term used to describe power usage. ~1000w for 1 hour = 1kWH or 1 Kilowatt-Hour.
A very prominent Altcoin which has been around since 2011.
Using computational processing power to decrypt data stored within an unconfirmed block on the blockchain in an effort to confirm that block.
Peer2Peer is a term used to describe anything that is sent directly from one person to another, without the need for a middleman. Bitcoin is p2p money.
When a company or services uses new investor money to pay other, older investors. The service eventually is unable to pay investors and dies.
A pool is a network of miners who work together to solve a block, all rewards are dispersed evenly according to who supplied the most “hash rate”.
A private key is the password that is created at the time an address is created. This long, encrypted key is the only way to access coins stored on a wallet.
A program or service which holds the user’s public/private keys and interacts with the Bitcoin Network.
Zcash is a prominent alcoin that is gaining a following fast. It was created in October, 2016 and has a limit of 21 mil coins, similar to Bitcoin.