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A comprehensive list of terms and abbreviations frequently used in the cryptocurrency market

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Terms and abbreviations used in the cryptocurrency market.

The crypto space is a vast and fast growing market. The market value of cryptocurrencies is often driven by news, big announcements, partnership and sponsorship deals. To stay updated with the latest news in the crypto space, the use of social media platforms such as Twitter, Medium, Reddit, Github, Bitcointalk and Telegram as a quick means of dissemination of information, is highly needed.

While making use of these social media platforms, people frequently abbreviate blockchain/crypto terminologies. However, crypto newbies or beginners who are just getting acquainted with the crypto space might not be familiar with most of these abbreviations used. As such, these are the popular abbreviations frequently used in the crypto space. Abbreviations in crypto space can be further subdivided into three:

List of Blockchain Terminologies

51% Attack: is a planned attack on blockchain by a group of miners controlling more than 50% of the network hash rate.

ASIC: Application Specific Integrated Circuit. ASICs are silicon chips specifically designed to perform a single task. In the case of bitcoin, they are designed to process SHA-256 hashing problems to mine new bitcoins.

ASIC Resistant: is a term used to describe cryptocurrency proof-of-work protocols that are resistant to Application-Specific Integrated Circuit (ASIC), by packing in various parameters that make it difficult for ASICs to have a competitive edge against consumer hardwares.

BEP-20: is a token standard that is on the Binance Smart Chain. It is similar to ERC- tokens that are issued and implemented on the Ethereum blockchain.

Block rewards: are rewards designated for miners, for their success in completing mining a block.

BUIDL: is a derivative term of HODL, which is also the incorrect spelling of Build. It is an advice for investors to contribute new projects on blockchain rather than holding cryptocurrencies and waiting for the price to increase.

DAO: Decentralized Autonomous Organization. It is a corporation that runs without any human involvement, under the control of an incorruptible set of business rules.

ESCROW: means a third party which holds a coin for two parties involved in buying and selling of the coin to avoid fraud or scam.

ERC-20: ERC means Ethereum Request for Comment, and 20 is the proposal identifier. It is one of the most widely used token standards in Ethereum to create fungible, exchangeable tokens.

ERC-721: ERC means Ethereum Request for Comment, and 721 is the proposal identifier. It is one of the most widely used token standards in Ethereum to create non-fungible, exchangeable tokens.

EVM: means Ethereum Virtual Machine. It is the environment in which all smart contracts are executed.

Faucet: it can be a site or an app where a user can repeatedly navigate for small rewards of cryptocurrencies over time.

FORK: This is when the blockchain of a cryptocurrency splits to form or create a new coin on another blockchain. 

Full Node: is a computer program that validates the set of rules that are built into the protocols of a given cryptocurrency.

Gas limit: is the maximum amount of units of gas which a user is willing to spend on a transaction on Ethereum blockchain.

Gas price: is the price which a user is willing to pay for a transaction on Ethereum blockchain.

Halving: it is a programmed event that happens every four years in some cryptocurrencies like Bitcoin, Zcash, which leads to the halving of block miners’ rewards.

Hard cap: is the maximum targeted fund raising of an ICO. 

Hash rate: is the measuring unit of the processing power of the Blockchain network.

ICO: means Initial Coin Offering, synonymous with stock market’s initial public offering. It is used when a crypto project sells some of its coins to raise money in order to develop their project.

KYC: Know Your Customer.

Liquidity: means how fast and easy a cryptocurrency can be bought and sold without affecting the overall market price.

Lightning Network: It is the “second layer” or an off-chain of payment protocol that operates on top of a blockchain. Payments on this network do not need block confirmation and it will be instant.

Mainnet: is the main network of a blockchain where cryptocurrency transactions are being broadcasted, verified, and recorded.

Mainnet Launch: means a specific time a blockchain project is open to the public and begins mass adaptation.

Margin Call: takes place when an investor’s margin account falls below the required amount to stay afloat.

Margin Trading: is a way of investing by borrowing money from a broker to trade.

Maximum Supply: This is the total supply of a coin which can be mined or produced.

Mempool: It is the abbreviation of Memory Pool. Set of unconfirmed transactions in a blockchain.

Mnemonic phrase: also known as seed phrase. It is a list of words created when a new wallet is made to store your cryptocurrency. Mnemonic phrase to recover and restore an individual wallet and cryptocurrencies.

NFT: means non-fungible token. They are unique and not mutually interchangeable.

NODE: This is a computer connected to the blockchain of a coin, which supports the network of that coin in validating and relaying transactions. 

Off-chain: means transactions occurring outside the blockchain and executed instantly.

Private Keys: are the alphanumeric strings which allow transactions from the cryptocurrency address.

PoA: means Proof-of-Authority. It is a consensus algorithm that assigns block validation queue based on identity and reputation.

PoB: means Proof-of-Burn. It is a consensus algorithm that assigns block validation queue based on the coins/token burned by the validator.

PoD: means Proof-of-Developer. It is a concept of identifying the developers of a project as a means of vouching reputation for a project.

PoS: means Proof of Stake. It is a consensus algorithm that assigns block validation queue based on the coins or tokens locked in by the validator.

PoW: means Proof of Work. It is a consensus algorithm in which a block is validated via mathematical hashing.

Pre-sale: an exclusive sale event of a token before the ICO.

Public keys: it is the alphanumeric string or key which serves as a public receiving address in cryptocurrencies.

P2P: It means peer-to-peer. It entails the decentralized interactions that happen between at least two parties in a highly interconnected network. P2P participants deal directly with each other through a single mediation point.

Satoshi Nakamoto: creator of bitcoin and the psuedoym writer behind bitcoin’s whitepaper.

Sharding: a process that seeks to achieve scalability within a blockchain network by partitioning, which means splitting the blockchain network into separate shards, that contain their own data. Ethereum 2.0 make use of sharding.

SHA-256: means Secure Hash Algorithm. It is the cryptographic function used as the basis for bitcoin’s proof of work system.

Smart contracts: these are self executing contracts that can programmed on the blockchain. 

Soft cap: is the minimum targeted fund raising of an ICO. If the soft cap is not met, the funds are returned to the investors.

Staking: involves locking-in a specific amount of tokens in order to serve as a validator in Proof-of-Stake network, which is associated with staking rewards.

Transaction Fee: is a form of payment to the network for performing a transaction to be recorded on the blockchain.

Testnet: shorthand for Test network. It is a software used for experimenting new blockchain features.

Whitelist: list of approved participants that will be given access to a token sale.

Whitepaper: is a brief document published prior towards launching a crypto project. It explains an issue and a possible solution on the issue.

Zero Knowledge Proof: is a cryptographic proof which one party (the prover) can prove to another party (the verifier) that they know a value y without revealing what the value y is.

List of Cryptocurrency Trading Terminologies

ALTCOINS: It means “alternate cryptocurrency”. Essentially any other cryptocurrencies aside from bitcoin.

Airdrops: are free crypto tokens giveaways to promote a project, spread awareness, improve distribution and appreciation of the tokens, and increase the ownership of cryptocurrency.

AML: Anti-Money Laundering. These techniques are used to stop people from converting illegally obtained funds to appear as though they have been earned legally. AML mechanisms can be legal or technical in nature. Regulators frequently apply AML techniques to bitcoin exchanges.

ASHDRAKED: A situation where a trader loses their money.

ATH: is the short word for “all-time high”. 

BEARISH: Negative price movement.

BIP:  Bitcoin Improvement Proposal.

BTC: is an abbreviation for Bitcoin.

BULLISH: Positive price movement.

DCA: means dollar-cost averaging. It is a form of investment strategy in which an investor divides up the total amount to be invested across periodic purchases of a target asset in an effort to reduce the impact of volatility on the overall purchase.

DEGEN: trading without accurate research and diligence.

DYOR: Do Your Own Research. This is used to tell someone to make a personal research on a coin.

DILDO: Long green or red candles on the chart.

DIP: a sharp or fast downward movement of a crypto at the crypto market

Bag Holder: someone who buys cryptocurrency for long term investments, hoping to make gains in the future.

DUMP: This is when traders sell off large quantities of a coin. It can also be used to indicate a sudden sharp drop of a coin. 

DUMPING: Downward price movement.

FA: Fundamental Analysis. It is a common way of analyzing the market through news and information, to determine the direction of the price movement of a cryptocurrency.

Technical Analysis: The use of past market data to make calculated predictions of the next move in the market.

Filled Order: This is when a sell order or buy order on a crypto exchange has been executed.

FOMO: Fear Of Missing Out. A coin is pumping and you have the feeling it is still going to pump more, so you buy high.

FUD: Fear, uncertainty and doubt. The term was adopted in the crypto space to denounce the intentional spread of wrong information.

HODL: Hold on to your crypto assets and do not sell it. “Hold” was misspelled by a frenzied Bitcoin trader on an online forum in 2013. Since then, it has become the mantra in crypto space during market routs, meant to reassure nervous traders.

JOMO: Joy Of Missing Out. It is used to express happiness for not buying a coin that is currently doing poorly.

Leverage: is the use of borrowed capital in trading or investment. For example, you could loan from an exchange to conduct margin trading, where you leverage your positions by buying assets at a low price (with the borrowed money) and sell them at a higher price.

LONG: Margin bull or buy position.

MACD: It is an indicator used in analysing the market of a coin. It means Moving Average Convergence Divergence. 

Masternode: also known as bonded validator system. It incentivizes node operators to perform the core consensus functions of running a blockchain.

MCAP: Market Capitalization. It is used to refer to the total market value of a coin. Coinmarketcap is the popular market capitalization service provider.

Moon: Continuous upward movement of price. Also, a joyous exclamation used by crypto traders, when there is an actual or expected increase in cryptocurrency prices. Also common is “When moon?”

Options: are derivatives that refer to a contract that offer the buyer the right to buy or sell an underlying asset at a specified price and time.

OTC: This means “Over The Counter”. This is a type of trading that happens directly between two interested parties, without the supervision of a third party.

Pump: Upward price movement.

P&D: Pump and Dump. This is used to refer to a market manipulation of a coin which often results in a continuous rise and fall of that coin. This is done to buy the coin cheap and resell again. 

ROI:  It means Return on Investment.

P&D: Pump and Dump. This is used to refer to a market manipulation of a coin which often results in a continuous rise and fall of that coin. This is done to buy the coin cheap and resell again. 

REKT: When someone has a bad loss.

RSI: means Relative Strength Index. It is a crypto trading indicator that is used to point out the overbought and oversold condition.

Shitcoin: A coin with no potential to increase in value.

Short: Margin bear or sell position. It means to predict a downward price movement and then take a position by selling.

SL: It means stop loss. It is a trading strategy to help a trader prevent further loss on a coin, should his prediction fail or should he lose his position in a downtrend. 

SPREAD: This is the difference between the lowest sell price and the highest buy price of a coin or crypto asset. Meanwhile, in OTC trading, it can be referred to as the difference between the price you can buy a crypto asset and sell it immediately.

SWING: This is a zig zag price movement (upwards and downwards). 

TA: Technical Analysis. It means analyzing the market of a coin, based on the charts of the market, using different trading indicators.

TX: an abbreviation for transaction

TP: It means take profit. It is commonly used in crypto trading to describe executing an order set at a target profit price on a trade position.

Weak Hand: A crypto holder prone to selling at the first sign of a dip in price.

WHALE: It is a name for a wealthy trader or market mover with a lot of funds.

List of DeFi Terminologies

AMM: means automated market maker. It is a type of decentralized exchange (DEX) protocol that depends on a mathematical formula to price assets.

DeFI: means decentralized finance. It is an umbrella term for the movement of building a variety of decentralized applications in cryptocurrency and blockchain that have no central authority.

DEXes: means decentralized exchange. It is a technology that supports crypto trading on a distributed ledger without a central authority.

Impermanent Loss: is a temporary loss of funds, experienced by liquidity providers due to volatility in trading pairs. This occurs when the price of your token changes compared to when you deposited them in the pool.

Oracles: are third party services that verify real-world and provide data or external information to blockchains or smart contracts.

Yield Farming: also known as liquidity mining. It involves lending of a cryptocurrency which will be used to provide liquidity. In return, the lender gets rewards.

P.S: In each section the terminologies/abbreviations are listed and explained in alphabetical order. 

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Bitcoin

Bitcoin.org gets hacked, scammers run BTC giveaway scam

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Earlier today, Bitcoin.org, the oldest cryptocurrency website registered by the founder of Bitcoin, Satoshi Nakamoto, recently got hacked. Scammers ran a BTC giveaway scam with a promise to return double the amount users send to the named address. In the end, the scammers were reported to have collected $17,764 before the website was taken down. The website was inaccessible for a few hours after the incident, but normal service has been resumed.

To bring users’ attention to the hack, a pseudo-anonymous Twitter account with the name Cobra took to Twitter to reveal the news and claimed that the website may be offline for some days. He also clarified through his tweets that Bitcoin.org has never been hacked and that the breach must have been due to a lapse on the part of Cloudflare- the web provider that the website is hosted on.

“Bitcoin.org hasn’t been hacked, ever. We move to Cloudflare, and two months later we get hacked. Can you explain where you were routing my traffic too? Because my actual server didn’t get any traffic during the hack” he tweeted.

The scam on the website was perpetrated through a giveaway. Visitors on the website were greeted with a popup, asking them to send crypto to a Bitcoin wallet via a QR code and receive double the amount in return. The fake message showed that the Bitcoin Foundation was giving back to the community and that the giveaway will be limited to the first 10,000 people. This was made to draw more people into the scam.   According to an analysis on the scam address done by Reddit Sleuth, it was presumed that a chunk of the 0.4BTC came from the scammers themselves to add an element of credibility to the claim. At the time of writing this report, Bitcoin.org is once again, back to life.

How popular is the Bitcoin giveaway scam?

Bitcoin giveaway scam is quite popular among hackers as it allows them to make fast money without tampering with anyone’s wallet. In 2020, Twitter handles of top crypto celebrities, politicians and influencers were hacked to run Bitcoin giveaways. While the scammers were apprehended, the value of Bitcoin was not affected.

Today’s scam on Bitcoin.org did not affect the price of the coin either. Despite the Evergrande debt crisis and the fluctuations bedevilling the crypto market within the week, Bitcoin increased by 2.05% within the last 24 hours, thereby moving from $42,789 to $44,378.

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Crypto Assets

Crypto prices drop as global market fear increases

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Top cryptocurrency prices have fallen amidst a drop in stocks and fears over China’s Evergrande debt crisis. In the last 24hour, Bitcoin dropped from $47,772 to $42,630 shedding about 8.58%. this is the lowest in price since another bull run began on Sept 5 after the April crash.

El- Salvador’s President, Nayib Bukele sees the fall as an opportunity to invest more. Recall that the country adopted Bitcoin as a legal tender on September 7. Despite the adoption, the price of Bitcoin has fallen by almost 14% since then.

Other coins have experienced dramatic crashes within the last 24hours. Solana, a coin that has experienced 355% growth within the last 3 months fell from $162 to $130 shedding about 11.39% within the last 24hours. Solana’s fall may be categorized by the 17-hour outage which the founder, Anatoly Yakovenko said was caused by bots “flooding the networks”

Ethereum fell by 9.37% while Dogecoin and Axie Infinity fell by 11.22% and 14.14% respectively within the last 24hrs hours. While crypto experiences dark Monday, El-Salvador keeps investing more money in Bitcoin.

A look at the global market

The global market is experiencing fear due to the Evergrande debt crisis. A report published by the University of Michigan shows that consumer’s sentiment is beginning to decline. This trend alone may impact the crypto market as well.

On the other hand, the global market downturn must have been spurred by the Evergrande debt crisis. The company grew to be one of China’s biggest companies by borrowing more than $300bn. Last year, Beijing made rules to control the debt owed by big real estate developers. This led Evergrande to offer its properties at major discounts to raise more money to keep the business afloat. Right now, the company is struggling to meet the interest on payment of debts.

Why would it matter if Evergrande fails?

The collapse of the multi-million dollars company would affect the global market; including the crypto market. Many people bought properties from Evergrande and they expect to make gains. If Evergrande falls, crypto investors will be forced to withdraw more money to keep their business running without the means to invest more. When one business fails, the other gets affected indirectly. This also applies to other firms that do businesses with Evergrande.

The potential impact on China’s financial system is another effect of Evergrande’s fall. In his statement to BBC, Mattie Berkink, the Economist Intelligence Unit (EIU), said that “the financial fallout would be far-reaching. Evergrande reportedly owes money to around 171 domestic banks 121 other financial firms” if the company fails, other lenders or businesses may be forced to lend less. Thereby leading to a credit crunch- a situation where companies struggle to borrow money.

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Bitcoin

El Salvador’s Bitcoin adoption – What you need to know

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El Salvador made history (and headlines) after becoming the first nation to endorse and approve the world’s most popular cryptocurrency, Bitcoin, as a legal tender. The move makes Bitcoin acceptable for transactions within the Central American country alongside the U.S dollar, which has been serving as the paper currency since 2001. This comes after the so-called “Bitcoin Law” came into force after passing legislation in June of 2021. El Salvador’s government announced that it had purchased 400 Bitcoin in 2 tranches of 200 each and plans to get more in the future.

The move to adopt Bitcoin has been justified by the government’s need to boost financial inclusion in the country. It is estimated that 70% of El Salvadorans do not have access to financial services and the government believes that Bitcoin can help close the gap. The Bank of America has outlined a few benefits that they believe will result from El Salvador’s bitcoin adoption. These include promotion of financial digitization, streamlining remittances as well as opening the country to digital currency miners. However, not all agree that the move is a step in the right direction.

Amongst the detractors of the scheme are the International Monetary Fund and the World Bank, each having warned El Salvador about the risks of Bitcoin’s use as legal tender. The World Bank has been irked by what it described as “environmental and transparency shortcomings” with bitcoin, while the IMF cited “economic and legal concerns” in relation to the move.

Other than the push back from these international bodies, there has been some internal opposition to the adoption of Bitcoin. Citizens had held protests over Bitcoin’s adoption in August and about 67.9% of respondents in a poll said they disagreed with the government’s decision to adopt crypto. The results of the poll showed that 8 in 10 people had little confidence in the use of bitcoin as the currency.

In spite of the criticism, El Salvador’s government is moving forward and has reportedly installed 200 Bitcoin ATMs across the country. And in response to the World Bank’s environmental concerns, El Salvador’s president, Nayib Bukele, has said the country plans to power mining activities using renewable energy from the country’s volcanoes. In order to incentivize the use of Bitcoin in the country, any citizen who signs up for the country’s “Chivo” wallet will get 30$ worth of bitcoin.

All in all, the adoption of a cryptocurrency by a sovereign nation is seen as a testing ground for many, as this is a use case Bitcoin has never experienced in its 12-year history. Countries such as Brazil and Panama seem to be watching the move to draw insights on whether to follow suit.

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