Getting started in cryptocurrency is a seemingly simple process. However, it is complicated by the technology and concepts that underpin the market. The technical language used to talk about cryptocurrency investment makes even the most interested individuals shake their head and turn away. All of the jargon and crypto slang serve as obstacles for beginners who want to be involved in crypto.
If you are one of the people intimidated by the market, don’t heave a sigh and give up. Read on. Let’s understand the jargon and learn crypto-slang together.
Jargon in the Crypto World
Bitcoin was the first and original cryptocurrency. In the cryptocurrency community, anything else is considered as an Altcoin. A few examples are Litecoin, ZCash, Ripple, and Dash. As of 2019, there are more than 2200 coins listed in CoinMarketCap – a site used to track and analyze the crypto market.
If you are interested to know which altcoin to invest now, check out my guide on the best altcoins.
Blockchain is the technology behind cryptocurrency. In simple terms, it is a distributed digital ledger of transactions that is secure and permanent. Each recording is called a block. A series of blocks link together to form the blockchain.
Buy Walls and Sell Walls
Buy walls and sell walls are tools to manipulate the market. A sell wall is used to prevent prices from going higher, which if successful, allows you to purchase more currency at lower prices. A buy wall is the exact opposite. It is done to prevent the prices from going lower.
Here’s a hypothetical situation. If you want to buy a huge amount of currency and place several buy orders, its price will increase and affect the market. Instead, you could try putting up a sell wall. Put a sell order for a huge amount of crypto. This will make it seem like a big player knows something is about to happen. It will create a panic, which will cause other investors to sell their currency at a price lower than yours. If you want to sell your currency, put a buy wall instead.
Cryptography is a method of encrypting and decrypting information so it can only be viewed by its intended recipients. This is done using a mathematical algorithm called cipher. In cryptocurrency, it is used to secure and verify transactions.
Every now and then, developers change the rules and protocols governing cryptocurrencies, leading to a split in the blockchain. When this happens, it is called a fork. A soft fork is basically when updates are made to a chain while a hard fork refers to changes in protocol that create a new and separate version of the chain.
The genesis block is a term used to refer to the first block ever mined in the Bitcoin block chain by the cryptocurrency’s creator, Satoshi Nakamoto.
When a computer program turns information into a string of letters and numbers, that is called hashing. This protects information from tampering and strengthens its security.
Also called Market cap, or MCAP, this term simply refers to the total number of coins in circulation multiplied by the price of an individual coin. This is helpful in determining the value of a currency.
Mining refers to the process of validating information and then adding that information into the blockchain.
It is important you keep this to yourself. A private key is a string of letters and numbers enables you to spend or access your digital currency. Think of it as a password you need to keep safe. Private key is usually use to access your bitcoin wallet.
Also a composed of numbers and letters, a public key lets you receive digital currency.
Slang in the Crypto World
Now that you’ve got an overview of basic technical terms, let’s take a look at the slang terms beginners should acquaint themselves with. Nothing screams newbie more than being unfamiliar with these terms. In order to start a dialogue or join a conversation, you need to make sense of it first.
Bags are crypto assets that were bought at a higher price than the current market value. A person who hold onto these assets with decreasing value is called a bagholder.
Do Your Own Research. In the world of cryptocurrency, which is highly speculative in nature, you are encouraged to educate yourself instead of blindly follow others’ advice.
Used to describe an event that has yet to happen, flippening refers to a future probable scenario where Bitcoin seizes to have the highest market cap, and is overtaken by Ethereum.
When tokens are at an all-time high, people have the Fear Of Missing Out (FOMO), which makes them want to get in on the hype. On a related note, the Joy Of Missing Out (JOMO) is also a thing, which is used to express relief when the hype wasn’t worth it and they didn’t let it get to them.
Fear, Uncertainty, and Doubt (FUD) is when negativity is spread about cryptocurrency. It is used to describe an strategy to manipulate market prices, which involves spreading misinformation to lower prices. Peddlers of FUD are called FUDsters.
Hold On For Dear Life (HODL) is the mantra of traders when movements in the market, such as fluctuations in price, happen. It was originally a misspelling of the word “hold.”
Pump and Dump (PND)
This is a practice done by single or multiple people to manipulate the price of currency. Prices are quickly inflated so they can be sold at a high price. This is usually followed by a crash in the market.
A slang term for the word “wrecked,” Rekt is used to describe a trader to who lost a ton of money from a bad trade.
Sats, the shorthand of Satoshis, refers to the smallest unit of a Bitcoin.This term is a nod to the first digital currency’s creator.
To the Moon
This slang term is used when prices increase rapidly. It can be used both as a noun and a battlecry. Alternative forms of this slang are “When moon,” used to describe the time of sharp rise; and “Mooning” for the verb form.
Whales are big players in the cryptocurrency market. They possess a large amount of coins and can cause major movements such as crashes or dips in the market.
There are quite a number of whales in the crypto world including some crypto millionaires mentioned in this article.
When taking on new pursuits such as cryptocurrency, understanding the language is central to your success. Before you can devise an effective strategy or select appropriate tools to help you buy, trade, and monitor the market, you should have a certain level of crypto-literacy.
Hopefully, this article contributed to that effort by clarifying important terms and explaining essential concepts. In this way, you are more informed and subsequently more equipped to make a decision. Are you feeling more confident to play the cryptocurrency market?