With the launch of Bitcoin in 2009, cryptocurrency, or “crypto”, has taken the business and investment world by storm. From its beginnings as a strategic response to the fallout following the 2008 financial crisis, cryptocurrency has emerged into something much greater and has led to the almost unforeseen creation of the vast blockchain technologies and tokens circulating the world today. If you want to learn more about how cryptocurrencies work and to pick up some handy terms along the way, keep reading – we’ve put together this handy guide to everything you need to know.

What is cryptocurrency?

Cryptocurrency is a digital currency with which users can make payments and exchanges without engaging an intermediary, such as a bank or another financial institution. It achieves this through cryptography, which it uses to secure information and transaction data performed in its ledger, called the blockchain.

But don’t think cryptocurrencies end with transactions and storing value. They can also deploy and carry out decentralised applications and coordinate contracts operating through blockchain networks.

Cryptocurrencies are different from traditional fiat currency, as they’re purely digital and belong solely to the individual.

 

Handy terms you need to know

Whether you’re launching into the world of cryptocurrency or are a seasoned user or investor, it can be an overwhelming landscape. In fact, there are almost as many terms as there are currencies – so you can imagine just how much confusion might face someone who’s new to the scene. Here are our recommendations for the top terms you need to know when navigating crypto.

Altcoin

This term, which combines the words “alternative” and “coin”, is given to all cryptocurrencies established following Bitcoin. Altcoins are exactly what the name implies – alternatives to Bitcoin, with their own purpose, use and users.

ATL and ATH

ATL stands for “All Time Low”, or the lowest price per unit of a token or coin. In contrast, ATH represents “All Time High”, and generally refers to the highest price per unit of these coins or tokens.

Bear or Bearish

Describes investors or trends that result from the belief that an asset will lose value.

Bitcoin

The first cryptocurrency was originally launched in 2009 and was known as Bitcoin.

Block

A storage container that contains transactional data. After they’re filled, blocks are stored in a chain – or blockchain – in which they can be accessed and viewed by the public at any time.

Blockchain

Essentially a bank’s ledger, but in digital form, a blockchain records transactions and is maintained as a public, online and decentralised database.

Bull or Bullish

The opposite of “Bear” or “Bearish”, this term refers to trends or investors motivated by the belief an asset will rise in value.

Burn or Burned

Referring to the removal of tokens from the available supply. Burning tokens raises relative scarcity.

Cryptography

The method of encoding information to maintain confidentiality and integrity. Cryptography allows for transactions to be carried out safely and securely by authorised persons.

Capitalisation

The number of coins on the market, multiplied by the unit price.

Circulating Supply

Cryptocurrency units, tokens or coins currently available on the market.

Decentralised

Independent of governmental or central control, but rather managed by all users.

dApps or Decentralised Applications

A program employing blockchains to hold data. Such applications run independently of control via a single entity.

Decryption

The transfer of encryption to plain text.

Dump or Dumping

The sale of a significant amount or all of a user’s cryptocurrency.

Encryption

Securing data through the conversion of information into a code that conceals true details.

Escrow

An intermediary responsible for holding funds during transactional proceedings, acting as a third party between the sender and receiver.

Exchange

The facilitation of sales and purchases of assets, such as bonds, currencies and stocks. Through these exchanges, individuals can sell and buy digital currency.

Fiat currency

Any currency that a government recognises as legal tender.

FOMO

“Fear Of Missing Out”.

Fork

Any updates to protocols or software.

FUD

“Fear, Uncertainty, Doubt”.

Full Node

A program used to validate all transactions and blocks within a blockchain.

Gas

The fee used to perform a transaction or carry out a contract.

ICO

Stands for “Initial Coin Offering”, which is a means by which startups fundraise by offering products and services.

Ledger

A system of keeping records that maintains anonymity while also storing all information about user balances and transactions.

Liquidity

The ease with which an asset can be bought and sold.

MACD

“Moving Average Convergence/Divergence”, or an indicator used to analyse stock prices, indicating any changes in trends.

Market Captialisation or MCAP

The value of a crypto market. MCAP is determined by multiplying the market price by the number of coins available.

Moon

A “mooning” token is one that displays notable upwards trends.

Mining

The process used to validate, record and broadcast crypto transactions.

Node

A computer that stores blockchain, checks the authenticity of transactions and broadcasts the blockchain to other network computers.

Protocol

The rules that permit sharing of information between computers.

RSI

“Relative Strength Index”, or an indicator used when assessing the market.

Satoshi or SATS

Named after Satoshi, the creator of Bitcoin, SATS is the smallest bitcoin unit – 1/1,000,000 of a bitcoin.

Smart Contracts

An agreement between parties is stored as computer code on a database and is unable to be altered.

Token

An asset that lives on a blockchain and can be easily traded as a currency.

Volatility

Tending to an unpredictable, rapid change, especially for a worse outcome.

Wallet

A sort of internet banking system, which stores information regarding your dealings. This might include addresses, transactions, balances, and account keys.

Whale

Slang used to describe a significant investor whose actions generate real change in the market.

 

Interested in cryptocurrency? Choose Venuesmart

While this glossary list isn’t exhaustive, we hope it’s given you a better sense of the world of crypto. Cryptocurrency can prove incredibly beneficial for businesses, especially through OTC trading, which occurs away from the digital space and usually via a broker, a chat room, or using an ATM. There are great benefits to using OTC over other methods – you’ll save money, deter low trading limits, enjoy a faster trading time, and engage a trusted, experienced broker in the process.

That’s where Venue Smart comes in. As payment acceptance specialists, we’ll take the time to get to know your business, help update your payment methods, and improve your efficiency with our proven methods, including OTC trading. Call us today on 1300 4 VENUE (1300 483 683) to learn more about our services and how they can benefit your business.