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The fast-moving world of crypto can be complex, so we have 15 crypto terms you must know.
The fast-moving world of crypto can be an exciting yet complex subject to grasp. This is why Nexus has comprised a list of 15 crypto terms you must know to get a good start in crypto.
Why are these terms important?
Traders, developers, and crypto-enthusiasts alike all have the same thing in common. They do not like wasting time and they are usually up for a good meme or Twitter post. This has resulted in some interesting abbreviations and slang in the crypto-sphere.
Get smart and read further about what they are.
Bitcoin is often considered the holy grail of cryptocurrencies.
It was the first blockchain currency and is still, to this date, the largest crypto by market cap. Altcoins are anything BUT Bitcoin.
Another way to explain the term "altcoin" is concerning it as an "Alternative protocol asset", which suggests they follow a particular set of rules (also referred to as a protocol) that's different from what bitcoin uses.
“ATH” is an acronym for All-Time High, this is often the best price a Cryptocurrency has attained. If the value of a Cryptocurrency surpasses its previous A.T.H, a new A.T.H is created.
Throughout the wildlands of the blockchain, there's one distinct word that gets thrown around quite often. ”Ape” or “Aping” refers to investing a sizable amount into a high-risk crypto-currency to realize high rewards.
To put this into context, if I were to ask ‘ What coin are you aping into?’ I might mean ‘What coin are you investing lots in?’.
D.C.A, also known as Dollar-Cost-Averaging, is a widely accepted investment technique that is used by both pro-traders as private investors. The thought behind this is to periodically purchase targeted assets, no matter the price, over a certain period to reduce the volatility of the desired asset.
With dollar-cost-averaging, you invest incrementally throughout your time, rather than all without delay.
This method works well for those that work the 9 to 5 and are eager to invest a little of their paycheck weekly or monthly.
"FOMO" is otherwise referred to as "Fear Of Missing Out”.
FOMO tends to arise when investors hear excellent news or see a dramatic price increase. This combined with personal & emotional expectations can result in being a victim of FOMO.
Remember, FOMO could be a NO-NO.
"F.U.D", Fear, uncertainty and doubt.
The thought behind this nonsense is that somebody or possibly a group of people spread false or misleading information to cause an asset's price to fall. This permits them to buy at a cheaper price and increases the potential of constructing profit.
"H.O.D.L", the acronym for "Hold On For Dear Life", originally came from a spelling error of the word "hold.'' It's well-known that digital currencies occasionally are often extremely volatile & in time traders would start using the term H.O.D.L while experiencing significant price fluctuations.
An Initial Coin Offering (I.C.O) is the first time an organization offers digital tokens to the general public as a trial to boost funds. Businesses hold these offerings frequently so that they can finance projects.
Market cap, short for capitalization. This is often a term used for the “total value” of a currency's market. For example, The market cap of a cryptocurrency is the number of tokens in circulation, multiplied by the value of BTC.
When someone says a digital currency is getting ready to “Moon” or is “Mooning”, this suggests it's or is dramatically rising in value. For instance, you could hear traders discuss how an altcoin goes "to the moon!", which might indicate that the token value is growing sharply and quickly.
Before you jump onto a 'mooning coin', remember what we just told you about F.O.M.O. ;)
The term "pump and dump" refers to a kind of investment where a person/group inflates the value of an asset so that they can sell it when its value is artificially high. These events occur regularly as traders can easily get together using Telegram groups to cause specific cryptocurrencies to rise sharply in value.
R.O.I or Return on investment allows you to know what profit or loss an investment has created, this is often expressed within the variety of a percentage. Utilizing this percentage you'll be able to then compare the profitability & effectiveness of various investment choices.
To calculate this can be rather simple, you divide your earnings or loss from an investment by its original cost, leaving you along with your R.O.I percentage.
This is the pseudonym of the ever-elusive creator of bitcoin.
Many of us have claimed to be the legendary Nakamoto, but still, to the present day, we are yet to seek out the reality.
A token is what's cited as a unit of digital currency, for example, bitcoin or Ethereum.
Take note that there are specific tokens that are utilized in specific ecosystems, which are commonly remarked as Utility Tokens.
A wallet address is very similar to the physical wallet most of you have in your bag or back pocket. It is owned by you and you alone and only you can access your wallet, as opposed to a checking account with a bank that is controlled by your bank which is usually controlled by your government.
These addresses are usually made of an extended series of numbers and letters and secured by a seed phrase. Remember to have your seed phrase written down somewhere safe and secure. Should you lose your seed phrase, nobody can facilitate the retrieval of your wallet and its contents!
Whales are best described as traders who own vast amounts of one token. Whales have the flexibility to execute extremely large transactions with the potential to govern a market to ”make waves”.
Developers that make digital currencies usually provide a report called a White Paper. This document should contain comprehensive information about the said digital token, from tokenomics, contract address, and other relevant information to the token. You might remember this from our other blog (How to Spot a Rug Pull) but if the project you are interested in does not have a White Paper it is considered a red flag.
So there you have it, 15 Crypto terminologies commonly utilized in today's social environments!
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Stay Sharp Nexus!