Demystifying the Top Cryptocurrency Jargon

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Cryptocurrency investing can be daunting for many potential investors with complex systems and theory unfamiliar to many. The language employed by the cryptocurrency community is just as terrifying with words seemingly plucked out of thin air. The list below highlights the latest terms used within the cryptocurrency space that may make your journey to investing and understanding cryptocurrencies both easier and safer.

Most Popular Cryptocurrency Terminology, Phrases, Acronyms and Definitions

Airdrop – Distribution of cryptocurrency coins (usually for free), to promote awareness, usage and growth. This marketing exploit has gained popularity withing the cryptocurrency community and upcoming ‘Crypto Airdrops’ can be viewed on various crypto airdrop calendars online.

ATH (All-Time-High) – The highest price that a cryptocurrency has reached throughout its history.

ATL (All-Time-Low) – The lowest price that a cryptocurrency has reached throughout its history.

Altcoin – Any other cryptocurrency coin that emerged after Bitcoin. Altcoin is an abbreviated term for ‘alternative coins’.

BTD (Buy The Dip) – This is a term used when referring to buying a cryptocurrency token/coin at a low price point.

Burned – When cryptocurrency tokens/coins have been permanently removed from rotation, this is known as being ‘burned’.

CBDC (Central Bank Digital Currency) – Virtual or digital currencies issued by a central bank which allows for the inclusion of government regulation and law. Sometimes called “govcoin or govcoins.”

Chain Split – Used interchangeably to a ‘fork’, a chain split involves the separation from a source token/coin to a separate ledger.

Cold Wallet – An offline wallet.

DAPP – A decentralized application that has no centralized control or influence.

DeFi – Decentralized Finance.

DEX (Decentralized Exchange) – Allows investors to trade cryptocurrencies without the necessity for an intermediary.

Dolphin An individual who holds a moderate amount of cryptocurrency.

DYOR (Do Your Own Research) – Promotes crypto investors to conduct proper due diligence before investing.

ELI5 (Explain Like I’m 5) – Commonly seen in online crypto discussions and forums whereby novice investors require simplified explanations regarding cryptocurrency concepts.

FOMO (Fear Of Missing Out) – This refers to the fear of missing out on a trade opportunity, particularly when a cryptocurrency experiences notable price increases within a relatively short period of time.

FUD (Fear, Uncertainty & Doubt) – Spreading misleading information to impose a negative connotation around a cryptocurrency or cryptocurrencies in general.

Fiat – Government issued currency.

Fish An individual who holds a small/insignificant amount of cryptocurrency.

Fork When existing software/protocol changes, there is a blockchain divergence which creates a new spinoff version to the old version.

Fungible – This term explicates the equivalent nature of a token/coin. For example, one Bitcoin can be interchanged with another Bitcoin and will be worth the same value.

Gas – Cost (computational effort) incurred when executing Ethereum transactions.

HODL (Hold On for Dear Life) – Holding onto cryptocurrency tokens/coins for an extended period of time.

Hard Cap – Maximum supply of a digital currency.

Hot Wallet – An online wallet.

ICO (Initial Coin Offering) – Unregulated practice by which funds are raised for new cryptocurrencies.

JOMO (Joy Of Missing Out) – Often used by individuals who do not succumb to popular ‘herd’ behavior by other crypto investors.

KYC (Know Your Customer) – Compliance information required by exchanges to adhere to regulations.

Mooning – A term used to refer to the upward price trajectory of a cryptocurrency.

Node – A computer that validates transactions.

NFTs (Non-Fungible Tokens) – An exclusive digital asset that can represent anything.

REKT– Describes an adverse/losing trade. Short for ‘wrecked’.

SATS (Satoshi) – Smallest unit of Bitcoin (BTC) = 0.00000001.

Stablecoin – Cryptocurrencies that attempt to peg their price to another cryptocurrency, fiat currency or asset.

TLT (Think Long Term) – Investment outlook that is long-term.

Weak Hands – When investors panic sell at the first sign of price decay.

Wei – Smallest unit of Ethereum (ETH) = 1 ether = 1,000,000,000,000,000,000 wei.

Whale – An individual who holds a large amount of cryptocurrency.

When Moon – A common question used when referring to ‘when’ a cryptocurrency will boom.

Whitepaper – A template outline or document that is released by a cryptocurrency project explaining its outlook for growth and any associated technical information.

Yield Farming – Earning high returns by investing in cryptocurrencies on decentralized financial markets.

Zero-Knowledge Proof – Forms part of cryptography whereby something is proven without disclosing the sensitive data of the transaction.

VIRTUAL CURRENCY DISCLOSURE

DAILYFX IS A MEMBER OF NFA AND IS SUBJECT TO NFA’S REGULATORY OVERSIGHT AND EXAMINATIONS. HOWEVER, YOU SHOULD BE AWARE THAT NFA DOES NOT HAVE REGULATORY OVERSIGHT AUTHORITY OVER UNDERLYING OR SPOT VIRTUAL CURRENCY PRODUCTS OR TRANSACTIONS OR VIRTUAL CURRENCY EXCHANGES, CUSTODIANS OR MARKETS.

— Written by Warren Venketas for DailyFX.com

Contact and follow Warren on Twitter: @WVenketas

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