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Cryptocurrency Jargons You Should Know About

There are many things you should know about cryptocurrency. Doing your research in any field of expertise is all about looking at other people’s opinions and coming across different perspectives. Searching through certain platforms, watching videos on YouTube, and hearing from experts or someone you know that is dealing in the same market – this and everything related is like tools you keep in your toolbox. So, if you use more tools, there are higher chances of you feeling confident in the decisions you make.

Furthermore, every method or tool you use is to provide you with a thorough understanding of a coin along with the future plans, for example, will the price of the coin increase in the future? Or will the price of the coin fall in the future? When dealing with cryptos, you have to be quite vigilant and attentive to the market surroundings.

Knowing what works best for you in the long term is highly beneficial for your future investments as well. Apart from that, has turned life around for so many people. You can use it to be familiar with the price movements and trade bitcoins swiftly whenever you want.

While dealing with cryptocurrencies, there are certain phrases or words that you must know. If you don’t, you will have trouble understanding what’s happening in the crypto world or what the professionals are talking about. Have a look at some crypto jargon below.

1.  Altcoin

It is a combination of two words. One is ‘alternative’, and the other is ‘coin’. It means any cryptocurrency apart from bitcoin which is considered to be an original cryptocurrency.

2.  Cryptocurrency Exchanges

Binance, Coinbase, Bitstamp, and Gemini allow investors and traders to sell and buy cryptocurrencies. These are known as cryptocurrency exchanges. It is quite different from traditional stock markets. Cryptocurrency exchanges take place on the internet only and are accessible for users 24/7.

3.  Limits

Some exchanges don’t set any restrictions or limits on the number or frequency of cryptocurrency trades that users make each day. When we talk about difficult trading days, especially when the prices of cryptocurrency are either going down or up rapidly, some brokers put a temporary halt on those who deposit funds on their respective platforms.

4.  Shorting

When someone says they are shorting cryptocurrency, it means that they bet on the price when it goes down instead of the price going up.

5.  Forks

A fork is basically a division in a blockchain. Here, two different blockchains are made. In the year 2017, bitcoin actually forked into two blockchains, one being bitcoin and the other being bitcoin cash.

6.  ICO

ICO stands for initial coin offering. It is just like an IPO – an initial public offering, also known as float. ICO is the platform where new cryptocurrencies are sold to traders or investors in the initial phase.

7.  Margin Trading

Margin trading refers to when investors borrow an amount of money so they can increase their bets on any cryptocurrency.

8.  Fiat

A fiat currency refers to the one being supported by any sovereign government. For example, US dollars, sterling, or Indian rupees.

9.  Cloud Mining

People can create or mine cryptocurrencies so that they can enter the competition to gain rewards in the shape of minted crypto. Moreover, cloud mining makes use of data centers operating remotely. They have a shared processing power, just like something that can power Google software. They pool resources which leads to reduced cost of mining. However, you have to be very careful of these cloud mining companies, as they are mostly scams.

10. Bear Markets and Bull Markets

You will hear these phrases in traditional stock markets as well. A bull market is one where traders have confidence in a specific investment’s prospects. This means that they will continuously buy and the rise in prices will occur. In contrast, a bear market involves nervous traders where prices generally fall.

10. Sell Orders

It is an instruction that traders give to a platform. They allow people who own cryptocurrency to sell it when the price strikes a particular level. However, in a traditional market, sell orders are basically known as “stop-loss”.

11. Order Book

It means a list of all such traders on a specific cryptocurrency brokerage or exchange who are looking to trade (sell or buy) cryptocurrency for a specific price.

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