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Cryptocurrency is a digital or virtual currency that uses cryptography for security and operates independently of a central bank. Examples include Bitcoin, Ethereum, and Litecoin.
Blockchain technology is a decentralised digital ledger that records transactions across multiple computers so that the record cannot be altered retroactively. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data.
Bitcoin is a digital currency primarily used as a store of value and medium of exchange. Ethereum, on the other hand, is a decentralised platform that enables smart contracts and decentralised applications (dApps) to be built and run without any downtime, fraud, control, or interference from a third party.
Altcoins are cryptocurrencies other than Bitcoin. Examples include Ethereum, Ripple, Litecoin, and many others. They often serve different purposes or improve on perceived limitations of Bitcoin.
cryptocurrency wallet is a digital tool that allows users to store, send, and receive cryptocurrencies. Wallets can be hardware-based or software-based and provide a secure way to manage digital assets.
The value of a cryptocurrency is determined by supply and demand dynamics in the market, investor sentiment, utility, and various other factors such as media coverage and market liquidity.
A blockchain explorer is a web application that allows users to search and view information on a blockchain network, including transaction histories, block contents, and address balances.
A public ledger is a transparent record of all transactions that have occurred on a blockchain network, accessible to anyone.
A private blockchain is a type of blockchain that restricts access to certain nodes or users. It is often used by companies and organisations for internal purposes where privacy is a concern.
Decentralisation refers to the distribution of control and decision-making away from a central authority, relying on a network of nodes to validate transactions and maintain the blockchain.
A cryptocurrency address is a string of alphanumeric characters that is used to receive cryptocurrencies. It is unique to each wallet.
A seed phrase is a sequence of words generated by a cryptocurrency wallet that gives access to the wallet's private keys. It is used for recovery purposes.
A paper wallet is a physical document that contains a cryptocurrency address and its corresponding private key, usually represented as QR codes. It is used for offline storage of cryptocurrencies.
A hardware wallet is a physical device that securely stores a user's private keys offline, protecting them from hacks and malware.
A software wallet is a digital wallet that stores a user's private keys on their computer or mobile device. It is convenient for transactions but less secure than a hardware wallet.
A mnemonic phrase is a human-readable representation of a private key, often consisting of 12 or 24 words. It is used to backup and restore a cryptocurrency wallet.
Hash rate is the speed at which a computer or mining hardware can complete a hash operation, used to measure the processing power of the Bitcoin network.
A nonce is a random or semi-random number that miners use to vary the input of a hash function. It is used to find a hash that meets the network's difficulty target.
The genesis block is the first block in a blockchain, often referred to as Block 0 or Block 1. It is the foundation of the blockchain and is hardcoded into the software.
A distributed ledger is a database that is consensually shared and synchronized across multiple sites, institutions, or geographies, allowing transactions to have public "witnesses."
Cryptography is the practice of securing information by transforming it into an unreadable format, used in cryptocurrencies to secure transactions and control the creation of new units.
A Merkle tree is a data structure used in blockchain technology to efficiently and securely verify the integrity of data.
ERC-20 is a technical standard used for smart contracts on the Ethereum blockchain for implementing tokens. It provides a list of rules that Ethereum tokens must follow.
An ICO is a fundraising method in which new projects sell their underlying crypto tokens in exchange for Bitcoin or other cryptocurrencies.
Tokenisation is the process of converting rights to an asset into a digital token on a blockchain. It allows for easier transfer and division of ownership.
A whitepaper is an authoritative report or guide that explains the theory behind a new technology or project, often used in the context of cryptocurrencies to describe the details of a new coin or token.
A governance token is a token that gives holders the right to vote on decisions that influence the core protocol of a blockchain project.
Interoperability is the ability of different blockchain systems to communicate and operate with each other, enabling transactions and data to be shared across different networks.
A DAO is an organisation represented by rules encoded as a computer program that is transparent, controlled by organisation members, and not influenced by a central government.
Gas is a unit that measures the amount of computational effort required to execute operations on the Ethereum network. It is used to pay for transactions and smart contract executions.
A dApp is an application that runs on a decentralised network, typically utilising blockchain technology.
A token is a digital asset that represents a unit of value on a blockchain. Tokens can be used for various purposes, including as currency, utility, or security.
A smart contract is a self-executing contract with the terms of the agreement directly written into code. It runs on a blockchain and automatically enforces the terms of the contract when predetermined conditions are met.
Staking is the process of participating in the validation of transactions on a PoS blockchain by locking up a certain amount of cryptocurrency as collateral.
Proof of Work (PoW) is a consensus algorithm that requires participants to perform work (solve mathematical problems) to add a block to the blockchain.
Proof of Stake (PoS) is a consensus algorithm where participants validate block transactions based on the number of coins they hold and are willing to "stake" as collateral.
Liquidity refers to how easily a cryptocurrency can be bought or sold in the market without affecting its price. High liquidity indicates a stable market with low price volatility.
A trading pair is a market between two types of cryptocurrency. For example, the trading pair BTC/ETH refers to the market where Bitcoin can be traded for Ethereum
A limit order is an order to buy or sell a cryptocurrency at a specific price or better. It is not guaranteed to execute, but it allows traders to control the price at which they buy or sell.
A market order is an order to buy or sell a cryptocurrency immediately at the current market price. It guarantees execution but not the price.
Market capitalisation is the total value of a cryptocurrency, calculated by multiplying its current price by its total supply.
Yield farming is a DeFi strategy where users provide liquidity to a protocol in exchange for rewards, often in the form of additional tokens.
A liquidity pool is a collection of funds locked in a smart contract that provides liquidity for decentralised exchanges and other DeFi protocols.
Sharding is a method of partitioning a blockchain network into smaller, more manageable pieces called shards, each capable of processing transactions independently to improve scalability.
A sidechain is a separate blockchain that is attached to its parent blockchain, allowing tokens and other digital assets to be moved between them.
A wrapped token is a cryptocurrency token that represents another asset, usually on a different blockchain, allowing that asset to be used within a different ecosystem.
A hard fork is a radical change to the protocol of a blockchain network that makes previously invalid blocks/transactions valid (or vice-versa), requiring all nodes or users to upgrade to the latest version of the protocol software.
A soft fork is a change to the software protocol where only previously valid blocks/transactions are made invalid. Most soft forks require miners to upgrade their software.
An atomic swap is a smart contract technology that enables the exchange of one cryptocurrency for another without the need for a trusted third party.
Tokenomics refers to the economic model of a cryptocurrency, including its distribution, supply schedule, and incentives for holders and users.
Cryptojacking is the unauthorized use of someone else's computer to mine cryptocurrency. This can be done by installing malware on the victim's computer or through a web browser.
A cold wallet is a type of cryptocurrency wallet that is not connected to the internet, providing enhanced security against hacking. It includes hardware wallets and paper wallets.
A hot wallet is a cryptocurrency wallet that is connected to the internet, making it more convenient for transactions but less secure compared to cold wallets.
FOMO is the feeling of apprehension for missing out on a potentially profitable investment opportunity, often leading to impulsive decision-making.
FUD is a strategy to influence perception by spreading negative and dubious or false information, often to manipulate market sentiment.
A 51% attack occurs when a group of miners controls more than 50% of a blockchain network's mining hash rate, potentially allowing them to double-spend coins and prevent new transactions from being confirmed.
A hash function is a cryptographic algorithm that converts an input of letters and numbers into an encrypted output of a fixed length. It is used to secure transaction data on a blockchain.
A mempool is a pool of unconfirmed transactions that each node in a blockchain network maintains. Transactions wait in the mempool until they are confirmed by the network.
A DEX is a type of cryptocurrency exchange that operates without a central authority, allowing users to trade directly with one another.
A pump and dump scheme attempts to boost the price of a cryptocurrency through false or misleading statements, in order to sell the cheaply purchased asset at a higher price.