Cryptocurrency mining – an expensive, resource-intensive process that can make even high-powered computers work hard to solve math problems and get paid with crypto coins in return. Since this process involves so much technical jargon, it cannot be easy to understand. Understand what the heck it means or how to get started. To help you out, we’ve put together this crypto slang terms list that you need to know so you’ll be able to enter the world of crypto mining as quickly as possible!
Crypto mining terminology
Before we go into terminologies employed in crypto mining, let’s understand what cryptocurrency is. Cryptocurrency – a digital asset designed to work as a medium of exchange using cryptography to secure transactions and control the creation of additional units. Cryptocurrency relies on blockchain technology, where all transactions made are recorded publicly and in an immutable way. Here are some of the crypto mining terminology you must know.
A blockchain is a public ledger of all cryptocurrency transactions that have ever been executed. The data on any given block cannot be altered retroactively without altering all subsequent blocks, which requires consensus among network participants. At their core, blockchains are just databases stored in multiple copies across a decentralized network of computers.
People use the term Fiat to help differentiate between real money and cryptocurrencies. It was used about a currency decree by a government. This means that it has value because of government regulation or the law. This contrasts with commodity money, such as gold, silver, copper, etc., which have value because they are precious metals.
In crypto, miners are people who run computer hardware and use it to solve cryptographic puzzles. When they solve a puzzle, they receive a block reward in cryptocurrency. Mining is what secures blockchain networks and enables them to function. It’s also how new coins introduced into circulation.
NFT in the crypto world stands for Non-Fungible Token. This type of cryptocurrency is unique and can’t be replaced by another token. If you own an ERC-721 token, no one else has the same token as yours. The most popular example of NFT is CryptoKitties. It’s possible to buy, sell or trade your kitty just like any other digital asset, but each kitty has its own identity on the Ethereum blockchain.
A crypto token is a unit of value that an organization creates to self-govern its business model and empower its users to interact with its products while facilitating the distribution and sharing of rewards and benefits to all stakeholders. It represents ownership of a utility or tradable asset that resides on top of a blockchain platform. (i.e., Bitcoin, Ethereum). It allows access to features and services within its ecosystem.
The most popular example of a crypto token is Bitcoin (BTC). BTC created to reward miners who helped validate transactions on its network by solving complex mathematical problems using computing power. As more people started using BTC, demand grew, which led to higher prices, attracting even more miners – creating an upward spiral effect known as the halving effect, where supply decreases as demand increases.
This will probably not be a term that you hear regularly, but it’s still an important concept for beginners in cryptocurrency. A bitcoin maximalist believes there will only ever be one dominant cryptocurrency (bitcoin) and that all others will eventually fade into obscurity or extinction. Typically, bitcoin maximalists feel like most other cryptocurrencies are tulips of their day or simply scams.
Crypto is a means of securing information that makes it unusable to anyone who does not have access to specific keys. Cryptography is primarily used in digital systems, though it can also be applied in analog systems.
This is the direct exchange of currency between two parties without involving a third party in cryptocurrencies. Cryptocurrencies use a P2P system to process transactions; each node (computer connected to a network) gets a copy of the blockchain (record of all transactions), downloaded automatically.
When a computer connects directly to another computer (or group of computers), in simple terms, and transfers data over a network without going through a central server. Networks that use P2P technology are inherently decentralized. Because there is no central point of failure or control. For example, BitTorrent uses P2P technology to enable users who share files directly.
Crypto slang terms
Crypto slang terms using in every industry, and cryptocurrency is no different. The following is a list of crypto slang terms that will help you keep up with your peers.
To the Moon
This term using when a token or coin’s price increases rapidly. In other words, if a coin goes to the moon, it means that its value has experienced an upward trend in price. It’s used to express enthusiasm for a certain cryptocurrency project.
This term using for any cryptocurrency that isn’t Bitcoin. Altcoins are often viewed as less valuable than BTC because of their short history and lack of development. Although some have proven their worth and gained significant value over time.
This term refers to how cryptocurrency miners take over a computer or device and use it for mining purposes. The computer’s owner is then left with no control over their system and might suffer from reduced performance and higher energy costs.
DeFi refers to decentralized finance and describes financial products. Such as loans or insurance that a third party issues. Many of these products applied on top of any blockchain and designed for everyday users.
FUD refers to fear, uncertainty, and doubt. It’s commonly used in cryptocurrency markets and describes when investors start selling off their tokens because they believe prices will drop.
The world of cryptocurrency mining employs a lot of jargon that can be difficult for newbies to understand. If you’re looking to get into it, make sure you familiarize yourself with these common words and phrases so that when someone says something like I’m going long on LTC or I shorted BTC today, you won’t have any trouble understanding what they mean.