Crypto Lexicon

In the crypto world, it is sometimes not so easy to understand all terms. We have listed the most important terms here and their meaning.

Altcoins

Altcoins are cryptocurrencies that represent an alternative to the largest cryptocurrency Bitcoin. The largest Altcoins are for example Ethereum, Bitcoin Cash, Litecoin, Neo, Dent and IOTA. There are currently over 1,500 different Altcoins.

Blockchain

Is a list of records. The individual information is summarized in blocks. By chaining the individual blocks, data can no longer be changed in the past. Otherwise every block would have to be rewritten to the current one. In principle, a blockchain is a new kind of database where all information is linked together.

Bagholder

This refers to investors who have placed a large number of small cryptocurrencies that still have a very low value. As a result, they hope that at least a few of the coins multiply their value and they thereby make a profit.

Butthurt

Describes a sense of shame and disappointment. For example, someone can be Butthurt when his Altcoins have just fallen sharply or even become worthless.

Faucets

This refers to websites that give users a very small amount of Bitcoin or other Altcoins for the execution of an action. This can be, for example, for visiting a website or filling out a form.

EVM Code

Is the programming language written in the code on the Ethereum Blockchain.

DApps

Is the short form for decentralized applications. This means applications that do not run centrally on a server but decentralized on the blockchain. DApps are open source, so the code is visible to everyone and their applications are 100% transparent.

DAO

The abbreviation DAO stands for “Decentralized Autonomous Organization”. Behind it hides an organization that completely manages without guidance, but works only by predetermined rules. “The DAO” is a decentralized venture capital fund that existed as an open source project on the Ethereum Blockchain. He managed without a board or management. In May 2016, “The DAO” funded a crowdfunding campaign. However, there was a technical vulnerability that was eventually exploited by attackers to seize the previously paid up ethers. Eventually, in order to retrieve the lost ethers, a hard fork ensued, in which Ethereum shared in Ethereum and Ethereum Classic. At Ethereum, the credit from the hacker attack was not retrieved at Ethereum Classic. Ethereum today also has the much larger community than Ethereum Classic and also a higher market capitalization.

FOMO

Written out FOMO stands for “Fear of Missing Out”. It describes the fear of missing a connection when a price rises. Someone who is driven by FOMO would like to invest all his money in a certain cryptocurrency right away, as he believes the price will soon rise sharply.

FUD

Means “Fear, Uncertainty and Doubt”. As Fudster so people are referred to spread in forums fear and panic and thus bring the value of a cryptocurrency to fall.

FORK

This can be a hard fork or soft fork. A Hard Fork splits the Blockchain. From the time of Hard Fork arise two different chains (blockchains). These are identical until the time of the Hard Fork and only differ from then on. A soft fork is an update of the current fork, but no new blockchain splits off. A hard fork occurs whenever there is enough mining power for each of the two forks at the time of fork. Then both Forks can continue.

ICO

It is written for Initial Coin Offering. In an ICO, companies sell tokens for which they receive bitcoins, ethers or another cryptocurrency. The tokens give investors a pre-set equivalent, for example, 10% of the revenue can be distributed to all token holders. The design of the tokens is the responsibility of the issuing company. ICOs are mainly used by young companies to raise capital. They provide an alternative to traditional venture capital financing.

Genesis Block

So the first block in the blockchain is called. All transactions can be traced back to the Genesis block in the blockchain.

Hashrate

Denotes the number of arithmetic operations that are available for mining in the Bitcoin network, for example. A 100 TH / s hashrate means that the Bitcoin network can perform 100 trillion operations per second.

Mining

Means solving mathematical calculations, whereby new blocks are found. This process is also called proof of work. As an incentive, the miners get a certain number of bitcoins, ethers or whatever other crypto currency they are mincing for each new block. The blocks then write the transactions that have taken place since the last block find. This gives the miners also the transaction fees.

Hodl

The term was coined by a Reddit user. He came back drunk from a bar and complained that his friends had mocked that he had not sold his bitcoins at the last high and now has to live with the fall of the price. He then said that he will keep the bitcoins in any case until they rise again in price. In English, he wanted to write “hold”, as the title of his Reddit post, but since he was so drunk he wrote hodl. This term has since become synonymous with the long-term of coins.

51% Attack

If you manage to take on 51% of the computing power in a network, you can rewrite the blockchain as you like. So if someone manages to own 51% of the mining power at Bitcoin he would suddenly have the opportunity to control the blockchain. That’s why Hard Forks is always so crucial for which blockchain the miners decide. Because the blockchain with the majority of miners will become the stronger chain.

Scam Coins

Behind it are hidden coins that really should be worthless. Because their technology is not really outstanding and they bring the crypto world also no added value. Often they only have a good name that attracts a few investors. 

Whales

Whales are very financially strong investors in the crypto market. These can be, for example, very wealthy individuals or institutional investors. They have enough capital in their hands to move entire markets. At Bitcoin, this is getting more and more difficult as the cryptocurrency currently has a market capitalization of over $ 300 billion. But especially with smaller cryptocurrencies you often see “pump and dumbs”. Very much of the order book is bought up, which drives the price upwards. Very soon after the price has gone up, the whales then sell their coins again to other investors, who also want to benefit from the price increase, but only start very late.

Pump and Dump

Means the fast buying up of a cryptocurrency in order to push up the price in the short term. The goal is to get new investors into a specific currency. They invest because they do not want to miss the price increase and also want to profit from it. Once the price is high enough, the original investors behind the pump sell their coins back to investors who want to earn the share price rise, but only very late.

Proof of Stake

In this approach, based on the cryptocurrency of your own cryptocurrency, it is determined how many cryptocurrencies I can mine or how much I have a say in cryptocurrency decisions.

Proof of Work

Is the system what is currently used in mining Bitcoin and Ethereum. Using computing power, miners can mine new blocks and get new coins for each block found. The mining is done by solving mathematical equations. The more computing power I have, the more equations I can solve and the more coins I can get.

Private Key

This is a kind of password. With the private key, the owner gets access to his bitcoins on the blockchain and can transfer them.

Node

A node is any computer that connects to the blockchain. A full node is then a computer that enforces the rules of the blockchain.

Multi-Signature (multisig)

Multi-signature transactions require multiple keys to complete a transaction. The keys can be divided into several persons. This allows transactions to be performed only if all of them agree.

ASIC

When written out, ASIC means “Application Specific Integrated Circuit”. These are silicon chips that are designed to solve a particular computing option. ASIC chips are used by miners to mine Bitcoin. All they do is solve SHA256 hashing problems.

Masternode

First and foremost, a master node, like any other node, is a server within a remote network. Nodes are important because they can handle transactions and store the blockchain. However, a masternode is able to perform tasks that a normal node cannot:

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