Welcome to the Coincurrent Crypto Glossary. Here you will find a range of common keywords, fundamentals, technical terms and protocols that are heavily referenced within the crypto ecosystems.
General Crypto or Investment Terminologies
Airdrop
"Airdrop" is a term often used in crypto to describe when new coins suddenly appear in your crypto wallet. Blockchain being an open ledger, means that it is possible at any point in time to see all the activity that an address has undertaken, or all the coins that currently reside within it, using a tool called a blockchain explorer (such as etherscan.io for Ethereum addresses). Projects can therefore take a snapshot of all users that satisfy their criteria and simply send coins to them.
All-Time-High (ATH)
"All-Time High" (ATH) refers to the highest price (or market cap) that an asset has reached since its listing or inception. As the price used to define the "all-time high" is the last done, it just refers to the highest price a trader paid for an asset, regardless of how much he bought of the asset.
All Time Low (ATL)
The lowest point (in price, in market capitalisation) that a cryptocurrency has been in its history, since its listing or inception.
Altcoin
Altcoin is used to describe any cryptocurrency that is not Bitcoin — an alternative digital currency. As Bitcoin was the original cryptocurrency, any cryptocurrency that was created after was treated as an "alternative" to Bitcoin's network and its use cases.
Blockchain
The blockchain is a unique digitised way of record keeping, delivered using distributed ledger technology that is unable to be tampered with. In essence, the blockchain, such as Bitcoin, does not require an intermediary and is programmed to provide "sequential blocks" that build upon one another which in turn creates an unchangeable ledger of transactions.
Coin
A Crypto Coin is a specific project that has a "digital store of value" or also a digital asset. An example of this is Bitcoin, also a blockchain, but a digital store of value that is also known as a token.
Did you know that within the Crypto ecosystem there are upwards of 10,000 "coins" or "projects".
Decentralised Autonomous Organisation (DAO)
A DAO is a type of structure that composed to essentially decentralise a project. Instead of being a business run by a CEO and governed by a board of directors, it is collectively owned and managed by its members. Decisions are made by proposals that anyone can submit and voted on to ensure everyone in the organisation has a voice. Typically a token is issued and represents a vote per token. These organisation usually have treasuries that no one has the authority to access without the approval of the group and voting is often focussed on how to spend the treasury and what direction future developments should focus on.
Decentralised Apps (Dapps)
Dapps are applications that run on a decentralised network, avoiding a single point of failure.
DApps are any computer applications whose operation is maintained by a distributed network of computer-nodes, as opposed to a single server.
Distributed Ledger Technology (DLT)
Distributed ledger technology (DLT) allows for the digital record keeping across multiple computers (or nodes) concurrently while doing this in a decentralised manner. The DLT process goes through a level of verification, approval and "consensus" before storing the data permanently on the ledger creating a level of transparency.
Dollar Cost Averaging (DCA)
Dollar-cost averaging is a tool an investor can use to build savings and wealth over a long period and in Cryptocurrency it is known as a valuable tool, due to the markets volatility and as we all know timing the market means you may have to keep an eye on it 24/7.
The concept behind Dollar Cost Averaging (DCA) is simple with the key advantage the ability to reduce the effects of emotional buying and market timing to enter trades. By harnessing a dollar-cost averaging strategy, investors seek to reduce the risk of making poor decisions and ultimately distribute their income or wealth in a more circumspect model. This may include buying more when Crypto asset prices are lower. A real positive is that dollar-cost averaging, much like Superannuation, forces you to allocate money during a set timeframe and therefore the approach ends up being a habit.
Note: We still feel it's important to review price when entering into DCA positions. This is simply due to the Crypto market volatility. i.e. In some instances, if an asset has "pumped 100%" it would be prudent to wait before entering into a trade or consider another Crypto asset to invest in.
FOMO
Fear of missing out or FOMO is based off a potential regret that you may miss out on an opportunity that someone may have recommended or "shilled". When a cryptocurrency coin sky rockets often people "tag along" and join the trade, not really understanding the fundamentals or technical analysis for fear they will not follow the herd and secure high profits, therefore "missing out".
This is a very emotional approach to trading, and typically high risk and often done by Crypto novice's who are after a quick buck, but often end up losing due to their emotional decisions.
FUD
Fear, uncertainty, and doubt or FUD is quite regular occurrence in Cryptocurrency and relates to negative publicity related to Cryptocurrency as a market or associated Crypto projects which involve false or misleading information. This is often an "online strategy" used to convince the general public that an event will impact the price negatively, and this naturally hits the market in a big way for a short period therefore creating a buying opportunity, which is often the intend purpose.
This type of publicity influencing perception and if done correctly, via multiple sources spreads like wild fire and has a direct correlation to the market often in a negative way creating fear and doubt so investors or traders "sell" their investment for fear of losing it all based on the news event.
HODL
Stands for "Hold on for Dear Life". A type of passive investment strategy where individuals hold an investment for a long period of time, regardless of any changes in the price or markets.
Moon
A situation where there is a continuous upward movement in the price of a cryptocurrency. This is often expressed by 'retail' traders via social channels such as Twitter and Facebook and can help measures the level of 'greed' and 'euphoria' that is present in the market.
Proof-of-Work (PoW)
A blockchain consensus mechanism involving solving of computationally intensive puzzles to validate transactions and create new blocks.
In contrast to fiat currencies (such as AUD, USD and GBP) which is typically regulated by a central authority such as a central bank, cryptocurrencies are decentralised.
PoW paves the way for many cryptocurrencies including Bitcoin and Ethereum to work without the involvement of a government or company.
This consensus mechanism is crucial to avoiding double spending — ensuring that a coin or token isn't used more than once to facilitate a transaction.
Proof-of-Stake (PoS)
A blockchain consensus mechanism in addition to Proof-of-Work that maintains the integrity of blockchain. PoS is another consensus mechanism, the method by which blockchain confirms transactions and prevents the problem of double counting.
Double counting occurs when the same coin or token is used for more than one transaction.
While Proof-of-Work is used for Bitcoin transactions, PoS was created to work as a powerful alternative. Many researchers believe PoS is significantly more energy efficient compared to PoW and more secure, although some critics question the integrity of these claims.
Token
A crypto token is a virtual currency token or a denomination of a cryptocurrency. It represents a tradable asset or utility that resides on its own blockchain and allows the holder to use it for investment or economic purposes.
Technical Terminologies
Bullish
A person that is optimistic and confident that the market price of a digital asset will increase, this person is also known to be "bullish" about the market or price.
For example, a person might say "I'm bullish on Bitcoin and expect it to increase to $70,000 by the end of the year"
Bearish
A person who believes that prices in a given market will decline over an extended period. Such a person might be referred to as “bearish.”
For example, a person might say "I'm bearish on Bitcoin and expect it to decrease to $25,000 by the end of the year"
Trending
Describes the price of a cryptocurrency to be following a steady or linear trend (depending on the timeframe). The trend could be either upwards (i.e. bullish), downwards (i.e. bearish) or sideways (consolidating).
Market Structure
Market Structure refers to analysing the trend of a given digital asset. We can identify "bullish" market structure as the market moves upwards - i.e. making higher high's and higher low's. We can identify "bearish" market structure as the market moves downwards - i.e. making lower high's and lower low's.
Support (Demand Zones)
A price region where there has been a historical amount of buy orders (buying pressure) that hold price above a specific price level, indicating that the price of a digital currency is unlikely to break below this level and has the potential to reverse to the upside.
Resistance (Supply Zones)
A price region where there has been a historical amount of sell orders (selling pressure) that hold price below a specific price level, indicating that the price of a digital currency is unlikely to break above and has the potential to reverse to the downside.
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