A 51% attack is a situation where more than half of the computers in a network running cryptocurrency software are controlled by one person or one group of people. This allows that person or group to manipulate the cryptocurrency. They could stop everything, manipulating transactions and have virtually unlimited money because they can spend the same money again and again. The mining pool ghash.io briefly exceeding 50% of the bitcoin network's computing power in July 2014, leading the pool to voluntarily commit to reducing its share of the network. It said in a statement that it would not reach 40% of the total mining power in the future.
Altcoin is short for “alternative bitcoin” and “alternative coin”, it is any cryptocurrency except for bitcoin. At the end of 2017, there were over 1,000 altcoins with many more planned for release
All or none (AON)
AON is a directive used on a buy or sell order that instructs the exchange to fill the order completely or not at all. If there are too few assets available to fill the order entirely, the order is negated when the market closes. An AON order is considered a duration order because the investor gives instructions regarding how the order has to be filled, which affects how long the order remains active.
ATH is an acronym used with respect to brokerage accounts, financial data, stock trading and cryptocurrency when an asset has reached its highest value ever recorded.
AML is a framework consisting of legal and regulatory procedures to minimize and curb the flow of funds that are generated from illegal or dubious activities.
Application Programming Interface
API is a set of subroutine definitions, communication protocols, and tools for building software. In general terms, it is a set of clearly defined methods of communication among various components. A good API makes it easier to develop a computer program by providing all the building blocks, which are then put together by the programmer. An API may be for a web-based system, operating system, database system, computer hardware, or software library. An API specification can take many forms, but often includes specifications for routines, data structures, object classes, variables, or remote calls. POSIX, Windows API, and ASPI are examples of different forms of APIs. Documentation for the API usually is provided to facilitate usage and implementation.
Arbitrage is trading with profit by exploiting the price differences of different cryptocurrencies exchanges. Arbitrage occurs when some assets are purchased and simultaneously sold in another market at a higher price. It is a mechanism that ensures prices do not deviate too much from fair value. Arbitrage is a necessary force in the financial marketplace as it keeps an eye on the value, but nowadays extremely difficult to profit as pricing setups are changed quickly in a matter of seconds.
ASIC mining or Application Specific Integrated Circuit mining is a method of mining various coins at a much faster rate than any normal desktop or laptop allows. Essentially it is a chip specifically designed to do one task. An example of one such model is SHA-256, which has been specifically designed by the Bitcoin blockchain to mine new coins. There are also ASIC’s for a script that specifically solves the mathematical code in relation to altcoins such as Litecoin.
That refers to the balance between growth- and income-oriented investments in a portfolio. This allows the investor to take advantage of the risk/reward trade-off and benefit from both growth and income. Here are the basic steps to asset allocation:
- Choosing which asset classes to include (cryptocurrencies, stocks, bonds, money market, real estate, precious metals, etc.)
- Selecting the ideal percentage (the target) to allocate to each asset class
- Identifying an acceptable range within that target
- Diversifying within each asset class
An atomic swap is a cryptocurrency trade executed instantly without the need of a third party to execute the trade. It is an attempt to make faster and more secure transactions and more transparent. It is a method by which you can trade coins cross-chain directly without going through an exchange. When two individuals perform an atomic swap they sign a multi-signature contract that holds both traders accountable for a swap to be put through. Hashlock uses a cryptographic algorithm that allows users to access funds once both parties have signed off their transactions a time clock of the transaction is detected as insurance that both traders will get their funds back if the transaction is not executed in under a specific time frame.
Is the total sum of the vulnerabilities in a given computing device or network that are accessible to a hacker. Anyone trying to break into a system generally starts by scanning the target’s attack surface for possible attack vectors, whether for an active attack or passive attack, ethical hacking or a hacking competition.
Attack surfaces can be divided into a few categories:
- The network attack surface.
- The software attack surface.
- The physical attack surface.
Every point of network interaction is a potential part of the network attack surface. A network attack surface can be reduced by closing unnecessarily open ports and limiting the resources that are available to untrusted users and to the Internet in general.
Business to Business
B2B is a model that focuses on selling products and services to other companies. A good example of a traditional B2B market is automobile manufacturing. The tires, hoses, batteries, and electronics essential to the final product – the vehicle – are often manufactured by separate companies, and then sold directly to the automobile manufacturer.
Business to Customer
B2C refers to the transactions conducted directly between a company and consumers who are the end-users of its products or services. The business to consumer as a business model differs significantly from the business-to-business model, which refers to commerce between two or more businesses.
Business to business to consumer
B2B2C is an e-commerce model that combines business to business (B2B) and business to consumer (B2C) for a complete product or service transaction. B2B2C is a collaboration process that, in theory, creates mutually beneficial service and product delivery channels.
It is a term that describes an investor who holds a position in an asset that decreased in value until it is worthless. The bag holder will hold its position even in a big downtrend which most of the time will result in a loss of asset share. If for example, someone would hold his Bitconnect coins even though it was evident that it is a scam. He would be a perfect example of a bag holder.
Bears and Bulls
In trading, there are two distinct types of mindsets while trading–the Bears (sellers) and the Bulls (buyers).
To put it plainly, Bears think things are going to get worse (i.e. bearish) and therefore enter the market with a sell. After entering a bearish position in the market, you’re what is called "short". Price movement from this point up or down will change a bear’s account value in increments of the chosen market.
Where Bears believe prices are going down, Bulls are the opposite–they think the prices are going up (bullish), and therefore enter the market with a buy. After entering a bullish position in the market, naturally, you are what is called "long". Once again, price movement from this point up or down will change a bull’s account value in increments of the chosen market.
Is a technique played by a group of traders, aimed at manipulating the price of a cryptocurrency. The bear trap is set by selling a large amount of the same cryptocurrency at the same time, fooling the market into thinking there is an upcoming price decline. In response, other traders sell their assets, further driving the price down. Those who set the trap then release it, buying back their assets at a lower price. The price then rebounds, allowing them to make a profit.
Is the percentage of the total cryptocurrency market capitalization that Bitcoin takes up at any given point in time
Bit, Wei and Satoshi
A bit is the smallest unit of digital, computerized information represented as either a 0 or 1. But bit also refers to a very small amount of bitcoin, specifically, one-millionth of a bitcoin or 0.00000100 bitcoin.
Wei is the smallest amount of Ethereum coin. One Ethereum coin is worth 1 quintillion (1,000,000,000,000,000,000) wei.
Satoshi is the smallest sub-unit of a Bitcoin currently available (0.00000001 BTC).
Is a transaction data is permanently recorded in files called blocks. They can be thought of as the individual pages of a city recorder's record book (where changes to title to real estate are recorded) or a stock transaction ledger. Blocks are organized into a linear sequence over time (also known as the blockchain).
It is an online tool to view all transactions that have taken place on the blockchain, network hash rate, and transaction growth, among other useful information.
This refers to a number of blocks preceding the genesis block, which is the first block on the chain. A genesis block will always have a height of zero. It’s a metric used to create a bearing on time in the programming world as well as a few other functions such as maintaining counter-party and betting in the crypto world. Considering that a new Bitcoin block is made every 10 minutes, you can work out certain time-related pieces of information if you have the total length of the chain.
It is a situation where a large limit order has been placed to buy when a cryptocurrency reaches a certain value. This can sometimes be used by traders to create a certain impression in the market, preventing a cryptocurrency from falling below that value, as demand will likely outstrip supply when the order is executed.
Byzantine Generals’ Problem [BGP]
Byzantine Generals’ Problem describes a situation where spread out units need to coordinate their behaviour or action but cannot trust each other to get organized. Byzantine Generals’ Problem is a made-up, historical situation where multiple generals and their individual armies have surrounded a city to attack it. The majority of the generals must somehow coordinate a decision to either attack or retreat at the same time, otherwise, the situation will end in a major failure. The main problem of preventing coordinated action is low trust. Reasons for low trust may include:
- The generals are far enough apart that they cannot communicate directly or even see each other, so they must trust their messengers to deliver messages.
- One or more generals may be a traitor and could send false messages to the other generals.
- One or more messengers may be a traitor and could send false messages to the other generals.
- The enemy city may catch a messenger and send false messages.
This Byzantine Generals Problem is commonly brought up when talking about cryptocurrencies. The digital record, known as the blockchain, must verify and record identical information simultaneously across many thousands of computers and none of the computers can be trusted as a reliable source.
Bitcoin provided a unique solution to this problem known as mining.
Refers to a temporary block created by mining nodes using transactions from the memory pool. Each mining node tries to add this candidate block to the blockchain.
It is a type of price chart that displays the high, low, open and closing prices of a security for a specific period. It originated from Japanese rice merchants and traders to track market prices and daily momentum hundreds of years before becoming popularized in the United States. The wide part of the candlestick is called the "real body" and tells investors whether the closing price was higher or lower than the opening price.
It is a ledger maintained by a centralized agency (such as a bank) that records all financial transactions.
Usually referring to the storage of keys, in relation to wallets or exchanges, a custodial set-up is one in which private keys are being held by the service provider while they provide a login account.
Dead Cat Bounce
It is a temporary recovery from a long decline or a bear market, followed by an even bigger downtrend. The name itself "dead cat bounce" is based on an assumption that even a dead cat will bounce if it falls from the very top floor of the building. It is a price prediction, or a pattern used by technical analysts to determine the downtrend, it is when the price is falling but then for a short period of time it jumps a little bit back up, but then falls back down again. After the price drops even below the prior low that is called a "Dead Cat Bounce" Calling a Dead Cat Bounce ahead of time is extremely difficult even for hardcore traders.
It is a digital representation and storage of personal information such as name, address, social security number, and more; on the blockchain, digital identity can be decentralized and used for identity verification in a secure manner.
It is a collective agreement by various computers in a network enabling it to work in a decentralized manner without a central authority.
Distributed Denial of Service (DDoS) Attack
Is an attack in which multiple compromised computer systems attack a target, such as a server, website or other network resources, and cause a denial of service for users of the targeted resource. The flood of incoming messages, connection requests or malformed packets to the target system forces it to slow down or even crash and shut down, thereby denying service to legitimate users or systems.
Refers to transactions for minuscule amounts of cryptocurrency. A transaction is considered “dust” when the value is lower than the cost of spending it. Dust transactions are uneconomic and considered “spammy” to the network.
"Do your own research" Because cryptocurrencies are highly speculative, so a potential buyer should be prepared to lose some of the funds, crypto fortune predictors often use this word as a call for rather do your own research than to blame it all on mine.
ERC - 20
ERC-20 - A type of token standard for Ethereum. This allows the tokens to be easily exchangeable and able to work immediately with decentralized applications that also use the ERC-20 standard. Most tokens released through ICOs are compliant with the ERC-20 standard.
It is a token standard for non-fungible Ethereum tokens. An Ethereum Improvement Proposal introduced in 2017, it enables smart contracts to operate as tradeable tokens similar to ERC-20 tokens.
Refers to a cryptocurrency reward system usually on a website or app, that rewards users for completing certain tasks. It is mostly a technique used when first launching an altcoin to interest people in the coin.
It is “legal tender” backed by a central government, such as the Federal Reserve, and with its own banking system, such as fractional reserve banking. It can take the form of physical cash, or it can be represented electronically, such as with bank credit.
It is also known as “pegged cryptocurrency”, it is a coin, token, or asset issued on a blockchain that is linked to a government- or bank-issued currency. Each pegged cryptocurrency is guaranteed to have a specific cash value in reserves at all times.
In cryptocurrencies, a fork is defined variously as:
- what happens when a blockchain diverges into two potential paths forward
- a change in protocol
- a situation that occurs when two or more blocks have the same block height
Forks are related to the fact that different parties need to use common rules to maintain the history of the blockchain. Forks (in the sense of protocol changes) have been used to add new features to a blockchain, to reverse the effects of hacking or catastrophic bugs on a blockchain. Notably, blockchain forks have been widely discussed in the context of the bitcoin scalability problem.
Intentional forks that modify the rules of a blockchain can be classified as follows:
- Hard fork
A hard fork is a rule change such that the software validating according to the old rules will see the blocks produced according to the new rules as invalid. In case of a hard fork, all nodes meant to work in accordance with the new rules need to upgrade their software.
- Soft fork
In contrast to a hard fork, a soft fork is a change of rules that creates blocks recognized as valid by the old software, i.e. it is backwards-compatible. As for a hard fork, a soft fork can also split the blockchain when non-upgraded software creates blocks not considered valid by the new rules.
Fear, Uncertainty, and Doubt (often spread on social media or mass media). FUD can cause the price of a coin to drop, not based on fundamentals or charts, but based on the bad news that spreads around social media. Many times, the bad news isn’t substantiated or grounded in reality and instead ends up being something silly like a popular talking head’s opinion that Bitcoin is a bubble. The fear, uncertainty, and doubt-inducing idea being spread around media can be referred to as FUD.
Fungible is a positive quality where two or more of the same thing have identical value. That is to say, one of a group of things can be a substitute for another and it won’t change the value.
For example, your $20 bill is worth the same to you as any other $20 bill. On the other hand, my car doesn’t have the same value as your car and so it is not an easy substitute and is non-fungible.
Some cryptocurrencies like bitcoin don’t have fungible coins. That can be a problem when these coins are used for illegal transactions because with enough research, some of the coins can be linked to that illegal activity. Coins with that bad mark are not desirable and so they are non-fungible.
It is a term used on the Ethereum platform that refers to a unit of measuring the computational effort of conducting transactions or smart contracts or launch dApps in the Ethereum network. It is the “fuel” of the Ethereum network.
Gas limit and Gas price
Gas limit - A term used in the Ethereum platform that refers to the maximum amount of units of gas the user is willing to spend on a transaction. The transaction must have enough gas to cover the computational resources needed to execute the code. All unused gas is refunded at the end of the transaction.
Gas price - A term used in the Ethereum platform that refers to the price you are willing to pay for a transaction. Setting a higher gas price will make miners more incentivized to prioritize and validate that particular transaction ahead of those set with a lower gas price. Gas prices are typically denominated in Gwei.
It is the key to a blockchain's security. A bit of cryptographic math that makes the links between blocks virtually unbreakable.
A hash function takes the information in each block and uses it to create the hash—a unique string of characters.
The hash from one block is added to the data in the next block. So, when the next block goes through the hash function, a trace of it is woven into the new hash. And so on, throughout the chain.
If there's an attempt to alter a previously created block, the hash that's encoded in the next block won't match up anymore. This mismatch will continue through all subsequent blocks denoting an alteration in the chain. When the hashes match up across the chain, all parties know that they can trust their records.
Firm or a person (broker, consultant, banks), are the ones who act as a mediator between parties of a business deal, investment decisions, negotiations... In the money world, banks act as an intermediary or the middleman, between the depositors seeking an interest income and borrowers who seek capital.
Know your customer (alternatively know your client) is the process of a business verifying the identity of its clients and assessing potential risks of illegal intentions for the business relationship. The term is also used to refer to the bank regulations and anti-money laundering regulations which govern these activities. Know your customer processes are also employed by companies of all sizes for the purpose of ensuring their proposed agents, consultants, or distributors are anti-bribery compliant.
The Lightning Network is a "second layer" payment protocol that operates on top of a blockchain. Theoretically, it will enable fast, scalable transactions between and across participating nodes, and has been touted as a solution to the Bitcoin scalability problem.
A ledger is a database of where every transaction of cryptocurrency is recorded. Blockchain is a ledger for Bitcoin transactions, meaning that every transaction that ever happened is recorded. Let us say you and your friends are playing bets with each other but no one really has any money. But you still record the score. Cristian puts a bet on his team that will allegedly win the championship, but Roger placed a bet on a basketball game. A ledger in their case would be a bookie. Someone who tracks that transactions the bets and the revenue returns, keeps a track on how much money was put in and how much of it was put out or transacted to some other address.
An independent blockchain running its own network with its own technology and protocol. It is a live blockchain where its own cryptocurrencies or tokens are in use, as compared to a testnet or projects running on top of other popular networks such as Ethereum.
A purchase or sale of a cryptocurrency on an exchange at the current best available price. Market orders are filled as buyers and sellers are willing to trade. This is in contrast with limit orders at which a cryptocurrency is sold only at a specified price.
Trading on margin means we are trading with borrowed money. On some exchanges, we can trade Bitcoin with a handful of coins (there are fewer coins offered for margin trading) with 2.5x leverage. So, let us say we have 0.1BTC, we can borrow up to 0.25BTC to trade with. But to be clear, you do not own this 0.25BTC. Like any other loan, this borrowed Bitcoin must be paid back with interest. On losses, you will need to pay back the loss and the interest. So, let’s take our hypothetical 1 BTC from before and take a short position on Ethereum. We can borrow 2.5 BTC worth of ETH and sell it. 30 minutes later, the price of ETH has plummeted 10%. Now we can close our short position, buying back 2.5 BTC worth of ETH; except now, since the price has dropped, we are buying more ETH than what we sold. You pay back the borrowed coin and take the rest as profit.
Are full nodes that incentivize node operators to perform the core consensus functions of running a blockchain. The increasing cost and technical complexities involved in running a full node computer on a blockchain network often lead to a decline in the number of full nodes, as it's not very profitable.
Mining pools usually take up most of the resources through their mining activities. This reduction in full nodes impacts the efficient working of a blockchain, as it may lead to longer transaction processing times and network congestion.
Master nodes attempt to solve the problem by acting as full nodes, and their operators are financially rewarded, similar to miners in a proof-of-work system. They operate on a collateral-based system to ensure that they provide genuine services as a backbone to the blockchain network, and hence are also known as “bonded validator systems.”
Dash, a fork of Bitcoin, was the first virtual currency to adopt the master node model.
A hash tree or Merkle tree is a stored data, transferred between computers, they help ensure that data blocks receive other peers in a peer-to-peer network are transmitted and undamaged, they even check that the other peers do not send fake blocks. In the top of a hash tree, there is a top hash or master hash. The top hash is from a trusted source.
It is similar to gold mining, extracting new coins from the Bitcoins existing protocol. Only miners use a special software program to solve math problems. Mining is an important process that ensures fairness while keeping the network stable and secure. The bitcoin protocol estimates that 21 million Bitcoins will exist at some point. Miners bring those new Bitcoins to light. Miners get rewarded for creating blocks of validated transactions.
It is a computer system, meant for mining coins, or on the other hand, as it has a lot of processing power and advanced graphics cards it can also be used for gaming if it is a double purpose rig. The first mining software was very basic and allowed individuals with the most computing power to obtain new Coins in the early adoption only Bitcoins. But Bitcoin grew on popularity so did the desire for competitive computer power.
Moving average convergence divergence (MACD)
Refers to a trend-following momentum indicator that shows the relationship between two moving averages of prices. The MACD is calculated by subtracting the 26-day exponential moving average (EMA) from the 12-day EMA. A nine-day EMA of the MACD, called the "signal line", is then plotted on top of the MACD, functioning as a trigger for buy and sell signals.
It is also called a multi-signature and it refers to having more than one signature to approve a transaction. This is beneficial if a company is making a transaction and they do not want a single employee to have sole access to this transaction. Multisig allows for a transaction to be approved by at least two different employees.
A node is an intersection point of connection within a network. In an environment where all devices are accessible through the network and are considered nodes. They are some major centres through which traffic is routed. It is a program that validates transactions and blocks. They help the network by accepting transactions of blocks, from other full nodes. If an insufficient number of nodes perform this function, clients won't be able to connect through the P2P network.
An agent that finds and verifies information, bridging the real world and the blockchain by providing data to smart contracts for execution of said contracts under specified conditions.
Are those blocks that have not been accepted in the blockchain due to a time lag in the acceptance of the block in question into the blockchain as compared to the other qualifying blocks. They are valid and verified blocks that have been rejected. They can also be called detached blocks as they exist in isolation from the blockchain.
Over-The-Counter - OTC
Over-the-counter (OTC) is a security traded in some context other than on a formal exchange, often peer-to-peer through private trades. In jurisdictions where exchanges are disallowed or where amounts traded will move the markets, traders will go through the OTC route.
Peer to peer (P2P)
P2P is an expression that is used in the Crypto world and it means Peer-to-Peer. Almost all interactions on blockchain can be managed by Peer-to-Peer without the need of third parties such as Banks or others.
Proof of Work (PoW)
In proof of work (PoW) based public blockchains (e.g. Bitcoin and the current implementation of Ethereum), the algorithm rewards participants who solve cryptographic puzzles in order to validate transactions and create new blocks (i.e. mining).
Proof of work is a protocol that has the main goal of deterring cyber-attacks such as a distributed denial-of-service attack (DDoS) which has the purpose of exhausting the resources of a computer system by sending multiple fake requests. The Proof of work concept existed even before bitcoin, but Satoshi Nakamoto applied this technique to his digital currency revolutionizing the way traditional transactions are set. Proof of work is maybe the biggest idea behind Nakamoto’s Bitcoin white paper – published back in 2008 – because it allows trustless and distributed consensus. A trustless and distributed consensus system means that if you want to send and/or receive money from someone you don’t need to trust in third-party services. When you use traditional methods of payment, you need to trust in a third party to set your transaction (e.g. Visa, Mastercard, PayPal, banks). They keep their own private register which stores the history of transactions and balances of each account. With bitcoin and a few other digital currencies, everyone has a copy of the ledger (blockchain), so no one has to trust in third parties because anyone can directly verify the information written.
Going deeper, proof of work is a requirement to define an expensive computer calculation, also called mining, that needs to be performed to create a new group of trustless transactions (the so-called block) on a distributed ledger called blockchain. Mining has two purposes. The first is to verify the legitimacy of a transaction or avoiding the so-called double-spending. The second is to create new digital currencies by rewarding miners for performing the previous task.
What actually happens when you set a transaction. Transactions are bundled together into what we call a block. Miners verify that transactions within each block are legitimate. To do so, miners should solve a mathematical puzzle known as the proof-of-work problem. A reward is given to the first miner who solves each block's problem. Verified transactions are stored in the public blockchain.
In a distributed consensus-based on the proof of Work, miners require a lot of energy. One Bitcoin transaction may consume as much electricity as a major European country in 2020.
Proof of stake (PoS)
In PoS-based public blockchains (e.g. Ethereum's upcoming Casper implementation), a set of validators take turns proposing and voting on the next block, and the weight of each validator's vote depends on the size of its deposit (i.e. stake). Significant advantages of PoS include security, reduced risk of centralization, and energy efficiency.
Proof of stake is a different way to validate transactions based and achieve the distributed consensus.
It is still an algorithm, and the purpose is the same as the proof of work, but the process to reach the goal is quite different. Unlike the PoW, where the algorithm rewards miners who solve mathematical problems with the goal of validating transactions and creating new blocks, with the proof of stake, the creator of a new block is chosen in a deterministic way, depending on its wealth, also defined as stake. All the digital currencies are previously created in the beginning, and their number never changes. This is why in this PoS system miners are called forgers, instead.
Also, rewards for the creation of a new block are different: with Proof-of-Work, the miner may potentially own none of the digital currency he/she is mining. In Proof-of-Stake, forgers are always those who own the coins minted.
PoS is also a greener and cheaper distributed form of consensus. Thanks to a PoS system validators do not have to use their computing power because the only factors that influence their chances are the total number of their own coins and the current complexity of the network.
So, the main problem is: is proof of stake safer than the proof of work? Experts are worried about it, and there are several sceptics in the community. Using a Proof-of-Work system, bad actors are cut out thanks to technological and economic disincentives. In fact, programming an attack to a PoW network is very expensive, and you would need more money than you can be able to steal. Instead, the underlying PoS algorithm must be as bulletproof as possible because, especially without penalties, a proof of stake based network could be cheaper to attack.
To solve this issue, the creator of Ethereum, Vitalik Buterin, created the Casper protocol designing an algorithm to follow certain rules under which a bad validator might lose its whole deposit in an attempt of creating an invalid block: “Economic finality is accomplished in Casper by requiring validators to submit deposits to participate and taking away their deposits if the protocol determines that they acted in some way that violates some set of rules (‘slashing conditions’).” Slashing conditions refer to the circumstances above or laws that a user is not supposed to break.
Public and Private Key
Everyone trading with cryptocurrencies is given two keys that are both codes made of up to 50 alphanumerical characters that make it hard for hackers to hack.
A private key is a specially coded key that is given to an individual and is meant to be a personal identification for transferring the funds to your designed place, therefore everyone is given their own key and it serves as authentication for transfers and prevents you getting incorrect transfers to your address. If Crypto transfers are a high road, a private key is like navigation for the cars. It takes them to the right place but will not let the car into the garage if he/she does not have the right keys to open the garage (keys, in this case, are private keys).
If a key is lost, access to the wallet would not be possible anymore. That is why people store keys in special USB keys or move them to cold storage. Some even print the keys and hide them in two different places, if. for example, one burns down, the other one is still safe. It really is important to stress, that if you lose a private key you will be unable to access your founds.
The public key is a large numerical value, used to encrypt data. It is publicly known and accessible. The public key is used to encrypt, and the private key is used to decrypt.
Quick Response (QR) Code
A QR Code is a type of bar-code that can be read by a digital device and which stores information. A quick response code, also called a QR code, is most frequently used to track information about products, it is also regularly used in marketing and advertising campaigns. QR codes consist of black squares arranged in a grid (matrix) on a white background. QR code readers can extract data from the patterns that are present in the QR code matrix.
Return on Investment (ROI)
ROI is a performance measure, used to evaluate the efficiency of an investment or compare the efficiency of a number of different investments. ROI measures the amount of return on an investment, relative to the investment’s cost. To calculate ROI, the benefit (or return) of an investment is divided by the cost of the investment. The result is expressed as a percentage or a ratio.
Relative Strength Index (RSI)
A form of technical analysis that serves as a momentum oscillator, measuring the speed and change of price movements, developed by J. Welles Wilder. It oscillates between zero and 100, where a cryptocurrency is considered overbought when the indicator is above 70 and oversold when it is below 30.
Security tokens constitute an investment contract, where the main use of buying these tokens is the anticipation of future profits in the form of dividends. These are the tokens that are fully compliant with regulations. There is less chance of a hacking attack. They will be recognized as legal security under the federal law, a share of revenue that acts as an electronic key to access something. The following year will be a testing ground for security tokens if it proves out, as many envisioned, it will put a significant mark on all funds market.
Securities and Exchange Commission (SEC)
An independent agency of the United States federal government, responsible for enforcing federal securities laws, proposing securities rules, and regulating the securities industry, the nation's stock and options exchanges, and other related activities and organizations.
SegWit (Segregated Witness)
It is a process that increases the block's size in a blockchain by removing signature data from Bitcoin transactions. When certain parts of a transaction are removed, that frees up space for other transactions.
Segregate means to separate, and Witnesses are the transaction signatures. Hence, Segregated Witness, in short, means to separate transaction signatures.
We know that the Bitcoin blockchain consists of nodes, which are multiple systems distributed across the peer-to-peer network. They serve as administrators to Bitcoin transactions. Every transaction that is made in Bitcoin gets duplicated across the nodes which makes it virtually impossible to hack into or corrupt it.
The transaction data consists of two components. Those are inputs and outputs. There could be any number of inputs and outputs involved in the transaction. The input is the public address of the sender while the output is the public address of the recipient. The biggest component of the transaction is the signature. The signature is the part of the input, that verifies that the sender has enough funds to make the payment. Once each of the nodes has verified the transaction as valid, the transaction is included in a block which is added to the chain or the general ledger for public access.
Now, the main problem that the Bitcoin platform is facing is that more and more transactions are being concluded, which means that more blocks need to be added to the chain. Blocks are generated every 10 min and are a maximum of 1 MB big. Due to this problem, only a finite number of transactions can be added to a block. Which means that the number of the transactions is weighing down the blocks and that is causing delays in processing and verifying transactions.
So, Dr. Pieter Wuille suggested that to solve this problem the digital signature needs to be segregated from the transaction data. This process is called Segregated Witness or SegWit. The digital signature is 65% of the space given to the transaction. SegWit attempts to ignore the data attached to a signature by stripping off the signature from within the input and moving it to a structure towards the end of a transaction. This would increase the 1 MB limit for block sizes to a little under 4 MB. In addition to slightly increasing the capacity size of the blocks, SegWit also solves the problem where a receiver could intercept and modify the sender’s transaction ID in a bid to get more coins from the sender.
A situation where a large limit order has been placed to sell when a cryptocurrency reaches a certain value. This can sometimes be used by traders to create a certain impression in the market, preventing a cryptocurrency from rising above that value, as supply will likely outstrip demand when the order is executed.
When a coin is promising to solve world hunger and cure cancer, it’s being shilled. A shill attempts to spread buzz by personally endorsing the product in public forums with the pretence of sincerity, but in fact, he is being paid for his services. When someone does this (shilling) in other financial markets it is considered illegal due to the possibility of fraud, but it must be proven. If shilling only serves to generate buzz it may be legal in some cases. But in general, a lot of shilling can be seen in crypto space as more and more coins are emerging.
Pumping is practically the same as shilling only that pumping is most of the time used with a dump word. Pump and dump is false advertising of some assets to gain in volume and in price, at the same time as the price swing takes place, the biggest coin owners of pumped coins/falsely advertised coins will dump their coins in order to gain higher returns.
A blockchain ledger that runs in parallel to a primary blockchain, where there is a two-way link between the primary chain and the side chain. This allows the side chain to operate independently of the primary blockchain, using their own protocols or ledger mechanisms.
Was an online black market, operated as a TOR (The Onion Router) hidden service. Online users were able to browse it anonymously, without traffic monitoring. It encrypts the user's information in the application layer like the layers of an onion. Silk Road was the first modern black market, best known as a platform for selling drugs and semi-legal items. It was founded in February 2011 under a pseudonym name of "Dread Pirate Roberts." Ross Ulbrich was alleged by FBI to be the founder and owner of Silk Road, he was sentenced to life without the chance of parole. Based on the data from 2012 an estimated $15 million transactions were made annually on Silk Road, but some suggest that the number could be three times higher. Buyers and sellers conducted all transactions with bitcoins (BTC).
A smart contract is a piece of computer code that describes a transaction step by step. It can connect to multiple blockchains, tracking multiple assets, so it can swap those assets as needed to execute the transaction. It is an obligatory bind that two or more people are willing to consider under pre-established conditions. It is a way of transferring values, without the middleman. Once a contract is signed it is binding and enforces automatic obligations once it is set in motion. Like traditional contracts, where two people go to the lawyers and sign a pact or a deal, the lawyers, as the third participant, authenticate the paper and make it official. It is the same with smart contracts, only you do not need a lawyer for authentication.
Support and Resistance
Support and Resistance are one of the most discussed attributes of technical analysis. They are parts of analysing chart patterns, these terms are used to refer to price levels on charts that tend to act as obstacles, preventing the price to get pushed in a specific direction. The concept itself looks relatively easy to master but bear in mind that it is much more difficult than it seems. Support is a price level where a downtrend can be expected to pause due to an overflux of demand. As the price of a security drops, more buy orders are triggered and that forms a support line. On the other hand, resistance zones start to form, because people start to sell their assets due to the spikes in prices. When the price of potential resistance and support are determined, that is an ideal chance for a trade entry or exit point. Because when a price reaches either a support or resistance, these leads to two possible scenario outcomes; either it will bounce back away from the support or resistance level, or it will continue its downtrend until it hits the next resistance or support level. Most forms of trades are made on the presumption that the resistance or support level will not be broken on that day. Until price deviates from support or resistance level, traders can "bet" on the direction and can quickly see if their predictions were correct. If the price will move in traders predestined direction he will profit from it, if it goes the other way around he will soon close his position with a small loss. The resistance and support are best explained if an elevator is a price. And we know how elevators work they move up and down, pick a few riders at the basement floor and, drive up to the highest floor in the meantime it stops somewhere in between and picks up new riders. That is how the resistance and support basically work only that our elevator is limited to the highest floor and the lowest if elevators could move beyond their limit it would be an imaginary explanation of how support and resistance acts.
Simply put, an Airdrop means a coin/token is distributed to the community for free or for small tasks. This is done to ensure early distribution and to have as many people with “skin in the game” as possible.
An Airdrop aims to build a huge community easily as people will pay attention to the coin they hold. Furthermore, they tend to promote this coin for profits, and this may cost the Development Team very little to achieve the goal of advertisement.
Or user tokens, provide users access to a product or a service. They are not designed as an investment but represent future access to a company's product or service. Through utility tokens, ICO's startups can raise capital to fund the development of blockchain projects and users can buy earlier access to the service.
A statistical measure of the dispersion of the returns, measured by using the standard deviation or variance between returns from that same security or market index.
The amount of cryptocurrency that has been traded during a certain period of time, such as the last 24 hours or more. Volume can show the direction and movement of the cryptocurrency as well as a prediction of future price and its demand.
An informational document that generally informs readers on the philosophy, objectives and technology of a project or initiative. White papers are often provided before the launch of a new coin or token and are used to raise funds on the promises of goodly written white paper.
In cryptography, a zero-knowledge proof enables one party to provide evidence that a transaction or event happened without revealing private details of that transaction or event.