Are you going to invest in Cryptocurrencies?
Indeed, it’s a good step towards first investment in Bitcoin or any other cryptocurrency. But, you are confused about all the terms used by people already in this business. So, let us make you less puzzled.
Here is a list of various terminologies related to cryptocurrency. Let’s explore them…
It is a virtual currency designed to replace the traditional payment system by using virtual coins. It includes the exchange of cryptocurrencies. Transactions are done securely and quickly because there is no existence of third party to validate the transactions.
Bitcoin and Ether are examples of cryptocurrency.
A plethora of websites is available, where you can buy or sell cryptocurrencies. Physical money can be exchanged by cryptocurrency. You can also check app development company.
Any crypto-currency other than Bitcoin and Ethereum is called an Altcoin.
It is an abbreviation of Initial Coin Offering. An unregulated means through which new cryptocurrency venture is funded. Investors are offered new cryptocurrency in exchange of Bitcoin or any other cryptocurrency.
The total value of a cryptocurrency is calculated by multiplying the total supply of crypto coins by the price of an individual unit. Cryptocurrencies are ranked according to their market cap in the world of virtual money. Currently, Bitcoin tops the list.
It means Return on Investment. It is the percentage of money, which the investor will get after doing the initial investment.
It is the technology, on which almost every cryptocurrency runs. It is a public distributed ledger in which all the flow of transactions is done. Every transaction is split into blocks, which are already distributed. When all the information of the transaction is received, the blocks are then linked to each other. This is what it gives the name Blockchain. Every data is distributed to computers worldwide, which are busy creating new blocks for transactions.
It is the situation when a Blockchain splits into two separate chains. It happens when new rules are implemented into the Blockchain’s code.
Basically, a computer contains a copy of blockchain and it is working to maintain it. Miner’s computer can be referred to a node.
It is the procedure of solving multifaceted mathematical equations. Solving it adds a block in the Blockchain, which contains transactional data. It requires high computing power because the equations are hard enough to squeeze the CPU in minutes. In return of every block, creation rewards are given in the form of either Bitcoin or ether.
These are the people, who consume their computer power to do mining and when a miner is successful in creating a new block, reward is bestowed to him/her.
As you already know that cryptocurrencies are completely virtual, these virtual currencies can only be managed through a software called wallet. They are just like our banking digital wallets, but crypto wallets like a Bitcoin wallet is developed by a Bitcoin wallet development company and they are secured by cryptography. You can manage and trade your crypto coins through these wallets.
Hashes are cryptography parts, which secure the cryptocurrency. It makes the blockchain technology and wallet system almost impossible to hack. Hashes take variables as inputs and give random character length as output.