- Beginner's Guides
Important Cryptocurrency Terms You Should Know
Before you start investing in crypto, we strongly recommend you research the crypto market, cryptocurrency projects, and different ways you can leverage the digital platforms to make money online.
What’s key to note here, however, is that, during your research, you may come across some terms that we don’t use in our regular lives. Without understanding these terms, it can be considerably difficult for you to grasp the important concepts of crypto investment.
Here are some key cryptocurrency terms everybody should know;
Each cryptocoin on the blockchain has a unique address. If a coin doesn’t have a Bitcoin address, it means that it isn’t properly stored on the blockchain and hence is inaccessible. If you want to own a digital coin, you need to have a wallet address.
Every time you make a digital transaction, the value of your digital wallet gets updated on its specific address. Every cryptocurrency has a different address format.
Altcoins refers to cryptocurrencies other than Bitcoin. Altcoins feature a smaller market for investment but each altcoin has different characteristics and experts strongly suggest crypto investors diversify their investment portfolio by investing in different altcoins to increase their chances of profitability.
Bitcoin is the first decentralized digital currency, launched in January 2009. Bitcoin is considered the most reliable and secure digital currency and hence it’s the most widely used digital currency in the world. The cryptocurrency has seen steady growth in the past years. Currently, a Bitcoin equals $61,587.
Bitcoin cash is an alternative to Bitcoin that has its own specifications and blockchain. It offers a greater transaction speed and relatively lower transaction fees because of the shorter wait times.
The blockchain network consists of small blocks of information which store the transaction records that take place during a specific time interval. Every time a block is completed, a new block is developed and the old one becomes a thing of the past.
Blockchain blocks allow the digital transaction system to run securely and fast without any loss of information.
The term blockchain refers to the record-keeping technology behind Bitcoin. Blockchain store the information in small blocks chained together to streamline the data. It allows all the cryptocurrency users to acquire the system control.
Coinbase is a well-established cryptocurrency exchange developed by Coinbase Global Inc. It’s a beginner-friendly platform that offers a simple and easy transaction process. There are two versions of Coinbase. Coinbase Pro is a little more complex as it offers more transaction options and lower charges.
Cold wallet refers to the concept of storing your cryptocurrency completely offline. Unlike a hot wallet, where you always keep your digital assets online, a cold wallet is a hardware wallet or a physical device that allows you to keep your cryptocurrency safe and hence safe from cyber attacks and hacking. But since a cold wallet doesn’t offer any backup, you can lose access to your investments if you misplace your wallet.
Cryptocurrency is a term used to define digital money that comes in the form of tokens and coins. It’s typically a virtual and intangible form of money but some digital currencies also come in credit cards. Cryptocurrencies are primarily developed through a mining process and they’re not monitored by your state's government. Currently, there are more than 6,500 cryptocurrencies in the world.
Decentralization refers to the transfer of supervision authority from a centralized association like the government to a dispersed network. Decentralized markets deploy technology such as blockchain to allow investors to directly deal with each other, without any interference from a third-party.
While decentralization minimizes the communication gap and improves transparency, it's also very risky because there are no central authorities to provide a legal framework or offer assistance if an unfortunate event takes place.
Ethereum is the second-largest cryptocurrency platform worldwide in terms of trade volume. The crypto network allows developers to develop and run decentralized apps aka ‘apps and smart contracts without any downtime or interference, or control from third parties.
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Feel free to take a look at our cryptotrading resources and information. At Urban Crypto, we aim to help our clients enter the crypto market and improve their financial health. We offer comprehensive beginners' guides for Binance, Coinbase, and Cryptocurrency. If you want to make money with cryptocurrency, or are eager to learn about the best wallets and exchanges to invest in, you can find it on our platform.
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