Familiarized yourself with crypto via these terms
So, you are interested in cryptocurrency and blockchain technology, maybe from reading BHO Network website and seeing the BHO token. Of course, this field naturally does not reject anyone. But are you sure you know your stuff before getting into crypto? Worry not, today BHO Network will help you familiarize with crypto and blockchain by learning some simple terms.
You may have heard some terms like HODL, DApps while looking up cryptocurrency, and may wonder: “What the hell is that?” Luckily, that’s not some alien language - it’s terms used in the cryptocurrency world. There are many more terms, and with any new field, learning takes some time.
As of now, crypto is not overtaking credit cards yet, but they are increasing in popularity, and may someday do so. And cryptocurrency is a type of investment very much different from traditional stocks and bonds. So, it is worth knowing some basic stuff, whether you are looking forward to being a serious investor, or just to gain some knowledge in general.
Anyway, here are the terms to get you started on your crypto journey!
Address: just like a normal address, it is where a cryptocurrency is received, but this is represented by a series of letters and numbers.
ATH: short form for all-time-high. It's quite self-explanatory, the highest value to date of a cryptocurrency.
Bitcoin: this is a term you must have heard quite a few times. It is even considered a household name. It is the very first cryptocurrency, and now is still the one with the highest value, as well as market share.
Blockchain: the technology behind the creation of cryptocurrency. Basically, it’s an online digital ledger, which is used to store verified and public transactions using cryptocurrencies. Information about transaction records is stored in “blocks”, and are linked together via “chains”. The subsequent blocks are built upon the previous blocks, so to change one block you must change every other previous and later blocks as well. This strength in security is one of cryptocurrencies’ biggest advantages over traditional trading.
Cold wallet/storage: no, it’s not actually physically cold. This is a way to store your cryptocurrency completely offline. One easy to visualize example is a USB drive, usually with passwords. This type of wallet can protect you from being hacked, but if you lose it, then you lose all our crypto wealth.
Decentralization: the principle which all cryptocurrencies work. Blockchains technology are decentralized in nature, because it requires majority approval of users to operate and make adjustments, rather than an authority figure/organization.
Decentralized Finance (DeFi): financial activities carried out without needing an intermediary, such as a bank, government or financial institution. BHO tokens promises to be exactly this - no need to go through third parties.
Decentralized Applications (DApps): applications designed and deployed on a blockchain to do activities without intermediaries. DeFi activities are often carried out using DApps. This is also one of BHO's features: using DApps for DeFi activities, without intermediaries.
Fiat currency: it’s your US dollars, Euro, Yen, Vietnamese dong, etc. Basically currencies you are using now, which are backed and issued by governments.
HODL: short for “Hold On for Dear Life”. However, this term starts as a misspelling of the word “hold”. This is basically an investment strategy, in which a person buys and holds a cryptocurrency - without trading - in the hope that it will increase, or even skyrocket, in value later on. If that happens, that person will make a huge profit.
Hash: strings of numbers and letters that are randomly generated, used to identify blocks.
Hot wallet: the opposite of cold wallet, and no, they are not physically “hot”. It is similar to those virtual wallets, or your accounts in online banking. While those are comfortable, they are vulnerable to being hacked, compared to cold wallets, where only you can be the cause of losing access to the vault.
Initial Coin Offering (ICO): similar to IPO (Initial Public Offerings), this is a way of raising funds for a cryptocurrency project. Only that, instead of stocks, coins - or tokens - are used instead.
Market cap: also known as market capitalization, this is the total market value of a cryptocurrency.
Mining: the process to uncover new units of a cryptocurrency. “Crypto miners” use hardware and technology to solve complex formulas to verify new blocks of cryptocurrency that are added to the blockchain. By doing so, they are awarded with digital tokens. Mining is often said to be the weak spot of cryptocurrencies, as this process uses a lot of energy, and is not environment friendly. BHO token is one of the few that does not run into this problem.
Node: a computer that connects to the blockchain network. Every node in the network has to agree for a block to be changed - which is a very tall order for hackers.
Non-fungible Tokens (NFTs): units of value representing the ownership of unique digital items such as artworks, or collections. BHO tokens can also be used for NFTs as well.
Peer-to-peer: two users interacting directly without a third party.
Private and public keys: public keys are like your account number, and private keys are your passwords or PINs. They are also represented by strings of letters and numbers. Be careful not to lose your private key, as you will lose access to your crypto vault as well!
Smart contract: a program that uses algorithms to execute a contract automatically. This shortens the transaction time drastically, and this is also a feature that BHO Network employs.
Stablecoin: a stablecoin has its value pegged to some non-digital currency or commodity, such as a fiat currency.
Token: a unit of a type of cryptocurrency.
So, those are some essential terms you should know before getting into cryptocurrency. Hopefully those will be useful to your crypto journey. Stay tuned, as BHO Network will give you more tips and guides on your way to crypto mastery!
Published on July 14, 2021
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