Here are some common cryptocurrency terms and definitions that you might find helpful to know.
Address: Sort of like an e-mail address, you can share your coin-specific address so somebody can send coins to you. People can have many different addresses and it’s typically recommended that you generate a unique one for every transaction.
Altcoin: Short for alternative coin, the term may be used to refer to any cryptocurrency other than bitcoin.
Blockchain: A cryptographically protected distributed ledger made up of blocks that contain transaction history. As the blockchain grows longer and longer, it becomes increasingly difficult to alter older transactions.
Cryptocurrency exchange: A crypto exchange is a digital marketplace where users can buy, sell, and trade cryptocurrencies.
Digital assets: Electronically stored valuables, such as cryptocurrency, that rely on algorithms and computing power for secure transfer and ownership verification, without need for a brokerage or bank account.
Digital wallet: To use cryptocurrency, you’ll need a digital wallet. A digital wallet stores private and public keys, which are necessary to send and receive coins. There are hardware, software, and paper wallets. Hardware and paper wallets (also known as “cold wallets” since they are not connected to the internet) are typically considered more secure than software wallets, although there are pros and cons associated with each. If you lose your private key and can’t access your digital wallet through back-up methods, you will never be able to recover your coins and they are effectively removed from circulation.
Initial Coin Offering (ICO): An ICO, also known as a token sale, is a means of crowdfunding where a company offers a new coin in exchange for fiat currency (U.S. dollars for example) or a digital currency (Bitcoin, Ether, Litecoin, etc.). Typically, the funds they receive are used to develop the new concept, and the token they issue will be used to transact on their network once it is launched.
Smart Contract: An agreement that is written in computer code and automatically executes when certain conditions are met. Some networks, most notably Ethereum, support smart contracts while others do not.
