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Crypto Trading

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cryptocurrency glossary

Bitcoin

A parabolic movement of an asset results in a”runaway”condition. Overnight position is a term which is used in relation to trades left open until the following trading day on international financial, currency, and commodity futures markets. An order is an investor’s or trader’s instruction to a broker, brokerage firm or exchange to purchase or sell an asset on the investor/trader’s behalf. These order instructions will affect the investor’s profit or loss on the transaction and, in some cases, determine whether the order is executed at all. 1) Net position is the amount of currency bought or sold that hasn’t been offset by opposite transactions. Liquidity is a market’s feature whereby an individual or firm can quickly purchase or sell an asset without causing a drastic change in the asset’s price. Liquidity is about how big the trade-off is between the speed of the sale and the price it can be sold for.

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The Halvening is the date, time, and block at which Bitcoin’s miner subsidy/block reward is halved. This usually causes a supply shock in the market and is a main driver of market impulse movements. The flippening is the idea that at some point Ethereum’s market capitalization, and overall blockchain dominance, will overtake Bitcoin’s. Technical analysis is financial market analysis that uses patterns in market data to identify cryptocurrency glossary trends and make predictions. It is the use of past price information to identify trends, areas of supply & demand, and profitable trade setups. They are taking the price that is asked by the limit buyer or seller. Systems trading is following an algorithmic set of rules for reacting to market conditions such that, when conditions are met and rules followed, has been shown to be statistically profitable over time.

Anyone can mine Bitcoin Gold and deposit it into a Celsius Network wallet, where rewards may be earned. Bitcoin Cash – A form of cryptocurrency that’s frequently referred to as “Peer to Peer Electronic Cash.” As of block , all Bitcoin holders are also Bitcoin Cash owners. Bear Trap – A bluff employed by a group of cryptocurrency cryptocurrency glossary traders, in which a certain cryptocurrency’s price is manipulated. The trap is set when the traders sell off their crypto all at once, initiating a massive selloff of that crypto and a subsequent price drop. Arbitrage – Buying cryptocurrency from one exchange and selling it to another exchange at a higher rate.

Token – Similar to cryptocurrency, a token can have functions other than the simple transfer of value; ERC-20 tokens are a good example. Pump and Dump – The process of inflating the value of an asset which has been acquired / produced cheaply. Misleading statements and aggressive publicity are two hallmarks of pump and dump schemes. OTC – An acronym for Over the Counter, meaning a transaction that has been made using a Bitcoin ATM or via another method for trading outside of an exchange. Non-custodial – A P2P cryptocurrency exchange in which buying and selling takes place on an individual, case by case basis. Maximum supply – The maximum number of tokens that will exist for a certain cryptocurrency.

Masternode – A governing hub found in certain cryptocurrency networks, requiring a stake or initial collateral to operate. These buy and sell cryptocurrency orders are placed by traders when a certain price is reached. Immutable – When a cryptocurrency transaction has been cryptocurrency glossary completed, it is done; i.e. it is immutable and cannot be changed. Hot Storage – Private keys stored online, allowing for rapid access to one’s cryptocurrency. Governance – A process that allows the cryptocurrency community to reach a consensus on an issue of concern.

Digital Currency

cryptocurrency glossary

Dust Transactions

Resistance is an area of a specific asset or market that price has difficulty rising above. Areas of price that have acted as resistance, once overcome, can act as future support and vice versa. Range refers to the difference between an asset’s low and high price for a particular trading period. A rally is a period of sustained increases in the price of a specific asset, asset class or an entire market. A protocol is basically a foundational layer of code that tells something how to function. It’s the program that forms the software basis of any given network.

cryptocurrency glossary

A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies, and cash equivalents, as well as their fund counterparts, including cryptocurrency glossary mutual, exchange-traded, and closed funds. A portfolio can also consist of non-publicly tradable securities, like real estate, art, and private investments.

Contract Creation Transaction

  • Yet the mechanisms they incorporate to minimize price volatility make them a more useful medium of exchange, enabling a broad range of economic activity.
  • These validators are selected through some type of network governance mechanism — for example, by a token-weighted vote per user account.
  • The attackers would be able to prevent new transactions from gaining confirmations, allowing them to halt payments between some or all users.
  • They would also be able to reverse transactions that were completed while they were in control of the network, meaning they could double-spend coins.
  • Because they’re deployed on top of blockchains, stablecoins retain the advantages of cryptocurrencies — digital, global, easily transferable, and decentralized.
  • DPoS is a type of consensus that limit the number of validators who can add blocks to the blockchain.

Think of a protocol as a set of rules that allow entities to communicate and transmit information. Price discovery is the process of setting the spot price, but most commonly the proper price, for a security, commodity or currency. Presale, in cryptocurrency, is a token sale available to a limited number investors before the project’s official ICO. In traditional finance, presale is an order to purchase part of a new municipal bond issue that is accepted by an underwriting syndicate before an official public offering.

Smart contracts encode business rules in a programmable language onto a blockchain and are enforced by the participants of the network. A short squeeze is a market event in which a large amount of short interest has accumulated on an asset but price continues cryptocurrency glossary to appreciate. Shorts are forced to cover or be liquidated, which causes price to appreciate even more, causing more shorts to be forced to cover, etc. This domino effect tends to cause large positive price movements as shorts flee the market.

I like bourbon, playing tennis with my wife, and playing guitar while she sings (sometimes I’ll join in). “Fear Of Missing Out.” An emotion experienced by those who haven’t bought any cryptocurrency and see prices continually rising. A currency that is usually backed by a government or group and whose value is tied to the investing cryptocurrency glossary public’s confidence in the government that backs it. The United States dollar changed from a fixed currency to fiat in the 1970’s. Cryptocurrencies are fiat currencies that are not backed by any government — their value is determined by those who trade them and the confidence that the value will increase over time.

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