The world of cryptocurrency can be daunting for newcomers. The industry is full of jargon and technical terms that can be hard to understand. We've put together a list of essential slang terms you'll need to know so that you don't have to feel left out when talking about crypto!
Let's start with something simple. Ponzi scheme is a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned through legitimate sources.
Not all Ponzi schemes are illegal. For example: a bank that credits interest on its deposit accounts could be considered a Ponzi scheme if it fails to maintain required reserves with Federal Reserve Banks.
A 51% attack is any situation where someone controls more than 50% of the network hash rate (or mining power), and uses it to rewrite the blockchain. This is rare, but still possible. In such a situation, an attacker could double spend coins or perform other types of malicious activity using their control over the network.
An alt-coin is a cryptocurrency that is an alternative to Bitcoin. The term “alt-coin” describes every single cryptocurrency except for Bitcoin, and Altcoins are referred to as Bitcoin alternatives since most altcoins hope to either replace or improve upon at least one Bitcoin component.
Examples of altcoins include Ethereum (ETH), Ripple (XRP), Litecoin (LTC), Monero (XMR), and Dash.
An Airdrop is when a blockchain project decides to distribute free tokens or coins to the crypto community. The free crypto will usually be distributed proportionally among community members who perform certain actions such as sharing links on social media, providing email addresses and other online actions will get you free tokens.
You may be wondering how you can participate in an Airdrop? Well, it’s pretty simple. There are websites where companies post their information about upcoming Airdrops and you just have to follow them on Twitter or follow their Telegram group and fill out a form once they announce that the token is ready for distribution. You will then receive your free crypto by either joining their Telegram group or by signing up for their newsletter list (if they require it).
To get more insight into what an Airdrop looks like, let's take a look at some examples of past events:
ASIC stands for Application Specific Integrated Chip and it is a computer chip designed specifically for one task. The main purpose of ASIC miners is bitcoin mining, as they can do it much quicker than regular computers. ASIC miners usually come complete with a built-in fan, which helps keep them cool while running all day long.
Ask price refers to the lowest price a seller will accept for a currency. It is almost always lower than the market price.
Examples: I bought some bitcoin at $9,000 and it went down to $8,000 in one day. Then I sold my bitcoin at $8,350 when the ask price was $8,600.
HODL is short for “hold on for dear life” and refers to the act of holding onto your cryptocurrency through its ups and downs, no matter what happens. It’s a reference to a drunken bitcoin chat post made by an anonymous person in 2013. HODL is one of the most popular crypto slang terms, as it has become synonymous with sticking it out even when all seems lost.
FOMO is the fear of missing out. It’s an important driver for adoption in the crypto world—if you don’t buy X coin, it might go up in value and you won’t get to take advantage of that increase.
A psychological phenomenon that occurs when a person is aware of a significant opportunity that they have no influence over, and which they may have missed. The fear of missing out (FOMO) is a key motivator for the adoption of new technologies by companies and consumers alike.
The term "moon" is used to describe the act of rising in popularity, or hitting a high point. It comes from the expression "to the moon," which means to reach success and prosperity.
You might say that someone is going to "the moon" when they're getting a lot of attention for something they've done—or you might ask someone else how far away from earth's atmosphere they are, as in "Are you feeling OK? You look like you're about to crash back down!" That would be another way of saying that someone has come down from their momentous high.
It appears that this saying originated during the lunar landing by Apollo 11 on July 20th 1969: mission control told Neil Armstrong and Buzz Aldrin that if their rocket failed at any point during their journey back home, they wouldn't be able to land safely because there was no atmosphere surrounding the Moon—and so if nothing else went wrong with them getting there in one piece (or rather three-point landing), then they would need some kind of device capable not only landing but also taking off again without being damaged by friction when traveling through air at such high speeds relative vertically downwards into our planet's surface!
What is "puppy protection"? The term "puppy protection" refers to the price of bitcoin and other cryptocurrencies, which have been very volatile in the past. When people have bought bitcoin at a high price and are waiting for it to go back up, they are called bagholders. Bagholders tend to get depressed when their coins dip in value, so they call themselves bagholders or puppy protectors. The name comes from someone who bought a dog on Craigslist with bitcoin but didn't want it anymore, so they tried to sell it again on Craigslist as a puppy protection program.
Bulls and Bears are the two major classes of traders in a financial market. A bull believes that an asset will increase in value over time, whereas a bear believes that it's headed for an adverse correction. Bulls are often considered to be more optimistic than bears (and vice versa).
Bagholders are people who hold on to losing investments too long because they don't want their losses showing up on their books. Once you're out of the stock market, you might as well sell it—but if you still have stocks on hand from earlier days of your trading career and they're not going anywhere, this can be hard to do emotionally.
This is not an exhaustive list, but these are all the terms necessary to understand casual conversation about cryptocurrency.
The blockchain space is growing and evolving quickly. There are many more terms used in crypto than the ones listed below, but these are all you need to understand casual conversation about cryptocurrency.
Some of these terms are specific to certain cryptocurrencies, such as Ethereum and Stellar; others are specific to exchanges (e.g., Binance), while others still are more general (e.g., mining).
We hope that after reading this article, you have learned a lot about some of the most common crypto slang terms. The world of crypto can be confusing at first and it takes time to get comfortable with it all. If you’re interested in learning more about cryptocurrency or trading then we recommend checking out our other articles on these topics.