Crypto Glossary for Nonprofits and Donors

Non-Bitcoin cryptocurrencies are collectively known as “altcoins” to distinguish them from the original. Add cryptocurrency to one of your lists below, or create a new one. It is one of several prominent efforts to enable complex financial functions in a cryptocurrency. First proposed by Dr. Gavin Wood, Web3 represents a new vision and focus for web applications- from centrally owned and managed applications, to applications built on decentralized protocols . An off-chain solution that uses validity proofs to improve transaction throughput. Unlike Zero-knowledge rollups, Validium data isn’t stored on layer 1 Mainnet. The process of downloading the entire latest version of a blockchain to a node. A layer 2 solution where a channel is set up between participants, where they can transact freely and cheaply. Only a transaction to set up the channel and close the channel is sent to Mainnet. This allows for very high transaction throughput, but does rely on knowing number of participants up front and locking up of funds.

A connected computer that is part of a network, the Blockchain in this case. All nodes are equal and each one can be used to broadcast messages across the entire system. A digital currency that doesn’t have any inherent value and is used for social media purposes. These are the points at which an investor decides to buy or sell a particular coin/token. A market in which prices fall and negative sentiment is rife; this could lead to a drop-off in demand while buyers wait for lower prices. Anti-Money Laundering, a legal framework used by governments worldwide to stop financial crimes like money laundering, terrorist financing, fraud, and more.

Genesis Block

Know Your Customer, which refers to the process of obtaining and verifying personal identification information from customers for business purposes before allowing them access to services or products. The use of two different strategies in order to reduce the risk involved with one strategy. For example, you could hedge by taking a long position and shorting it simultaneously; this would result in your exposure being less than if you just went long or short on that particular asset/trade alone. The process by which Bitcoin mining rewards are reduced by 50% every four years; this is done to create scarcity and control the total supply . A person who spreads FUD about a specific coin or blockchain project, often for self-benefit. The moment when a cryptocurrency’s market capitalisation surpasses that of another crypto. A decentralised network where all incentive mechanisms are built into the protocol itself and not as an additional layer on top of it .

Read more about ethereum to dollar calculator here. The devices are built in a way that makes it physically impossible for the private keys to ever leave the device unintendedly. Storing private keys in a cold wallet is also referred to as holding them in cold storage. Cold wallets are considered one of the safest ways to store crypto assets. Bitcoin is a decentralized digital currency created in January 2009 by an individual or group of individuals named Satoshi Nakamoto. Bitcoin is one of the first digital currencies to use peer-to-peer technology to enable immediate financial transactions.

Cryptoasset

The purpose is to create fully autonomous systems with no need for central management. Buy The Dip; this means buying coins/tokens when the price drops and they’re cheap. AxiTrader Limited is amember of The Financial Commission, an international organization engaged in theresolution of disputes within the financial services industry in the Forex market. AxiTrader is 100% owned by AxiCorp Financial Services Pty Ltd, a company incorporated in Australia . Over-the-counter derivatives are complex instruments and come with a high risk of losing substantially more than your initial investment rapidly due to leverage.

Given lost or burned coins, this figure is hard to accurately establish. The term given to price behaviour which gives the impression that the market may be entering a long term upward trend but is actually just a short term correction, before resuming the downward trend. The term given to market behaviour which gives the impression that the price may be entering a long term downward trend but is actually just a short term correction rather than a reversal. Slang term for a large amount of cryptocurrency or referring to a portfolio in general e.g ‘what bags are you holding? A type of computer chip adapted to perform a very specific function, in the case of Bitcoin, ASIC chips are adapted solely for the mining process. A commonly used term to refer to cryptocurrencies that came after Bitcoin; literally alternative coins, i.e coins that are designed to work differently from Bitcoin. Form 1099-B is generally the form used by brokerage firms to report stock, commodity, or cryptocurrency gains and losses for the year. This form reflects a taxpayer’s cost basis, making it easy for the taxpayer to determine their overall tax position for the year. For example, in 2017 Bitcoin underwent a hard fork and Bitcoin Cash was created and airdropped to existing Bitcoin owners.

ICOs are a way of raising capital to fund the development of a digital asset such as a new coin. Investors can buy into the ICO by investing in the coin issued by the company. To invest in an ICO, an investor will need to have an existing cryptocurrency wallet. A crypto futures contract allows investors to speculate on the future price of a crypto asset. They enter into an agreement to buy/sell an asset at an agreed price on an agreed date in the future. Crypto futures and derivatives can be an attractive option for traders, https://www.beaxy.com/exchange/eth-usd/ as they can invest speculatively in market movements without having to hold the underlying crypto asset. Public key – encrypted message, a key, shared with the public allowing you to receive cryptocurrency to a crypto address. It is used in pair with the private key, which makes it, when received, readable again for the intended party. Blockchain – a growing list of records, called blocks, that are linked using cryptography. Each block contains a cryptographic hash of the previous block, a timestamp and transaction data.

However, as they are accessed with a secondary device such as USB keys, the risk shifts to the physical security of the secondary device. If this device is lost or stolen, the owners’ access to their funds could be compromised. A token is an asset that is not based on its own blockchain, but can be created on existing blockchains with little effort. There are different types of tokens such as utility tokens, equity tokens, security tokens, asset tokens or payment/currency tokens. In crypto, self-custody is synonymous with owing the private keys to your crypto assets. Self-custody is one of the fundamental principles crypto currencies were built on.

Block Size

Cryptocurrencies are digital or virtual currencies underpinned by cryptographic systems. They enable secure online payments without the use of third-party intermediaries. “Crypto” refers to the various encryption algorithms and cryptographic techniques that safeguard these entries, such as elliptical curve encryption, public-private key pairs, and hashing functions. Jake Frankenfield is an experienced writer on a wide range of business news topics and his work has been featured on Investopedia and The New York Times among others. He has done extensive work and research on Facebook and data collection, Apple and user experience, blockchain and fintech, and cryptocurrency and the future of money. A cryptographically secured digital currency that is transacted as tokens on a blockchain. FinTech Magazine is the Digital Community for the Financial Technology industry. FinTech Magazine covers banks, challenger banks, payment solutions, technology platforms, digital currencies and financial services – connecting the world’s largest community of banking and fintech executives.

As soon as an equivalent bid and ask offer is placed, the trade is immediately executed. SegWit is a protocol that reorganizes the data on the blockchain through signatures to allow for more transactions to be stored in a single block, thereby increasing scalability. A crypto or Bitcoin whale refers to individuals or institutions that hold large enough amounts of cryptocurrency to move or create waves in the market. These big players are often considered the source of market volatility and distortions, and have the ability to manipulate prices.

An API sits between an application and a web server, and facilitates the transfer of data between them. An object containing an address, balance, nonce, and optional storage and code. An account can be a contract account or an externally owned account . Not all assets that are in your portfolio, may necessarily be eligible to be used as margin.

Hashing refers to the process of a computer taking an input of any length and generating an output of a fixed length by running the data through a mathematical algorithm. Hash rate refers to the amount of hashes per second that a computer is capable of processing. The gas limit in an Ethereum transaction indicates how much computational resources the transaction sender is willing to pay for. A typical transaction that sends ETH from wallet A to wallet B uses gas. The gas price in an Ethereum transaction indicates how much a transaction sender is willing to pay for each unit of gas. In April 2021, Swiss insurer AXA announced that it had begun accepting Bitcoin as a mode of payment for all its lines of insurance except life insurance . Premier Shield Insurance, which sells home and auto insurance policies in the US, also accepts Bitcoin for premium payments. The best option for you will depend on your investment goals and risk appetite. Access our best apps, features and technologies under just one account.

This enables a much greater network throughput, though at the cost of some redundancy. If a dishonest validator violates the protocol, their deposit is “slashed” or confiscated and distributed to the remaining honest validators on the network. Blockchains are exponentially composable, since they are both permissionless and permanent. Each additional smart contract or application added to the network is open and accessible to developers looking to build upon and extend its functionality. By enabling and incentivizing a true open-source ecosystem, the possible applications are limited only to our imagination.

• The process of retransmitting encrypted messages back to their original format.
• A 51% attack is a hypothetical scenario in which more than 50% of a blockchain network’s nodes fall under the control of a single group.
• For example, if someone steals the password to your personal PayPal account, uses the password to access your Cryptocurrencies Hub, and sells your Crypto Assets, an Unauthorized Transaction has occurred.
• A type of cryptocurrency that is designed to provide specific utility within a blockchain ecosystem.

This output can then be used as the input, or payment source, for the next transaction. However, fewer than half of all coins and tokens issued through ICOs retain value for more than six months, according to some estimates. The Latin word fiat means “let it be done” and signifies an edict by authority. In the context of money, this term was originally used to describe currency that derives its value from the economic stability of the issuing government, rather than being backed by any commodity. Altcoin, or alternative coin, is a general description for any cryptocurrency other than Bitcoin, such as XRP , Litecoin, Bitcoin Cash and Monero. For investigation of cryptocurrency frauds and financial crimes, we believe every effort must be made to report findings in a manner that is comprehensible to a layperson. It can be challenging to convey technical and cryptographic concepts in the plainest language possible — but you cannot persuade a judge or jury if they don’t understand what you’re talking about. Etoro money service is provided by eToro Germany GmbH., supervised by Bundesanstalt für Finanzdienstleistungsaufsicht, Bafin.

All the tokens and coins that will exist in a cryptocurrency network. A cryptocurrency is said to be “mineable” when it has the system thrugh which miners can be rewarded with newly-created cryptocurrencies for creating blocks. An exchange-traded fund is a form of security that tracks a collection of securites such as stocks, bonds, index or cryptocurrency but tradeable like a single stock. A new form of malicious activity in which hackers and scammers attempt to undermine the privacy of cryptocurrency users by sending little amounts of money to their wallets. The Cryptocurrency Act of 2020 is a bill which aims to clarify which federal agencies would regulate which type of crypto assets. Algorithmic stablecoins are tokens pegged to a fiat currency which is usually the US dollar, purely through software and specific conditions. It is an investment strategy to gain potential return of the investment by borrowing the money. For example, you could loan from an exchange to conduct a margin trading, where you leverage your positions by buying asset at a low price and sell them at a higher price. An algorithmic program that enacts the terms of a contract automatically based on its code.

X86 Virtual Machine X86 Virtual Machine enables Qtum developers to write smart contracts in a language of their choice. The total number of crypto was traded during a certain period of time. Software provided by the exchange that allows traders to directly place orders without having to contact a broker or any other intermediary. The process of increasing the block size limit by excluding signature data from transactions’ details. Opening position means that the trader entered the market and holds a certain amount of crypto. To close the position, a trader should either sell or buy that crypto, depending on whether he chose a close or long one. An abbreviation for the phrase “number only used once.” In crypto, it refers to the number that blockchain miners are looking for and working on. Nodes communicate with each other to perform various functions, such as validating new blocks and adding them to the blockchain. In crypto, it usually refers to an additional security requirement of multiple keys for the transaction verification. Also known as a hash tree, it is a hash-based data structure that can efficiently and securely encode the blockchain data.

Forks are either a hard fork or a soft fork (a backward-compatible upgrade that does not result in a split). Online service that enables its users to buy or sell cryptocurrencies. Digital currency that uses cryptography and blockchain to encrypt, secure, and verify transactions. As blockchain is more widely understood, its technology is likely to be used far beyond cryptocurrency. A tokenised version of bitcoin that follows the ERC20 standard and is therefore interoperable with Ethereum services like Defi and dApps.
6.1 We may elect to add or remove cryptocurrencies as Supported Cryptocurrencies for the Buy/Sell service from time to time. Where we remove a cryptocurrency as a Supported Cryptocurrency (a “RemovedCryptocurrency”), we will notify you by email. Proof-of-Work – consensus protocol used to validate the transactions that occur in a Blockchain network and which satisfies certain requirements. It is often a form of crowdfunding, however a private ICOs which does not seek public investment is also possible. Staking allows owners to deposit their cryptocurrencies and be rewarded with new coins. With staking, the owners support the network and receive the corresponding rewards in return. For example, an oracle can be used to feed weather data onto the blockchain for use in specific applications.

A decentralised application programming interface that is intrinsically interoperable with blockchain networks. Refers to decentralised digital currencies that facilitate value transfers on distributed ledgers without the need for intermediaries. The coin or token awarded to miners or a group of miners for solving mathematical problems required to create a new block on a given blockchain. A block explorer is a tool for publicly auditing the entire transaction history of a blockchain network. The Giving Block (or “TGB” for short) makes Bitcoin and other cryptocurrency fundraising easy for nonprofits. The Giving Block empowers mission-driven organizations, charities, universities, and faith-based organizations of all sizes to leverage crypto technology to achieve their mission. The total value of all of a cryptocurrency’s tokens, not only a single token. A change to the rules or protocol of a blockchain as its developers make updates.