The state of the system is usually maintained by trusted third party, like a bank or a company web server. It is important that you read and consider the relevant legal documents associated with your account, including the Terms of Business issued by FXCM Markets before you start trading. The term “rekt” is crypto trader slang for “wrecked.” Basically, it means that a trader lost substantial amounts of cryptocurrency glossary money. Newcomers are frequently described as “noobs” by industry insiders. KYC stands for “know your customer.” Many jurisdictions have KYC regulations, which have come to affect startups holding ICOs. These regulations require companies holding these digital token sales to verify the identity of their investors. Escrow refers to a third-party holding financial resources on the behalf of other parties.
BSA requirements include mandatory reporting of certain activities, record keeping for all customers, and limitations on what kind of monetary instruments may be purchased or exchanged. A type of computer processing chip that performs a singular function. We may also ask to see your driver’s license or other identifying documents. There is no assurance cryptocurrency glossary that digital currencies will achieve their objectives. Cryptocurrencies are very speculative investments, involve a high degree of risk, and are not suitable for all investors. Investors must have the financial ability, sophistication, experience and willingness to bear the risks of an investment, and a potential total loss of their investment.
An act of fraud that pretends to be a particular entity to receive assets or information from the victim. Any transaction that has several outputs is a multiple output transaction. The input is where a transaction cryptocurrency glossary is being sent from, or where a transaction starts. An ERC-20 token piggybacks off of the Ethereum network, but for an ERC-20 token to be accepted, the token must meet a certain set of rules.
Trade popular currency pairs and CFDs with Enhanced Execution and no restrictions on stop and limit orders. Weak Hands An investor prone to panic selling at the first sign of a price decline. Volatility A statistical measure of dispersion of returns, measured by using the standard deviation or variance between returns from that same security or market index. Venture Capital A form of private equity provided to fund small, early-stage firms considered to have high growth potential.
Market Maker
Customers should consult an attorney or tax advisor for specific tax or legal advice. Only a particular file can produce a particular hash, and two different files will never produce the same hash. bitcoin – without capitalization, is used to describe bitcoins as a unit of account. e.g. “I sent ten bitcoins today.”; it is also often abbreviated BTC or XBT. A whitepaper is written by those that are launching a new digital coin. It explains everything about the coin that someone may want to know.
Examples of fungible currencies are $1 bills, each of which is alike and represents the same value. Interoperability is about systems talking to each other — whether devices, networks, or applications.
- The block reward is a reward given to miners for each block created in a blockchain.
- This is an incentive reserved for solving the mathematical problem linked to the block.
- Different kinds of cryptocurrencies give out block rewards with different values.
- During this entire process, the users have full control and ownership of their private keys.
- To put it in simple terms, atomic swaps will enable people to directly trade with one another wallet-to-wallet.
- Atomic swap is a peer-to-peer exchange of cryptocurrencies from one party to another, without going through a third party service like a crypto exchange.
Wallet
Blockchains are distinct from other computer networks because they are permissionless. Any computer, anywhere can become part of this larger virtual computer as long as they follow the consensus algorithm.
Bear Market
A soft fork often occurs during software upgrades to the protocol. This type of “soft” fork does not result in a permanent split of the network and is more akin to a network migration or upgrade. In other words, nodes on the network remain compatible with one another.
Decentralization is the degree to which control — power, resource allocation, etc. — over a given network is distributed across a large, representative base of independent actors. Depending on the network, each node can have a unique role or multiple nodes can share a single role. This architectural design choice reflects cryptocurrency glossary a fundamental tradeoff between network redundancy and efficiency. In networking, a protocol is a common program executed by multiple computers on the same network. These networking protocols govern the transmission and handling of information as well as execution of programs between interconnected but independent devices.
Keywords
A protocol is a set of rules or procedures that govern a system — whether that system is a computer network, a town hall meeting, or a board game. For instance, in chess, individual players may have their own strategies — but the way in which each chess piece moves on the board is dictated by the rules of chess. The “state” of a system is a snapshot of that system at a given point in time. For instance, “state” might refer to an individual checking account balance; after spending $20, the state of the account should represent their new, reduced balance.
A third-party would hold funds in escrow when the other entities involved in a transaction may not trust each other. A distributed denial of service attack takes place when multiple parties work together to overwhelm a system by inundating it with either requests for information or malicious data. Basically, the nefarious parties involved in such an attack want to prevent a resource, such as a server, from being able to provide some specific service, such as serving a web page. Cryptography is basically the process of encoding and decoding information so that would-be observers are unable to understand the information being sent. If a trader believes that an asset will rise in value, he or she is a “bull.” When an investor has this optimistic expectation of an asset’s future bull, this frame of mind is described as “bullish.” Trade your opinion of the world’s largest markets with low spreads and enhanced execution.
Bitcoin (btc)
The increase in mining difficulty in Ethereum because of its migration to Proof of Stake. A period characterized by a strong selling activity, when investors give up their positions and sell their assets as quickly as possible. Sending half of a cryptocurrency glossary block of your ETH from Exchange #1 to Exchange #2 causes a split of one into two. An “investment” or “investment segment” refers to holding a token for a time duration that causes capital gains or losses, and has a definite start and end date.
Considered as a high risk strategy that should only be used by experienced investors. An accounting method that is used to calculate a tax base for a sale of multiple assets with different bases, when investors sell the newest ones first cryptocurrency glossary (last-in, first-out, or LIFO). An investment is a fraction of an asset bought or sold that results in a capital gain or loss. These are mapped one-to-one in the Grand Unified Accounting sheet, and used to populate IRS tax form 8949.