The blockchain, and in particular the crypto space, has its own language, knowledge of which, and definitions of important terminology, will make it much easier to enter the crypto industry.
Increasing the chances of success in the crypto market
Investors who are thinking about taking up cryptocurrency should keep in mind that industry terminology can be very useful. By performing the necessary research and learning this information, potential crypto traders can increase their chances of achieving their investment goals.
Here are some of the popular abbreviations and acronyms that you will meet on your way in the crypto space
- BIP – bitcoin improvement proposal
- BTM – ATM for Bitcoin
- DAO – a decentralized autonomous organization
- DPoS – delegated proof of stake
- EEA – Enterprise Ethereum Alliance
- EIP – Ethereum improvement proposal
- ERC – request for comments on ETH
- EVM – Ethereum virtual machine
- FA – fundamental analysis
- LN – Lightning network
- MACD – moving average convergence divergence
- MO – medium of exchange
- P2P – peer-to-peer
- PoA – confirmation of authority
- PoB – proof of burn
- PoD – proof of developer
- SC – smart contract
- SegWit – separate witness
- SoV – a means of saving money
- TA – technical analysis or trend analysis
- UoA – unit of account
- UTC – coordinated universal time
- WP – White paper
- YTD – since the beginning of the year
Cyber security is an important element in the successful use of cryptocurrency. Developers and users should know the basics of technical abbreviations for cryptocurrencies. Some of these abbreviations include:
- 2FA – two-factor authentication
- Addi – address
- API – application programming interface
- ASIC is a specialized integrated circuit
- BFA – brute force attack
- Bech32 – Bitcoin address format (also known as bc1 addresses)
- CPU – Central processing unit
- BFT – Byzantine fault tolerance
- DAG – directed acyclic graph
- DAPP or dApp – a decentralized application
- DDoS – distributed denial of service
- DEVCON – developer conference
- GPU – graphics processor
- IPFS – interplanetary file system
- PKI – public key infrastructure
- NONCE – the number is used only once
- SHA-256 is the abbreviation for Secure Hash (256 bits)
- WWDC – worldwide developers conference
Financial cuts
The ultimate goal of using cryptocurrency is to earn money. Like stock traders, Bitcoin owners enjoy the risk and benefits of trading. See how technology and Economics combine in a list of trade terms and financial abbreviations:
- AML – Anti-Money Laundering
- ATH – historical maximum
- ATL – historical minimum
- ALT or Altcoin – alternative cryptocurrency (a cryptocurrency other than Bitcoin)
- CEX – centralized exchange
- CMC – Coinmarketcap
- DAICO – decentralized Autonomous initial coin offering
- DCA – dollar cost averaging
- DeFi – decentralized Finance
- DEX – decentralized exchange
- DLT – distributed ledger technology
- ERC-20 – token standard for Ethereum
- ERC-721 – token standard for NFT (non-interchangeable tokens)
- ETF – exchange-traded Fund
- ETP – exchange traded product
- FIAT – the usual national currency (for example, the US dollar, Euro)
- IBO – initial offer of remuneration
- ICO – initial coin offering
- ITO – initial token offering
- mBTC – millibitcoin (0.001 BTC)
- MCAP – market capitalization
- PnD – Pump-and-Dump scheme
- OTC – OTC
- SATS – Satoshi (the smallest denomination of bitcoin: 0,00000001 BTC)
- STO – placement of securities tokens
- TPS transactions per second
- Tx – the transaction
- TxID – the transaction identification
- uBTC – MicroBitcoin (0,000001 BTC)
- UXTO – unspent transaction
Using knowledge to start trading
The price of Bitcoin changes frequently, and some consider the digital asset unstable. However, the fact is that the value of most world currencies also changes slightly. And people make money by trading Fiat currencies and commodities based on these UPS and downs in prices.
Trading and cryptocurrency exchanges have already matured a bit. There are several trading methods and a huge number of exchanges offering various trading services. Exchanges offer charts, indicators, and order book reviews so that traders can get an idea of current market actions.
After studying momentum indicators, it is useful to learn about moving averages, and the charts have all kinds of them, such as “exponential moving averages (EMA)” and “simple moving averages (SMA)”. Moving averages collect data over a series of time frames to smooth out a visualized view of long-term and short-term trends.
Using trade statistics, you can set moving averages for all types of data points by creating a trend line of averages, and most traders look at moving averages such as 50, 100, and 200-day averages.
Momentum oscillators and moving average trend lines are among the basics of technical analysis, and there are many other tools such as Bollinger bands, Arun oscillators, ATR bands and moving stops, fractals, medians, and Fibonacci ratios.
Candle chart diagram
The candlestick chart is the most common chart used for technical analysis and forecasting of Bitcoin price movement. The chart is used in many other markets, such as Forex trading and national Fiat currencies. This style of charting is very popular, but it is often difficult to understand.
Unlike histograms, there are different aspects that look at the short-term and long-term perspectives differently. Candlesticks refer to the price of each trading session: open, maximum, minimum and closed positions. As the chart progresses, analysts can apply various trend lines and technical indicators to try to predict price movement, but in the world of trading, nothing is certain.
Day trading and strategy from within the range of
One of the types of crypto-asset trading that is quite popular all over the world is day trading, that is, transactions that are supposed to take place within one day. This means that the trader closes his position by the end of the day or within a certain period of time.
Intra-range trading (intraday) is relatively the same, and traders use shorter time periods to profit from scalping and sudden fluctuations in the value of the crypt. Day trading strategies are based on profit and can lead to profitable employment or a significant loss of investment. Such trading requires research and practice sufficient for daily profit.
Short, long bets, options and futures trading
This type of trading assumes that the trader is betting that the price of the Cue ball will be lower or higher for a certain period of time. Most recently, a trader drew attention to betting on a $ 10 million short position on Bitcoin and was liquidated because the Price increased significantly. This means that the trader made a bet that the price would fall, but lost, leaving only the option to buy back Bitcoin at the market price.
Long positions are basically the opposite, and the trader is betting that the price will be higher over time. In essence, this type of trading is like buying a product in the hope that the price of the product will fall or rise, and the trader will profit from the difference.
There are various methods of trading bitcoin options, futures, and speculative bets. Many exchanges offer these types of transactions, but they all require collateral in case the client loses. Additionally, trading Bitcoin futures can be risky, and traders should hone their skills when making these types of bets.
With charts showing trends, certain charting tools available on the exchange can help the trader better predict the short-and long-term movements of the cryptocurrency market. After getting to know the exchange and making a few simple trades, you may want to learn about some technical indicators and charting tools.
For example, the relative strength index (RSI) measures both the speed and strength of market price volatility. The RSI will give traders some idea of whether the market is “oversold”or “overbought”. The sister of the RSI oscillator is a stochastic indicator that measures the current dynamics in the markets and collects data on the support and resistance of a digital asset.
Another relative of these two oscillators is the convergence / divergence of moving averages (MACd). This particular indicator consists of two exponential moving averages and uses them to track momentum as well. In fact, these three technical indicators often look the same on the chart and move in their respective directions. But you need to know all this before you start crypto trading.
Trading bots
The introduction of automated cryptocurrency trading systems has made life much easier for many investors. Many traders have improved their financial situation due to the income generated by automated trading systems.
The best thing about these trading robots is that investors don’t need to do any work. Trading robots can handle everything. Automatic cryptocurrency trading systems are an innovative option that can be used by anyone who wants to make money on the cryptocurrency market without knowing how to make transactions manually.
One thing that stands out about an automated trading robot is that it is very easy to use. The cryptocurrency market is always filled with traders who want to sell or buy cryptocurrency. Market veterans attribute the strong market activity to the adoption of cryptocurrency by a large number of major brands in the retail and manufacturing sector.
But do not forget that trading robots are offered in excess in the crypto market. Not all of them will lead you to financial victory. Many of them are outright fraud. But this is worth talking about separately.
Summarize
Most of the General terms used in the industry should help the new investor better understand the market. Since this is a fairly dynamic and growing industry, it is likely that more industry terminology will be added in the future. But this is not enough to be successful. You need patience, care, and strategy, and only then will you succeed.
Pay attention to what is happening in the world of cryptocurrencies, be aware of the latest trends in the field of blockchains and luck will smile on you.
