NOTES FOR YOUR FILE AND AT-A-GLANCE REFERENCE:

One of the founding principles of cryptocurrency is that it's

decentralized and unregulated. But the U.S. government
isn't too worried about crypto's founding principles. In fact,
cryptocurrency regulation has been a frequent point of
interest lately for U.S. lawmakers and government agencies.

The cryptocurrency market has its own cycles, like all other
markets, but cycles in it occur many times faster than in the
traditional market.

In 2014, you could expect one initial coin offering (ICO),

or crowdsale as they were called then, to launch in two
months. In 2017, two or three launch each week.

A Quarter of US Investors Own Bitcoin, More Than Half

Bought This Year 2021.

According to Grayscale's latest survey: - 26% of adult

Americans own Bitcoin - 55% bought Bitcoin in the last 12
months - 66% of new Bitcoin buyers are holding it for
growth.

There has been a material shift in investors mindset in the

last year, from a desire to explore and experiment with
crypto, to actually building a strategy and product roadmap.
Understanding the crypto ecosystem is “a vital rst step”
for interested persons, eager to pursue crypto offerings and
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 dip one toe in non-fungible tokens (NFTs), or digital
currencies.

Stock markets open and close - Monday through Friday -

morning ’til closing bell - regulated.

Cryptocurrency markets don’t sleep - 24/7 - ‘round the

clock - unregulated.

Digital asset · In the simplest terms, a digital asset is content

that's stored digitally. That could mean images, photos,
videos, les containing text, spreadsheets, or slide decks.
Graphics (such as logos and other brand assets). Also
electronic bank account statements; but the actual liquid
funds held in the bank account would not be considered a
digital asset.

Digital money · Digital money (or digital currency) refers to

any means of payment that exists purely in electronic form.
Digital money does not have a physical and tangible form,
such as a dollar bill, euro or a coin, and is accounted for
and transferred using online systems.

Wallet · A place to store your cryptocurrency holdings.

Many exchanges offer digital wallets. Wallets may be hot
(online, software-based) or cold (of ine, usually on a
device).
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 Cryptocurrency · A cryptocurrency (or “crypto”) is a digital
currency that can be used to buy goods and services, but
uses an online ledger with strong cryptography to secure
online transactions. Nearly 15,000 different
cryptocurrencies are traded publicly. Cryptocurrency is a
type of currency that’s digital and decentralized.
Cryptocurrency can be used to buy and sell things, or as a
long-term store of value.

Cryptoasset · Digital assets which use cryptographic

techniques to generate a medium of exchange of nancial
transactions. ... The currency is encrypted (secured) using
cryptography to secure nancial transactions, create
additional units, and verify the transfer of assets.

Token · Technically, “token” is just another word for

“cryptocurrency” or “cryptoasset.” The rst is to describe
all cryptocurrencies besides Bitcoin and Ethereum (even
though they are technically also tokens). The second is to
describe certain digital assets that run on top of another
cryptocurrencies’ blockchain, as many decentralized
nance (or DeFi) tokens do. Tokens have a huge range of
potential functions, from helping make decentralized
exchanges possible to selling rare items in video games. But
they can all be traded or held like any other cryptocurrency.
A type of cryptocurrency that represents an asset, or has a
speci c use with a blockchain ecosystem. Some tokens are
used for governance, allowing holders to vote on changes to
the blockchain. A Token is a unit of value on a blockchain
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that usually has some other value proposition besides just a
transfer of value (like a coin).

Coin · A representative store of digital value that lives on a

given blockchain or cryptocurrency network. Some
blockchains have the same name for both the network and
the coin, like Bitcoin. Others can have different names for
each, like the Stellar blockchain, which has a native coin
called Lumen.

Blockchain · A network of independent but connected

blocks, copies of which are distributed within a
decentralized computer network. One Bitcoin transactions
are added to a block and the new block is created, that
transaction is veri ed and updated throughout the
blockchain. A blockchain is a digital form of record
keeping, and the underlying technology behind
cryptocurrencies. A blockchain is the result of sequential
blocks that build upon one another, creating a permanent
and unchangeable ledger of transactions (or other data).

Block · A block is a computer le that keeps a record, or

ledger, of cryptocurrency transactions completed during a
given period and is worth a speci ed number of coins. For
example, one block in the Bitcoin blockchain is worth 6.25
Bitcoins, a number which will halve every four years until
2140 when the last block is created. Block Groups of data
within a blockchain. On cryptocurrency blockchains, blocks
are made up of transaction records as users buy or sell
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coins. Each block can hold only a certain amount of
information. Once it reaches that limit, a new block is
formed to continue the chain.

Distributed Ledger · Another name for a blockchain.

Block Height · The total number of connected blocks in a

blockchain.

Decentralization · The principle of distributing power away

from a central point. Blockchains are traditionally
decentralized because they require majority approval from
all users to operate and make changes, rather than a central
authority.

Peer-to-Peer · The direct networking of two or more

computers with each other without a centralized third-
party acting as an intermediary. Blockchains run on Peer to
Peer networks, i.e., decentralized networks. Peer-to-peer/
Two users interacting directly without a third party or
intermediary.

Protocol · The software that links the blocks together and

provides the rules under which new blocks are added to
the decentralized network.

Algorithm · The recipe, or formula, used to generate keys

that keep transactions secure. Cryptocurrencies rely on three
main keys: Hash, Public Key and Private Key (see below).
 Encryption · The process by which legible text is converted
into illegible text called a hash or a key by use of an
algorithm. This process, also known as cryptography, is the
origin of the name cryptocurrencies.

Hash · A string of letters and numbers that represents a

veri ed and submitted transaction. It is usually called Hash
or TxID. A Hash is a unique string of numbers and letters
that identify blocks and are tied to crypto buyers and sellers.

Hash Rate · The speed at which a computer veri es and

submits a transaction, thereby generating a new Hash. It is
literally the average speed at which a blockchain creates
new Hashes, and is calculated in units of hash/second.

Public Key · A string of letters and numbers which

identi es the address of your wallet in the Blockchain. This
information is shareable with others in order to receive
cryptocurrency, just like your email address or bank account
number. Public Key/Your wallet’s address, which is similar
to your bank account number. You can share your public
wallet key with people or institutions so they can send you
money or take money from your account when you
authorize it.

Private Key · A string of letters and numbers which unlocks

your wallet. This is personal information and must never be
shared, just like your password or PIN. The encrypted code
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that allows direct access to your cryptocurrency. Like your
bank account password, you should never share your
private key.

Seed Phrase · A 12, 18, or 24-word phrase that you and

only you have access to and which acts as a backup to your
private keys. If you forget or lose your private key, a seed
phrase will help you recover it. A seed phrase is a series of
words generated by your cryptocurrency wallet that give
you access to the crypto associated with that wallet. Think
of a wallet as being similar to a password manager for
crypto, and the seed phrase as being like the master
password. As long as you have your seed phrase, you’ll have
access to all of the crypto associated with the wallet that
generated the phrase — even if you delete or lose the
wallet.

Wallet (review) · A le in the blockchain that stores and

receives your cryptocurrency, just like your email inbox
receives and stores emails. It is operated by both a Public
Key and a Private Key.

Hot Wallet · A software-based cryptocurrency wallet

connected to the Internet. While more convenient for
quickly accessing your crypto, these wallets are a bit more
susceptible to hacking and cybersecurity attacks than of ine
wallets — just as les you store in the cloud may be more
easily hacked than those locked in a safe in your home.
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 Cold Wallet/Cold Storage · A secure method of storing
your cryptocurrency completely of ine. Many cold wallets
(also called hardware wallets) are physical devices that look
similar to a USB drive. This kind of wallet can help protect
your crypto from hacking and theft, though it also comes
with its own risks – like losing it, along with your crypto.

Mining · The process by which transactions are veri ed by

a computer or a group of computers. When all the
computers on the network accept the transaction, two things
happen: a new block is added to the chain and new coins
are created and added to the new block. Mining is the
process whereby new cryptocurrency coins are made
available and the log of transactions between users is
maintained.

Consensus · The algorithm by which transactions are

veri ed and submitted. The main types of consensus
algorithms are Proof of Work (PoW), Proof of Authority
(PoA) and Proof of Stake (PoS).

Mempool · A collection of veri ed and submitted

transactions that are waiting to be con rmed by all
computers in the Bitcoin network; a "waiting area" for valid
blocks. A high mempool size indicates congestion; a traf c
jam of blocks waiting to be added to the blockchain.

Proof of Work (PoW) · An algorithm that enables multiple

computers in a blockchain to compete to mine blocks. The
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 rst computer to mine a block must prove that it has used a
certain amount of energy to do so before the new block is
accepted by all the other computers in the blockchain.

Proof of Authority (PoA) · An algorithm that gives a trusted

computer or a speci c group of trusted computers the
authority to mine blocks. This is a much faster method than
PoW.

Proof of Stake (PoS) · An algorithm that allows a computer

to mine blocks in proportion to how many coins it holds.
For instance, a computer that owns 2% of the coins
available can mine a maximum of 2% of all blocks.

Proof of Activity (PoA) · An algorithm that uses both Proof

of Work (PoW) and Proof of Stake (PoS) to verify
transactions. The system starts with PoW and then switches
to PoS after a block is successfully added.

Proof of Burn (PoB) · An algorithm that allows computers to

mine blocks based on how many coins they "burn". Coins
are burned by sending them to an unspendable address. The
more coins burned, the more chances to mine.

Non-Fungible Token (NFT) · A le that is stored within a

block and which cannot be copied or replaced, meaning
each NFT is as unique as a ngerprint. This is why NFTs are
attached to digital assets, such as a JPEG picture or a digital
painting, to prove ownership of the asset or provide access
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 to the asset. Non-fungible tokens (NFTs) are a kind of
cryptoasset in which each token is unique. They can be
used to authenticate ownership of digital assets. Non-
fungible Tokens (NFTs) Non-fungible tokens are units of
value used to represent the ownership of unique digital
items like art or collectibles. NFTs are most often held on
the Ethereum blockchain.

Stablecoin or Digital Fiat · A stablecoin pegs its value to

some other non-digital currency or commodity. A digital
at represents a at, or government-backed currency on the
blockchain. (Example: Tether, which is pegged to the U.S.
dollar) Fiat Currency is currency that is created by a
government and circulated via banks. In contrast,
cryptocurrencies are invented within computers and are
circulated via a peer-to-peer network, i.e., a blockchain.

Node · A computer that is part of a blockchain. A

blockchain is therefore a network of nodes. A Node is a
computer that connects to a blockchain network.

Faucet · A reward system on a website or app that offers

free cryptocurrency for signing up or completing certain
tasks. Some of these offers (not all) are scams and one must
be careful before they sign up or share any data.

Whale · People or entities that hold a huge number of

coins of a particular cryptocurrency. In Bitcoin, the
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 minimum number of coins needed to qualify as a Whale is
1,000. Smaller holders are called a Dolphin or a Fish.

Nonce · A random number that is generated and used only

once to verify new blocks. When a block is submitted, a
nonce is attached to it to con rm that it is indeed a new
block and not an old block being re-submitted to the chain.

Smart Contracts · Pieces of code that live within the

blockchain whose purpose is to execute on a logic that the
developer has programmed. When certain information is
submitted to the blockchain, the code does what it is
programmed to do; for example, make a payout.

Solidity · The programming language used to create

Ethereum-based smart contracts.

Oracle · A piece of code that takes data from multiple

sources both inside and outside the blockchain, then
veri es, analyses and feeds the results into a smart contract
for further action. Smart contracts rely on data from oracles
to perform actions.

Chain Linking · The process of linking two different

Blockchains, for example Bitcoin and Ethereum, so that
crypto coins can be transferred between them. For a
successful transfer, the transaction must be recorded and
veri ed in both blockchains at the same time.
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 Block Explorer · A search engine that enables you to
participate in blockchain transactions and provides access
to data in blockchains. Examples include blockchain.com,
blockstream.info, blockexplorer.com, blockcypher.com and
btc.com.

Altcoins · Because Bitcoin was the rst cryptocurrency, any

cryptocurrency that is not Bitcoin (like Ethereum, Litecoin
and Cardano) is called an altcoin. There are thousands of
altcoins; some legitimate, while others are used as conduits
of nancial crime. Any coin that’s not Bitcoin. Altcoins can
be anything from the second-most popular coin, Ethereum,
to any of the thousands of coins with very minimal market
value. Experts say you should largely stick to the bigger,
more mainstream cryptocurrencies as an investment.

Decentralized Finance (DeFi) · A nancial service that is

based on blockchains and relies on smart contracts to
facilitate access to nancial and banking services. Because
DeFis are automated, they provide everyone with access to
services that were previously exclusionary. Decentralized
Finance (DeFi) Financial activities conducted without the
involvement of an intermediary, like a bank, government, or
other nancial institution.

Exchange · A website that enables you to exchange

cryptocurrency for at currencies like dollars or euros,
exchange at currency for cryptocurrency, or trade one
cryptocurrency for another.
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 Coinbase · A popular centralized cryptocurrency exchange.
Coinbase made history recently as the rst cryptocurrency
exchange to go public on the Nasdaq.

Bitcoin · The rst cryptocurrency. Launched in 2009, it was

the rst-ever crypto coin and remains the most valuable and
largest cryptocurrency. The rst and most valuable
cryptocurrency, launched on Jan. 3, 2009. While its value
has climbed steadily since then, it has seen wild
uctuations. In the past months alone, the price of Bitcoin
has uctuated from a record high of $60,000 to below
$30,000. Bitcoin which launched in 2009, established the
world's rst decentralized digital asset. Bitcoin uses
blockchain technology to create a digital asset that is
entirely decentralized and managed across a wide network
of computers rather than by a single entity.

Halving · A feature written into Bitcoin’s code in which after

a certain number of blocks are mined (typically every four
years) the amount of new Bitcoin entering circulation gets
halved. The halving can have an impact on Bitcoin’s price.

SATS · The smallest unit of Bitcoin, equivalent to

0.00000001 BTC. SATS, also known as Satoshi's, refer to
Satoshi Nakamoto, the alleged creator of bitcoin.

Bitcoin Cash · A peer-to-peer electronic cash system that

formed from a fork of the original Bitcoin. Where Bitcoin is
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widely accepted as too volatile to be useful as a currency,
Bitcoin Cash is designed to be better optimized for
transactions.

Ethereum · The second largest cryptocurrency by trade

volume, Ethereum is a crypto network and software platform
that developers can use to create new applications, and has
an associated currency called ether. Ethereum · Ethereum is
a blockchain based on its own coin called Ether. Unlike the
Bitcoin blockchain, Ethereum allows decentralized
applications to be built onto it, which enables Ethereum to
go beyond mining and offer other functions such as
decentralized nancial services, games and all kinds of
decentralized apps.

Ether (ETH) · The native cryptocurrency of the Ethereum

network. However, Ethereum accepts other
cryptocurrencies, including Bitcoin.

Gwei · The smallest unit of an Ether. 1 gwei is equal to

0.000000001 ETH (10-9 ETH). Accordingly, 1 ETH is
equivalent to 1 billion gwei.

Smart Contract (review) · An algorithmic program that

enacts the terms of a contract automatically based on its
code. One of the main value propositions of the Ethereum
network is its ability to execute smart contracts.
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Initial Coin Offering (ICO) · A way that funds are raised for
a new cryptocurrency project. ICOs are similar to Initial
Public Offerings (IPOs) of stocks.

Gas · The fee a miner earns for verifying and submitting

transactions on the Ethereum network. Requiring Gas for
every transaction prevents hackers from clogging Ethereum
with invalid transactions. Gas is a fee that developers have
to pay to the Ethereum network in order to use the system.
Gas is paid in ether, the native cryptocurrency of Ethereum.

Digital Gold · Experts sometimes compare speci c

cryptocurrencies to real gold based on the way it can store
and increase in value. Bitcoin is commonly referred to as
digital gold.

dApps (Decentralized Apps) · Apps or programs that run

on a blockchain and outside of the control of a central
authority. For example, if Twitter was a dApp, once a
message is posted, no one could delete it, including Twitter.
Decentralized Applications (DApps) Applications designed
by developers and deployed on a blockchain to carry out
actions without intermediaries. Decentralized nance
activities are often completed using decentralized apps.
Ethereum is the main network supporting activities in
decentralized nance.

Fork · A split that occurs when the blockchain's algorithm is

updated. If there is disagreement amongst the different
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computers (miners) on whether to accept a new algorithm,
one group updates to the new algorithms while another
group continues to use the old, resulting in two different
blockchains with a common origin. A Fork is
when a blockchain’s users make changes to its rules. These
changes to the protocol of a blockchain often result in two
new paths — one that follows the old rules, and a new
blockchain that splits off from the previous one. (Example: a
fork of Bitcoin resulted in Bitcoin Cash).

Hard Fork · A permanent update to the blockchain.

Computers running the previous version of the blockchain
are kicked out of the updated blockchain.

Soft Fork · A permanent change to the protocol that

requires computers to update their software. Those that fail
to update remain in the blockchain, but they cannot submit
new blocks.

Market Capitalization · The total value of a cryptocurrency

is calculated by multiplying the number of coins in
circulation by the current market price of a single coin. This
number can run into the hundreds of billion or trillions of
dollars.

The Flippening · The expected date when Ethereum

overtakes Bitcoin in terms of market capitalization.
 Exchange · A website or app, for example Binance, that
allows you to open an account and buy cryptocurrencies
using bitcoins, altcoins, or at currencies like dollars or
Euros. Funds are sent to your account via the usual
methods, e.g., PayPal or wire transfer. An Exchange is a
digital marketplace where you can buy and sell
cryptocurrency.

Arbitrage · Buying cryptocurrency on one exchange and

selling it for a higher price on another exchange.

Stablecoin · A cryptocurrency whose value is attached to

the value of a at currency, a commodity like Gold or
whose supply is controlled by an algorithm, thus ensuring
the value of the currency remains stable. The best known
stablecoin is Tether, the value of which is equivalent to
approximately 1 US dollar.

Memecoin · A cryptocurrency based on a joke. Memecoins

have no real-world utility and have value only because they
are considered funny by many who buy them for this
reason. The best known is Dogecoin.

Dollar Cost Averaging (DCA) · The practice of buying a

xed amount of cryptocurrency on a weekly, monthly or
annual basis regardless of price uctuations. This removes
emotions from the investment process and maintains
consistency and bene ts from price falls.
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Stacking · Staking is a way of earning rewards for holding
certain cryptocurrencies.

Candlestick Charts · Candlesticks give you an instant

snapshot of whether a market’s price movement was
positive or negative, and to what degree. The timeframe
represented in a candlestick can vary widely. Coinbase Pro,
for instance, defaults to six hours — with each candle
representing a ve-minute slice — but users can set it to be
longer or shorter. (Also worth noting: unlike stock markets,
crypto markets are open 24 hours a day. So the “open” and
“close” prices are the prices at the beginning and end of the
selected timeframe.)

Coin Mixer · A software that makes bitcoin transactions

anonymous and untraceable. It achieves this by taking one
transaction, mixing it up with others, and then sending it
back to the owner on a different address and in different
amounts.

Initial Coin Offering (ICO)(review) · The offering of a new

cryptocurrency to people in return for at currency,
bitcoins, or altcoins. Participants of the ICO hope that the
new crypto they have acquired will become widely used
and raise its value.

Anti-Money Laundering (AML) · Policies and legislation to

protect against money laundering.
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Know your Customer (KYC) · The procedures used to verify
the identity of a crypto user and link it to their wallet.

Double Spend · An attempt to send the same payment of

cryptocurrency to two different wallets.

Escrow · A third party within a blockchain, like BitPay, that

holds cryptocurrency safely until the seller receives
payment before they are released to the buyer.

HODL · A famous misspelling of "hold," this means holding

on to your cryptoassets when the market is down until
prices come back up. HODL stands for “Hold On for Dear
Life” though the term originated from a user typo on a
Bitcoin forum in 2013. It refers to a passive investment
strategy in which people buy and hold onto cryptocurrency
— instead of trading it — in the hopes that it increases in
value.

FOMO (Fear of Missing Out) · Selling other assets to buy

into a cryptocurrency whose value is rising.

FUD (Fear, Uncertainty, and Doubt) · FUD is usually

existent in those outside the crypto community.

Rekt · Borrowed form wrecked, meaning suffering

devastating losses.
 Bull Market · An extended period during which the price of
a cryptocurrency is rising

Mooning · A cryptocurrency whose price is skyrocketing—

going to the moon due to a long bull market run.

Pump and Dump · The practice of buying a cryptocurrency

in large numbers to drive up its price and encourage others
to invest, then selling all of it when the price rises and
there is a pro t to be made.

Shill · Someone who promotes an altcoin so that they can

personally bene t when it rises in value.

Bear Market · An extended period during which the price

of a cryptocurrency is falling.

Bagholder · An investor that holds a coin that is worth

signi cantly less than they paid for it.

Capitulation · Selling a cryptocurrency at a signi cant loss

due to loss of hope that its value will ever go up.

White Paper · A document that explains to potential users

of a blockchain the various aspects of the blockchain and
how it will work. A white paper precedes the launch of a
blockchain.
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Market Capitalization · For cryptocurrency, market cap
refers to the total value of all the coins that have been
mined. You can calculate a crypto’s market cap by
multiplying the current number of coins by the current value
of the coins.

51% Attack · This refers to a computer or group of

computers having the ability to verify more than 50% of all
transactions in a network. This enables them to reverse
transactions, spend coins more than once, and manipulate
which blocks are added and which are not.

Genesis Block · The rst block of a cryptocurrency ever

mined.

A bit of trivia · Satoshi Nakomoto · The pseudonymous

creator of Bitcoin. No one knows the true identity of
Nakomoto, or if it’s more than one person.

A bit of trivia · Vitalik Buterin is the programmer who

invented Ethereum in 2015.
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