Address | A string of characters that represents the location of a particular cryptocurrency wallet on a blockchain. Addresses can be used to send and receive cryptocurrency transactions. |
Algorithm | A set of rules or procedures that are used to solve a specific problem or complete a specific task. In the context of cryptocurrencies, algorithms are used for mining, consensus, and other purposes. |
Altcoin | Any cryptocurrency that is not Bitcoin. Altcoins are often designed to offer alternative features or benefits compared to Bitcoin, such as faster transaction speeds or more advanced privacy features. |
ASIC | An Application-Specific Integrated Circuit, or ASIC, is a specialized computer chip that is designed for a specific purpose, such as cryptocurrency mining. ASICs are designed to be more efficient and powerful than general-purpose computer hardware for specific tasks. |
Atomic swap | A type of cryptocurrency transaction that allows for the simultaneous exchange of two different cryptocurrencies between two parties, without the need for a centralized exchange. |
Backward compatibility | The ability of a newer version of a technology to work with older versions. In the context of cryptocurrencies, backward compatibility allows newer versions of a blockchain protocol to communicate with and use data from older versions. |
Block | A group of cryptocurrency transactions that have been verified and recorded on a blockchain. |
Block chain | A distributed ledger of transactions that is secured through cryptography and is maintained by a network of nodes. Each block in a blockchain contains a record of several transactions, and new blocks are added to the chain as transactions are verified. |
Block explorer | An online tool that allows users to view and search transactions on a blockchain. Block explorers provide information such as transaction amounts, wallet addresses, and confirmation times. |
Block header | The first part of a block in a blockchain, which contains metadata about the block, including the hash of the previous block, the timestamp of the block, and a unique identifying number called a nonce. |
Block reward | The amount of cryptocurrency that is given to the miner who successfully mines a new block on a blockchain. The block reward is usually comprised of newly-created coins, as well as any transaction fees associated with the transactions in the block. |
Blockchain consensus | The process by which the nodes in a blockchain network agree on the state of the blockchain. This is typically achieved through a consensus algorithm, which ensures that all nodes have the same copy of the blockchain. |
Bloom filter | A data structure used in cryptocurrency wallets to improve privacy and reduce the amount of data needed to be stored. Bloom filters allow a wallet to check whether a particular transaction or address is included in the blockchain without having to download the entire blockchain. |
Brain wallet | A type of cryptocurrency wallet that is generated from a passphrase or seed phrase that is memorized by the user. Brain wallets are not recommended due to their susceptibility to brute force attacks. |
Centralized exchange | A cryptocurrency exchange that is operated by a centralized entity, such as a company or organization. Centralized exchanges are typically easier to use and offer more features than decentralized exchanges, but they also have higher security risks. |
Cold storage | A method of storing cryptocurrency offline, typically on a hardware wallet or paper wallet, in order to reduce the risk of theft or hacking. |
Confirmation | The process by which a cryptocurrency transaction is verified and added to the blockchain. Confirmation typically involves several nodes on the network verifying the transaction and adding it to a new block on the blockchain. |
Consensus algorithm | A protocol used by blockchain networks to ensure that all nodes on the network agree on the state of the blockchain. Consensus algorithms typically involve a process by which nodes compete to validate new blocks and are rewarded with cryptocurrency for doing so. |
Cryptography | The practice of using mathematical algorithms and protocols to secure communication and data. Cryptography is an important part of blockchain technology, as it is used to secure transactions and prevent fraud. |
Cryptocurrency | A digital or virtual currency that uses cryptography for security and operates independently of a central bank or government. Cryptocurrencies can be used for online transactions and are often designed to be decentralized and transparent. |
DAO | Decentralized Autonomous Organization is a type of organization that operates through blockchain technology and smart contracts, where decision-making and governance are decentralized and automated. |
DAG | Directed Acyclic Graph is a type of data structure used by some cryptocurrencies, where transactions are linked in a directed graph instead of a linear chain. |
Decentralized exchange | A cryptocurrency exchange that operates on a decentralized network, allowing users to trade directly with each other without the need for a centralized intermediary. |
Difficulty | A parameter in blockchain networks that determines how difficult it is for miners to add a new block to the blockchain. Difficulty is usually adjusted periodically in order to maintain a consistent rate of new block creation. |
Digital signature | A mathematical scheme used to verify the authenticity of a digital document or message. Digital signatures are an important part of blockchain technology, as they allow for secure and verifiable transactions without the need for a trusted intermediary. |
Double spend | A type of attack on a blockchain network where an individual attempts to spend the same cryptocurrency twice. This is prevented by the consensus algorithm, which ensures that transactions are verified and added to the blockchain in a consistent manner. |
Dust transaction | A transaction on a blockchain network that involves a very small amount of cryptocurrency. Dust transactions are often used for testing purposes or to fill small amounts of leftover cryptocurrency in a wallet. |
Ethereum | A blockchain network that allows for the creation of decentralized applications through the use of smart contracts. Ethereum is known for its ability to support complex smart contracts and decentralized autonomous organizations. |
Faucet | A website or app that gives out small amounts of cryptocurrency for free. Faucets are often used to introduce new users to a cryptocurrency network and to incentivize participation in the network. |
Fork | A split in the blockchain network that occurs when a group of nodes decides to follow a different set of consensus rules than the rest of the network. Forks can be temporary or permanent and can result in the creation of a new cryptocurrency. |
Genesis block | The first block in a blockchain network, which is often hardcoded into the network's software. The genesis block contains no transaction data and serves as the starting point for the blockchain. |
Halving | A process that occurs in some blockchain networks where the block reward for mining new blocks is reduced by half at regular intervals. This is done to limit the total supply of the cryptocurrency over time. |
Hash function | A mathematical function that takes in input data of arbitrary length and outputs a fixed-length string of characters. Hash functions are used extensively in blockchain technology to create unique digital fingerprints of transactions and blocks. |
Hash rate | The computational power of a blockchain network, typically measured in hashes per second. A higher hash rate indicates a greater level of computational power and a more secure network. |
Hard fork | A type of fork in a blockchain network where the rules for validating new blocks are changed, making the new blockchain incompatible with the old one. This can result in the creation of a new cryptocurrency. |
HODL | A slang term used in the cryptocurrency community to refer to holding onto cryptocurrency rather than selling it. The term originated from a typo of the word "hold" in a forum post and has since become a popular meme. |
Hot wallet | A type of cryptocurrency wallet that is connected to the internet and is therefore more susceptible to hacking and theft. Hot wallets are typically used for storing small amounts of cryptocurrency for day-to-day transactions. |
ICO | Initial Coin Offering is a type of fundraising campaign in which a new cryptocurrency is offered to investors in exchange for existing cryptocurrencies or fiat currency. ICOs have become a popular way for new cryptocurrency projects to raise capital. |
Input | A component of a transaction on a blockchain network that represents the source of the cryptocurrency being sent. Inputs typically consist of one or more unspent outputs from previous transactions. |
Key | A piece of data used to access and control a cryptocurrency wallet. Keys are typically generated through cryptographic algorithms and are used to sign transactions and prove ownership of cryptocurrency. |
Lightning network | A layer-2 scaling solution for Bitcoin and other blockchain networks that enables faster and cheaper transactions by conducting most transactions off-chain. |
Limit order | A type of order on a cryptocurrency exchange in which a trader specifies a maximum price they are willing to buy or a minimum price they are willing to sell a cryptocurrency. The order will only be executed if the market price reaches the specified limit. |
Liquidity | The degree to which a cryptocurrency or other asset can be bought or sold in the market without affecting its price. Higher liquidity typically means that transactions can be executed more quickly and at a smaller spread between bid and ask prices. |
Mining | The process of using computational power to validate transactions and add new blocks to a blockchain network. Miners are rewarded with cryptocurrency for their contributions to the network's security. |
Miner | An individual or organization that participates in the mining process on a blockchain network. Miners use specialized hardware and software to validate transactions and add new blocks to the blockchain. |
Node | A computer or other device connected to a blockchain network that participates in the validation and storage of transaction data. Nodes can be either full nodes, which store a complete copy of the blockchain, or lightweight nodes, which store only a subset of the blockchain data. |
Nonce | A number that is included in the block header during the mining process to ensure that the hash of the block meets the target difficulty. Miners increment the nonce until a valid hash is found. |
Off-chain transaction | A type of transaction that occurs outside of the blockchain network, often through the use of a layer-2 scaling solution such as the Lightning Network. Off-chain transactions can be faster and cheaper than on-chain transactions, but are less secure. |
Output | A component of a transaction on a blockchain network that represents the destination of the cryptocurrency being sent. Outputs typically consist of one or more public addresses that can receive cryptocurrency. |
P2P network | A type of network architecture in which participants communicate directly with one another rather than through a centralized server. Blockchain networks are typically organized as P2P networks, allowing for decentralized validation and storage of transaction data. |
Paper wallet | A type of cryptocurrency wallet that stores the private key and public key information on paper rather than on a computer or other digital device. Paper wallets are typically used for long-term storage of large amounts of cryptocurrency. |
Proof-of-stake | A consensus algorithm used by some blockchain networks in which validators are selected based on the amount of cryptocurrency they hold and are willing to "stake" as collateral. Validators are then rewarded with transaction fees rather than with newly minted cryptocurrency as in proof-of-work systems. |
Proof-of-work | A consensus algorithm used by some blockchain networks in which validators (miners) compete to solve complex mathematical problems using computational power. The first miner to solve the problem is rewarded with newly minted cryptocurrency and the block containing the solved problem is added to the blockchain. |
Public key | A piece of data used to receive cryptocurrency and to verify digital signatures on a blockchain network. Public keys are typically derived from private keys using mathematical algorithms and are publicly available. |
Segregated Witness | (SegWit) A protocol upgrade implemented on the Bitcoin blockchain in 2017 that separates transaction data and signature data in a block, allowing for more transactions to be included in each block and improving the efficiency and scalability of the network. |
SHA-256 | A cryptographic hash function used in Bitcoin and many other blockchain networks to secure transaction data and validate blocks. SHA-256 produces a fixed-length, 256-bit output from any input data. |
Sidechain | A separate blockchain that is connected to a main blockchain, allowing for the transfer of assets between the two chains. Sidechains can be used to implement new features or applications without affecting the main blockchain. |
Signature | A piece of data created using a private key that is used to verify the authenticity of a transaction on a blockchain network. Signatures are essential to the security and validity of blockchain transactions. |
Soft fork | A type of blockchain protocol upgrade in which the new rules are compatible with the old rules, allowing nodes running the old software to continue operating normally. Soft forks typically require a majority of network participants to signal their support before |