Cryptocurrency trading according to global financial outfits is the future of trading. With over a million investors in the market trading already, there is no denying the continuous influx of new entries into the market every single second. If you happen to be new to the cryptocurrency market, it is better I let you know that just like stock or forex trading, this market has embedded terms. These terms over the years have increased, with everyday seeing the invention of new ones. Most people ask me why the cryptocurrency market space is saddled with so much terms, and I am always like, ‘It is an open source trading network. Anybody can introduce new terms.’ However, among these terms, there are terms that I refer to as global terms. These terms are a must know for anybody that is looking forward to trading in the cryptocurrency trade. These terms aren’t the common terms that everyone is familiar with; they are mostly used in the course business. I have taken my time to do my research, and I have presented to you, the top five cryptocurrency terms you should never forget.
A cryptocurrency address is not necessarily different from your typical home address. It is simply the point at which a cryptocurrency owner will receive, send or save his currency. A typical address contains a long string of identifiers made up of 26-35 alphanumeric characters. An address can be generated at no cost, and there are basically three types of addresses. The first of its kind is the P2PKH, which starts with the number 1. The second is P2SH with an initial number of 3. And the last one is the Beach32 with bc1 as its initial string character.
A 51% attack happens when the computing power on a cryptocurrency network is operated by an individual, a group of company or a concentrated group of body. Such occurrence gives them the total control of the cryptocurrency network. For a system network on 51% attack, the individuals that control the network have the power to halt all mining. They also possess the power to use a coin over and over again. And they can manipulate interpersonal transactions. A 51% attack is hard to pull-off, however it is possible. But the damage one could cause with such attack is small, but it can threaten the existence of that coin, causing panic among investors and traders.
Fork happens when a certain blockchain splits into two chains. It is a permanent divergence which comes into existence mostly when a 51% attack occurs. It also springs to existence when bug is discovered in the system, or when new rules involving the a particular coin comes into play. There are basically two types of forks; the soft fork and the hard fork. Hard fork happens when the update of the platform makes old rules obsolete. Soft fork occurs when the platform are make backward-compatible.
PoW (Proof of Work) was originally designed to solve the issue of spam emails, sieving them and preventing clients from attacks. It is a requirement needed in defining computations and mining that needs to done, in order to create a whole new group of trust-less transactions. PoS (Proof of Stake) is an improvement of PoW. It is an algorithm used in the blockchain of a chain network, used for distributed consensus. The concept behind PoS is that the more the coins you hold, the more your power of mining or validating block transactions.
If you are familiar with forex trading, these terms wouldn’t be new to you. However, bearish or bear market is a term that is used to signify a market on the decline. It is said to behave exactly the same way as a bear, when it is in a fight as it pushes its opponent down to the ground. Normally in crypto charts, a bear market is signified by the color red. On the other hand of the spectrum is the bullish or bull market. The term also comes from bull fights, the bull throws its opponent to the air with its horns. So a bull market therefore signifies a market on the rise, with stability and confidence.