May 2

Cryptocurrency Terms You Must Know (H-L)

The ICO craze may be over, but these terms presented below are here to stay.

H

Halving: The even where the block reward of a cryptocurrency is reduced by half.
Eg. The block reward of Bitcoin was 50. This was reduced by half to 25 in 2012 , and then to 12.5 in 2016, and to 6.25 in 2020.

Hard Cap: The maximum supply of a cryptocurrency.
Eg. Bitcoin has a hard cap of 21 million.

Hardware Wallet: A cryptocurrency wallet that looks like a thumb drive.

Hash: A string of alphanumeric code which holds the details of the block in a blockchain. This can be viewed as the identity number of the block.

Hash Power or Hash Rate: The speed at which new hashes are calculated by mining computers.

High-frequency Trading (HFT): Algorithmic trading which executes a large number of cryptocurrency trades in a second.

Hold On For Dear Life (HODL): Holding onto your cryptocurrency investment for a long time, even in a bear market.

Hot Storage: The storage of cryptocurrency private keys for convenience in accessing your cryptocurrency.

Hot Wallet: A cryptocurrency wallet that’s connected to the Internet for hot storage.
Learn about which wallet suits you here.

I

Iceberg Order: An order to buy or sell a large quantity of cryptocurrency in smaller amounts.

Immutable: The inability to be changed. This is one of the most important properties of a blockchain.
To understand blockchains better, head over to this article.

Impermanent Loss: A temporary loss of funds by decentralized exchanges due to volatility.

Index: A financial instrument used to track a basket of assets.
Eg S&P500 and DJIA
What do you need to know about any market index?

Inflation: An increase in prices which leads to a fall in the purchasing power. This is the opposition of deflation.

Initial Bounty Offering (IBO): A new method of launching a blockchain project which focuses on the contribution of skills over capital.

Initial Coin Offering (ICO): A fundraising method where cryptocurrency is sold to investors in the open market.

Initial Exchange Offering (IEO): A fundraising method where cryptocurrency is listed on an exchange.
Want to know which exchange to open an account with? We compare 9 popular exchanges for you here.

Instamine: A large portion of a cryptocurrency is distributed to investors shortly after launch.

Intermediary: A middleman who brings different parties together to carry out an agreement or directive.

Internet of Things (IoT): A network of devices, sensors, and software that can collect and exchange data with each other over the Internet.
Eg smart air-con systems, wireless printers, Amazon Echo and Alexa.

Interoperability: The ability to see and access information across different blockchain systems.

Issuance: The generation of a new cryptocurrency. This can be done in several ways – airdrop, ICO, IEX, and more.

K

Know Your Customer (KYC): A questionnaire by a cryptocurrency exchange and trading platforms to help them assess and identify their customers, and prevent money laundering.

L

Latency: The time needed by the network to confirm the transaction after it has been submitted.

Law of Demand: An economics terms which specifies the willingness of consumers to buy an amount of goods or services for a particular price.

Layer 2: A framework or protocol that’s built on top of an existing blockchain to speed up transactions or reduce the transaction size.

Ledger: A digital record of financial transactions which cannot be amended.

Leverage: Money that you can borrow from trading platforms or cryptocurrency exchanges to help you increase your exposure to a cryptocurrency than what your capital permits.
Eg. If I have $20,000 and the price of Bitcoin is $50,000, I would need to borrow from my trading platform or cryptocurrency exchange if I want to buy 1 Bitcoin. I will need a 3x leverage.

Library: A collection of resources (including files, documentation, templates, and codes).

Lightning Network: A layer 2 solution to speed up the processing time of Bitcoin’s transactions.

Limit Order (Buy and Sell): An instruction which you can set for your purchase or sale of cryptocurrency at a predetermined price. Doing so frees you to do the things you need.
Eg. The price of ETH (cryptocurrency of Ethereum) is $3,000. You’d like to buy it when the price drops to $2,800, Therefore, you set a limit buy order at $2,800, and only buy if ETH hits $2,800.
Eg. The price of ADA (cryptocurrency of Cardano) is $1.50. You believe that the price of ADA will drop once it hits $2. Hence, you set a limit sell order at $2 and start selling only when ADA hits $2.

Liquidity: The ease of buying and selling a cryptocurrency without impacting its price.

Liquidity Pool: Cryptocurrencies that are kept to facilitate trading on decentralized exchanges.

Liquidity Provider: A user of decentralized exchanges providing his/her cryptocurrency to facilitate trading.

Listing: The addition of a cryptocurrency to a cryptocurrency exchange.
Which exchange has the most cryptocurrencies listed? Read this article to find out.

Long: The purchase of a cryptocurrency with the expectation of its price to increase.

Here’s What You Can Do To Improve Your Trading Right Now

#1 Register for our market outlook webinars by clicking here

#2 Join us in our Facebook Group as we can discuss the various ways of applying this by clicking here

#3 Never miss another market update; get it delivered to you via Telegram by clicking here

#4 Grab a front row seat and discover how you can expand your trading arsenal in our FREE courses (for a limited time only) by clicking here

See you around!


Here Are The Articles That Might Interest You

Loved this? Spread the word

Join Swim Trading Trade Discussion Facebook Group

Our supportive online community is the best place to learn together with others just like you.