- Proof of Stake (PoS)
Over time, the reward due to miners will decline or drop to zero, as most cryptocurrencies are finite in supply. When this happens, miners will not be motivated to validate transactions on the blockchain. The PoS consensus method solves this issue by allowing miners to validate transactions in proportion to the number of coins they hold and are rewarded with transaction fees. A miner with more coins will therefore have more mining power.
- Proof of Work (PoW)
PoW is proof required of miners to show they actually performed the necessary activities to validate a transaction. It is difficult and time consuming yet easy to verify by others. In doing so, it protects the blockchain against attacks and also prevents an originator of a transaction from double spending. The SHA-256 is the most widely used PoW algorithm in the cryptospace.
- Pump and Dump
Pump and dump is a popular money-making mechanism in the cryptocurrency space. A group of people decide to buy a specific coin or token with a low market capitalization at a particular time. This increases the value of the coin or token- Pump. These individuals benefit from selling the coins or tokens at its peak-dump. When the overvalued coins or tokens are being sold, their prices show a more accurate market capitalization.
This is short for “satoshi’s”. A term derived from the the name of the bitcoin creator(s) satoshi Nakamoto. It is the smallest fraction of a bitcoin that can be sent, which is 0.00000001 of a bitcoin. Traders look at bitcoins in terms of sats or satoshis traders look at sats, or satoshis.
This involves creating extensive publicity about a new coin urging people to invest in it, in order to increase its value.
This refers to an altcoin that has become worthless.
- Soft Cap
This is the minimum amount that an initial coin offering (ICO) needs to raise. If the ICO is unable to raise that amount, it may be cancelled and the collected funds returned to participants
- Total supply
This refers to the total amount of a cryptocurrency in existence. When a cryptocurrency is created, the developers usually hold on to an amount of coins. Total supply of a coin is the sum of a coin’s circulating supply and that held by the developers.
Wallets are generally digital software programmes where you can store, send and receive cryptocurrencies. The currencies are not physically stored in a wallet, rather, private and public keys which are unique to each account holder are stored. Public keys can be accessed or viewed by anyone on the blockchain whereas a private key is required to authorise transactions to and from a wallet. There are three types of wallets: software, hardware and paper. Software wallets can be online, on a desktop or mobile. Paper wallets are printouts of the keys or softwares which allow you to generate the keys. Hardware wallets include USB’s. The different types of wallets have differing levels of security. Also, unlike accounts held with an exchange, wallets are not linked to a holder’s identity.
The whale is the biggest creature in the ocean has the tendency to overpower smaller creatures. In the context of cryptocurrency, this refers to an individual or a group of people who own a large percentage of a particular cryptocurrency and can use it to their advantage to manipulate the price of that cryptocurrency in the market.