Major cryptocurrency terms and what they mean

The price of bitcoin reaches a new high level of $ 120,000 (£ 89,000) – by US President Donald Trump’s crypto -friendly trend badly – has placed the world of cryptocurrency in the spotlight.

But it also includes misleading words such as ETF, blockchain and cold wallets, which can make it somewhat difficult to navigate the subject.

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If you are listening to them for the first time, or just a refresher, then there are some major words here and what they mean.

While many people can struggle with the fine points of crypto, much more have all heard of their most famous product: bitcoin. But what exactly is it?

Bitcoin is a cryptocurrency, called a type of digital currency. Unlike traditional currencies, bitcoin is not controlled by centralized financial institutions.

This makes popular to those who think decentralization can bring financial freedom, but it makes it extremely unstable with bitcoin buyers and sellers and falls in value.

Donald Trump has promised to make America a “Crypto Rajdhani of the world” – retreating on his previous claim that bitcoin was a “scam”.

Its price tops the much awaited limit of $ 100,000 in December 2024.

In mid -July 2025, the price rose to $ 120,000, as American politicians prepared to start a debate on bills that would regulate digital assets.

But its price has been known Casual decreasing Just as soon as this spike.

Blockchain is a technology outlining all cryptocurrency, and many related products such as non-fangbal tokens (NFTs). In short, it is a virtual spreadsheet, on which all purchases and sales of crypto have been recorded. They are arranged in blocks connected together in a huge chain – so the name.

Each cryptocurrency transaction is individually recorded by a huge network of volunteers on blockchain, which confirms its authenticity using a computer program.

The encouragement to do this for the network of bitcoin is that the first person to validate the transaction is rewarded in bitcoin. This potential attractive process is also controversial Incredible amount of energy Used as people in the world, which is the first time to successfully update blockchain.

Blockchain is maintained by rewarding the so -called “miners” – whose job is to validate the transaction – by paying them with cryptocurrency.

However, unlike some other digital currencies, there is no infinite supply of bitcoins. The amount that can be mined is overshadowed at 21 million, and most are already in circulation.

So in almost every four years – or when bitcoin blockchain reaches a certain size – then the number of bitcoins rewards those who successfully validate the transaction, cut in half. The most recent bitcoin “Halling” (or “Halving”) event took place on 20 April 2024, reducing the reward from 6.25 bitcoin to 3.125 for miners.

This ensures that the supply of bitcoin is prepared for long -term demand, while in theory, increases over time. But with low awards for miners, it may also consider something that is economically meaningful for them to continue the expensive operation of running their powerful computers.

A Crypto Exchange is a digital platform where investors can buy, sell and trade cryptocurrency.

Similar to traditional investment, a crypto exchange acts as a brokerage, where people can move traditional funds, such as pounds or dollars in exchange for cryptocurrency like bitcoin or atherium. Most transactions are accompanied by fees.

A Crypto Wallet is a place where investors hold their cryptocurrency. There are two types, a hot wallet and a cool wallet.

Hot wallets are associated with the Internet, and thus more accessible to quick transfers and easy access.

Cold wallets are particularly designed USB sticks such as physical devices that offline crypto that are usually for safe and long -term storage.

The atherium is used to describe both the second largest cryptocurrency after bitcoin, depicted by ether tokens, and blockchain outlines it. It supports an array of various applications and digital assets, such as non-fungting tokens.

It acts in a similar way for bitcoin and other cryptocurrency, but in 2022 Switch to a greener operating system requiring low computers and energy,

There are ETF portfolio that allow investors to bet on many assets without purchasing themselves. Stock exchanges like shares were traded, their value depends on how the overall portfolio performs in real time. They can include a combination of gold and silver bullion, for example, or a mixture of shares in both technology and insurance companies.

A spot bitcoin ETF directly buys cryptocurrency “on the spot”, at its current price, throughout the day.

While some ETFs already indirect bitcoin, America Several spot bitcoin ETFs approved In January 2024. This allowed new investors, such as investment management firms such as Blackrock and Fidelity to enter the speculative world of bitcoin without worrying about digital wallets or to navigate the crypto exchanges.

Mem coins are a form of cryptocurrency used for fun and speculation.

They are usually made to capitalize on social media trends or viral memes – such as for the Internet -famous Pygmy hippo moo deng,

But meme coins are heavily criticized for their speculative nature and risk for investors, as they often have little possibility of accumulating price over time.

They can also be susceptible to “rug bridge” – where promoters of a cryptocurrency draw in buyers to increase the price of their coins, only to prevent trading activity and close with money raised from sale.

Some celebrities have faced backlash after launching Meme coins.

The “stable” here is an important word – this cryptocurrency is different from others because it intends to be less unstable in value.

It usually works by an existing property associated value, for example, currencies such as US dollar or pound sterling, which in principle should make them more stable in price than cryptocurrency that are not supported by assets.

Stabelin is usually controlled by companies that provide them, with transactions recorded on digital leaders. While some conducted the future of finance, High profile price collapses of stablecoins Regulators have been alerted for risk for investors and motivated them to investigate on their perceived stability.

XRP is a cryptocurrency used by a platform called XRP laser. It was designed in 2012 as a cheaper, sharp option for bitcoin by co-founders of Financial Services Company Ripple Labs.

Cryptocurrency has a certain supply of 100 billion coins, which was built on launch. Most of its parts are conducted by Ripple and released into circulation from time to time.

Unlike cryptocurrency such as bitcoin, transactions done using XRP are verified through consensus-due to which its colleague should agree to most verification on the colleague network whether or not whether the transactions are valid or not before adding the transaction to their blockchain.

It has been credited to allow several transactions to allow to be at simultaneously, high speed and low cost – it appeals to financial institutions or for procedures such as border pay payments. But with other cryptocurrency, XRP has received regulatory inquiry and has seen suddenly, sharp decline in value,