Blockchain

Bitcoin Terms -TamilBTC

Bitcoin Terms

With the introduction of Bitcoin came many new terms to describe different aspects of cryptocurrency and blockchain technology. As with any new invention, you’re bound to come across an unfamiliar word as it grows because people are constantly coining new words or phrases.

To an ordinary person listening in on a conversation about cryptocurrency, it will likely sound like jargon. In reality, it’s comparable to stocks with all the fancy words that could actually be simplified. We’ve listed all the most popular Bitcoin terms below and have simplified their definitions to help you in your journey to understanding cryptocurrency gambling.

Address

A Bitcoin address is the equivalent of a invoice number in the cryptocurrency world. You need this to facilitate the sending and receiving of bitcoin just like with an email.

Altcoin

A decentralized peer-to-peer digital cryptocurrency like bitcoin, but with its own set of operational rules and separate blockchain.

ASIC

Application Specific Integrated Circuit. This chip was created to provide high hash rates for mining bitcoins.

Bit

A sub-unit of Bitcoin – 1 bit is the equivalent of 0.000001 BTC.

Bitcoin

The world’s first decentralized digital currency that is created (or ‘mined’) and distributed on a decentralized peer-to-peer network, debuting in 2009.

Block

A block refers to a data unit that attaches to the blockchain once confirmed via mining. Each block contains details on transactions occured within a 10 minute timeframe.

Blockchain

The blockchain is a public ledger of all bitcoin transactions that have been processed in a chronological order. This technology removes the issue of double spending which is a common issue outside of the crypto world.

BTC

Just as the US dollar has a $ symbol, you’ll usually see bitcoins represented as ‘500 BTC’.

Centralized

A middle-man is involved and control a service like a bank does.

Cold Storage

Storing private keys offline so it is safe from hackers.

Cold Wallet

A Bitcoin wallet that is not connected to the internet such as hardware wallets.

Confirmation

This indicates that a transaction has been processed and is registered in the blockchain. The more confirmations received, the less likely it can be reversed or tampered with. It’s typical that higher value transactions require more confirmations.

Cosigner

Another person who has partial control over the Bitcoin wallet.

Cryptocurrency

A broad term to identify peer-to-peer digital currencies built on blockchain technology. Cryptocurrencies do not need a bank or clearinghouse, allowing much lower fees than with currencies involving governments, banks or a centralized authority.

Cryptocurrency 2.0

A Cryptocurrency 2.0 project refers to the use of blockchain technology for a purpose other than creating and distributing currency, usually involving the decentralization of services that were previously governed by the authority of a third party.

Cryptography

The protection of data through cipher and encryption techniques. These generally concern the private keys involved with wallets.

Decentralized

Opposite of centralized, there is no middleman involved. The individual is in full control of their bitcoins.

Distributed

Bitcoin has a distributed network meaning there is no master server connecting everyone, it is composed of thousands of nodes across the globe. Everyone can connect directly with each other.

Double Spending

A double spend is when the same set of coins are spent in different transactions. To prevent cases of ‘double spending’, the blockchain will choose the oldest verifier of the conflicting entries, thus making it extremely and increasingly difficult to hack, the older and more prolific a blockchain is.

Faucet

A service that regularly provides free bitcoins typically in exchange for watching advertisements or filling out surveys.

Fiat Currency

Normal everyday currencies we currently use such as US dollars.

FOMO

Fear of missing out.

FUD

Fear, uncertainty and doubt.

Hash

A mathematical function that tags a file with a unique shortcode which can be used for identification purposes. Hashing is a huge part of the anti-tampering feature of blockchain technology.

Hash Rate

The hash rate is a measure of processing power usually used when referring to the ‘mining’ of cryptocurrencies.

Hot Wallet

A Bitcoin wallet that is connected to the internet. This refers to web wallets, desktop wallets and mobile wallets.

ICO

Otherwise known as initial coin offering, this is a medium for raising funds to source a project.

Mining

Mining is the process of solving complex mathematical problems on the Bitcoin network in order to confirm transactions by ‘hashing’ new blocks. Miners typically receive a reward (newly generated bitcoins) and also fees from the sender for this service. As more bitcoins are mined, the difficulty of this process increases and so it requires a higher hash rate.

Mt. Gox

One of the first large Bitcoin exchanges on the market. Most commonly known for the scandal involving the loss of 850,000+ bitcoins.

Multi-Signature

A transaction that requires multiple signatures before it can be executed.

Node

Nodes make up the Bitcoin network. They each contain a copy of the blockchain and share new transaction data to other nodes so everyone is updated.

Open Source

Projects with full transparency that release their software code so it’s publicly available.

Paper Wallet

A form of cold storage where your private keys are printed or written on a physical medium.

Peer-to-Peer

Directly from person to person. Blockchain technology cuts out the middleman (i.e. the bank) so people can send money to each other without the need for other people.

Private Key

A private key is an encrypted data key which allows you to spend the bitcoins on a particular wallet. It is recommended that private keys are stored carefully offline and should never be shared.

Proof of Work

A work model which requires computing power to generate data. Bitcoin uses this model to generate new blocks.

Satoshi

It defines the smallest sub-unit of Bitcoin. A single bitcoin is equal to 100,000,000 Satoshi.

Vanity Address

A personalized address.

Vault

A type of wallet with higher security measures.

Wallet

A Bitcoin wallet is the equivalent of a physical wallet. Each wallet is tied to your private key(s) that give you access to your bitcoins on the Bitcoin blockchain. Most wallets allow you to generate as many addresses as you require so you can keep transactions separated.

Whitepaper

The details, plan and projection of a project.

Zero-Confirmation Transation

When the seller sends the product even without Bitcoin transaction confirmations as a sign of trust.