Important crypto trading terms and their meaning

Important crypto trading terms and their meaning

Have you ever been to a crypto conference and then you hear the speaker say things like HODL or FOMO. Sitting around you are other crypto enthusiasts who nod to everything the speaker says and then make a few notes. Everyone in the room knows and understands what the speaker just said – everyone but you. This is exactly what happens when you’re new to the crypto world and don’t yet know the important terms. This post will educate you on common crypto terms and what they mean.

Crypto terms and meanings

  • FUD – Fear, Uncertainty, and DoubtFUD
    is not necessarily a trading term, but it is used in the financial market. It is usually a strategy used to discredit a company by spreading false information about it. In the crypto space, it is often used to influence the price of a coin.

  • FOMO – Fear of Missing Out / Fear of missing out
    FOMO is a term used to describe the emotions most investors feel when they rush to buy an investment because they might miss out on profits.

  • HODL
    HODL is simply the misspelled version of the word HOLD and means much the same thing. It simply means to buy an asset and hold it for a long time. This strategy is used by many bitcoin investors.

  • ROI – Return of Investment / Yield
    ROI simply describes the profit you make from an investment you had put your money into. It is a way to measure the performance of your investment and decide if it was or is a worthwhile investment. It is a measure of return relative to the original cost.

  • ATH – All-Time High / All-time High
    ATH doesn’t sound that confusing. It is the highest price recorded for an asset. For example, Bitcoin reached an all-time high of $66,000 in the bear market of 2021. At this point, it is always best to exit the market.

  • ATL – All Time Low / All Time Low
    ATL is exactly the opposite of ATH. It is the lowest price recorded for an asset over a period of time. Many people buy the asset at this point hoping to make some money off the price increase through a HODL.

  • Wallet
    A wallet works like your physical wallet where you keep your cash. It is a digital place where you store your digital currency.

  • Exchange
    An exchange is an online platform where you can buy or sell cryptocurrencies.

  • FORK
    This is the division of a blockchain by the decision of many blockchain users. The new blockchain usually follows a new set of rules and the old blockchain follows the old rules but they both continue to run at the same time.

  • Genesis Block
    Genesis stands for the beginning. In the crypto economy, a genesis block is simply the first block of a cryptocurrency discovered through mining. There are many other terms you should familiarize yourself with as a beginner, but hopefully these will help you get your bearings a little better. Keep trading and avoid FOMO.

Leave a Reply

Your email address will not be published.