7 Crypto Terms That Every Newbie Should Learn Before Trading
When a newbie joins the crypto community, it might be difficult for them to understand the terminology that seasoned traders use. Here are the definitions of the seven most popular crypto slang terms, explained in simple words.
It is a synonym for the verb “to hold”. If you hodl a coin, you are not planning to carry out any transactions with it on the exchange.
This term appeared as a result of a misprint. When cryptocurrency was still in its infancy, someone misspelled the word “hold” on a forum. Someone else believed that it was an acronym that meant “hold on for dear life”.
To the Moon
When the BTC or an altcoin is mooning, its price is growing rapidly and significantly. This expression compares the currency with a space rocket.
Pump and dump
When the price of a coin is growing as a result of someone’s deliberate actions, it is called “a pump” (someone is “pumping” the coin). If the price is decreasing, it is “a dump” (someone is “dumping” it).
Groups of traders usually plan pumps in Telegram or Slack chats. They do it to sell their coins at a high price. When people organize a dump, they do it to buy a coin at a low price — and sell it during a dump later.
It is a person who owns a lot of cryptocurrency. They have enough coins to create a pump or dump without anyone else’s help. To become a whale, one should purchase a few hundreds or thousands of BTC.
To become a bagholder, you should do the following:
- Buy cryptocurrency
- Witness a pump, a dump or another situation where you can sell your savings at a profit
- Miss your chance and earn nothing
All newbies inevitably find themselves in the bagholder’s position someday — but then they gain experience.
This abbreviation describes the emotions of a bagholder: “fear, uncertainty and doubt”. Also, it characterizes the situation on the market when the price of a coin fluctuates too drastically.
It is short for “satoshis”. 1 satoshi = 0.00000001 BTC. The first cryptocurrency was allegedly invented by a person called Satoshi Nakamoto. The smallest fraction of a Bitcoin that can be sent inherited the name of its creator.
Hopefully, this glossary came in handy and now you understand the meanings of the most basic terms of the digital trading jargon!