Crypto basics for noobs
This Cryptocurrency for beginners article explains everything you need to know to get you started with crypro investing. What is cryptocurrency? Cryptocurrency is virtual money or a digital asset that uses cryptography to secure transactions. There are over 1400 different cryptocurrencies of whitch Bitcoin is the most known.
Before we continue… if you do decide to invest in cryptos and you are not planning on trading them anytime soon, put your cryptos on a hardware wallet! A wallet is the safest way to keep your virtual money secure. There are a lot of wallets available but make sure you buy them directly from the vendor and never second hand or from a shady dealer. Good brands are Trezor and Ledger. I use a simple Ledger Nano. Visit the Ledger website and see if there is a product that suits your needs.
Common Crypto Terms and Abbreviations
Cryptocurrency for beginners is mostly about understanding the terminology that us used in the crypto space. If you understand these terms and abbreviations suddenly, everything becomes clear.
| Address | String of alphanumeric characters that is used to do transactions between wallets |
| Alt Coins | Any cryptocurrency other than bitcoin |
| AML | Anti-Money Laundering laws |
| Arbitrage | Taking advantage of a price differences of the same coin on different exchanges |
| ASIC | Application Specific Integrated Circuit. Chip used in mining |
| ATH | All Time High |
| Bagholder | Person holding an altcoin after a pump and dump |
| BBS | Battered Bull Syndrome |
| Bearish | Expectat decrease in price |
| BFX, Finex | BitFinex |
| Block Height | Block height is the number of blocks preceding the genesis block (first block) on the chain |
| Block Reward | Reward for solving the mathematical equation related to a block |
| blockchain | Distributed ledgers, secured by cryptography |
| Bollinger Band | A margin around the price of a crypto that helps indicate when a coin is overbought or oversold |
| BTFD | Buy the Fucking Dip |
| Bullish | Expectat increase in price |
| C&H | Cup and Handle chart pattern |
| CB | Coinbase |
| Circulating supply | The number of coins or tokens that are circulating in the market |
| cold storage | Offline wallet |
| Core | Bitcoin developers |
| DCA | Dollar Cost Averaging |
| Decentralized | A state where there is no central contro to infrastructure |
| Distributed consensus | Collective agreement by various computers in a network |
| Exchange | Websites where you can buy and sell crypto-currencies |
| FIAT | Government-issued currency |
| Fib | Fibonacci retracement |
| FOMO | Fear of Missing Out |
| FOMO | Fear Of Missing Out |
| Fork | Blockchain split into two separate chains |
| FUD | Fear, Uncertainty, and Doubt |
| FUDster | Person spreading FUD |
| H&S | Head and Shoulders chart pattern |
| Halving/halvening | Reference to the reduction in the mining supply, which occurs every four years |
| Hodl | Holding coins long term rather than trading regularly. Typo for hold |
| ICO | Initial Coin Offering |
| KYC | Know Your Customer laws |
| lambo | Car that stands for getting rich in crypto |
| Lightning Network | A low latency, off chain P2P system for making micropayments of cryptocurrencies |
| Long | Buy, typically on margin |
| MACD | Moving Average Convergence Divergence |
| Market Cap | Total value held in a crypto-currency |
| Mining | Using processing power |
| Mooning | Price goind up astronomical |
| Node | A computer that has a copy of the blockchain |
| P/L, P&L, PNL | Profit and Loss |
| P&D | Pump and Dump |
| Polo | Poloniex |
| PoS | Proof-of-stake |
| PoW | Proof-of-work |
| Rekt / wrecked | In a losing trade |
| ROI | Return on Investment |
| Satoshi | 0.00000001 BTC. The smallest unit of a Bitcoin |
| Satoshi Nakamoto | Creator(s) of Bitcoin |
| Segregated Witness (SegWit) | Increased block size limit by removing digital signature data and moving it to the end of a transaction to free up capacity |
| sharding | Scaling solution for blockchains |
| Shilling | Promoting a coin |
| Short | Sell on margin |
| Stamp | BitStamp |
| Stop | Stop-loss order |
| TA | Technical Analysis |
| Tokens | Tokens are a representation of a particular asset or utility, that usually resides on top of another blockchain |
| TX | Transaction |
| Whale | A single entity either selling or buying large sums |
| Whitepaper | A document that describes the philosophy, objectives and technology of a project |
Learn trading Cryptocurrency for beginners
Learn how to trade cryptocurrencies with technical analysis. The Japanese began using TA (technical analysis) to trade rice in the 17th century using candlesticks. A candlestick is a visual representation of some data that happens in between a given time frame.
How to read candlesticks? The wick, line below and above the body, represents the complete price movement within a certain time. The body represents the open and closing price within a certain time. If the closing price is lower than the opening price, the candle is bearish (red / decrease in value) and if the closing price is higher than the opening price the candle is bullish (green / increase in value).
The patterns described in the candlestick cheat sheet below can help you identify price movements.
Tone Vays explains candlesticks, bullish and bearish patterns on his website Liberty Life Trail.
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