Blockchain 101
One of the hardest things about learning about a new technology or industry is understanding the new slang and associated acronyms. Our team at Switch understands this frustration. So, to make your blockchain and cryptocurrency learning curve less daunting, we have compiled a glossary of terms and acronyms for you. This is by no means a comprehensive list, but hopefully, it will serve as a helpful starting point. If you would like to dive deeper, CoinMarketCap has a very detailed glossary of terms available here.
Blockchain:
A distributed digital ledger system. A sequence of blocks, or units of digital information, stored in time-stamped transactions in a public database. The structural basis for cryptocurrencies.
Bitcoin:
Bitcoin (BTC) is a virtual or digital currency that can be traded on a decentralized peer-to-peer network. Bitcoin was the first type of Cryptocurrency and is still the most popular. Bitcoin transactions are verified through cryptography and recorded in a decentralized public ledger called a blockchain.
Cryptocurrency:
Cryptocurrency is any form of digital money that is based on blockchain technology. Bitcoin is the most popular and first cryptocurrency, but now more than thousands of different cryptocurrencies exist. All Bitcoin is Cryptocurrency but not all Cryptocurrency is Bitcoin.
DAO (decentralized autonomous organization):
An organization whose rules are automated or developed by consensus among the members. It is designed to work unlike a typical corporate structure by utilizing the power and democratization of the decentralized community of members.
Fiat:
Government-backed Money (US Dollar and Euro are examples).
Gas Fees:
The fees paid by users to compensate for the amount of computing energy needed to verify a transaction on the Ethereum network. They are intended to prevent bad or malicious actors from spamming the network. Prices can rise and fall depending on demand.
KYC (Know Your Customer):
KYC is a procedure in which a business verifies the authenticity of their customers by verifying their background and identity
NFT (Non-Fungible Token):
A digital collectible that uses blockchain technology to verify ownership transactions.
Seed (or Recovery) Phrase:
A list of randomly generated words when you set up a wallet with an online exchange. These are the keys to accessing your account if you lose your phone or other device hosting your wallet. Write these down and protect them as they are your private keys to verify your identity on the blockchain.
Transaction Hash:
Transaction Hash, also known as Txn Hash or Transaction ID, is a string of numbers and/or letters given to each transaction made on any blockchain. Any time you send or receive currency, either Fiat or Cryptocurrency, a unique ID is created to trace the transaction. The Transaction Hash is used to track the status of its related transaction or locate funds. Transaction Hash contains no personal information so it is completely safe to share
VPS (Virtual Private Server):
A VPS is a service where you can rent private space on a server for either storage or to use its computing power.
Wallet:
Your digital wallet is where you store your cryptocurrencies, Fiat and other digital rewards. From your digital wallet you can store, send to other digital wallets or spend your different assets.
