If you plan to invest in cryptocurrencies, and you’re following Twitter feeds or other news sites that have cryptocurrency terminology that you’re unfamiliar with, our glossary of terms below will help! The term and some information around the term have been added below for your reference:
To The Moon: This term is used to signify that a specific cryptocurrency is going to skyrocket to huge earning potentials at the current moment. When an investor or news site says “XRP is going to the moon” they mean that Ripple (XRP) is going to jump to huge numbers. This is only speculation, however, because no one actually knows what will happen in the future, but if you’re reading XRP is going to the moon on multiple reputable news sources, it’s likely this would be a good investment to get into. Some choose to wait until the price dips a little before getting into the digital currency, but others will buy at any price if they feel like a surge is coming.
FOMO: Stands for “Fear Of Missing Out.” This pertains to the overwhelming sensation that a person feels when the need to hop on the bandwagon right when the price of a cryptocurrency starts to skyrocket. The fear here is that you won’t put your money into the currency and then will miss out on a huge profit. Traditionally you’d hear FOMO on a Twitter feed.
FUD: Stands for “Fear, Uncertainty, and Doubt.” This is negativity that is spread around based on no real facts or evidence solely for the intention to get the price of a currency to drop in value.
FUDster: This is the actual person that is spreading the negativity. This person spread “FUD.”
Pump And Dump, or PUMP/DUMP: This refers to the recurring cycle of an altcoin that receives a large amount of attention thereby increasing the price of it quickly, only to then be followed by a large crash. We have seen a lot of pumping and dumping recently. An example of pumping is stating that Coinbase is likely to add Ripple (XRP) to their platform even when Coinbase has not officially said anything on the matter. People get excited and start investing in XRP and then when the price starts to soar up, people start to dump their XRP for a large profit. This is a real life example.
Whale: This is a person that owns a huge amount of cryptocurrency, an amount so high you can’t even fathom owning that much.
Limit order / limit buy / limit sell: When you place a cryptocurrency order using the “limit” feature, whether buying or selling, you are indicating that you want to either buy or sell when the cryptocurrency meets a specific price, rather than whatever the market price is at that current moment. If you place a limit order to buy a cryptocurrency, but when you click the “buy” button the price continues to rise, your order will not go through until the price has come back down to meet the price you originally specified.
Market order / market buy / market sell: When you place a cryptocurrency order using the “market” feature, whether buying or selling, you are indicating that you want to either buy or sell at whatever the current market price is when your order will be filled. For instance, if you buy at a certain price, but the price is continuing to rise, your order will be fulfilled almost immediately. Similarly when the price is going down your order will be fulfilled almost immediately because with a market order the price doesn’t have to meet a specific price as with the limit orders. I should note that when you buy using the market feature you will receive the cheapest cryptocurrency available on the order book, and when you sell you’ll sell at the most expensive price on the order book.
Altcoin: Altcoins is basically an “alt”ernative coin to the standard Bitcoin. This refers to all the coins that are not Bitcoin since Bitcoin is really the standard cryptocurrency and all of the others that have been created are considered to be alternative options to Bitcoin.
ICO: Stands for “Initial Coin Offering.” It is basically what the stock market would consider their IPO (initial public offering), but since we are in the cryptocurrency coin world now it means the initial coin offering instead. A start up will issue their own token in exchange for other tokens.
ROI: Return on Investment. The ROI is calculated as a percentage based on the amount that your investment has gone up. If you invest $100, and now your investment is worth $200, you have a 100% ROI, meaning that your account has essentially doubled in value. We usually compare your ROI to whatever your “initial” investment is.
HODL: A dunk guy typed on social media one night stating everyone should “HOLD” their cryptocurrency but misspelled it as “HODL” and the term stuck.
Hardware Wallet: This is a small device that can securely store your cryptocurrency. Rather than storing your cryptocurrency on any given website, hardware that you use to store your cryptocurrency on is actually used as one of the most secure ways to hold your cryptocurrencies. It looks a lot like a flash drive or thumb drive in most instances.