Meme Coins, DeFi, and Other Crypto Buzzwords You Need to Know by Now

You can get away with little crypto knowledge in 2021, but it’s a new year and the crypto market is worth $3 trillion right now , and you have no excuse for not becoming crypto literate. Here are some of this year’s most popular buzzwords you should know, and a couple of lesser new ones to make this bold new money world less…well, mysterious.

Blockchain

While not new, you need to know what it means if you want to understand cryptography. Blockchain is a decentralized encrypted ledger that records all cryptocurrency transactions around the world. More precisely, it is a shared database in which blocks of data (such as account balances and transactions) are linked to each other in chronological order. In the blockchain, digital information is permanently recorded and is not editable. (Yep.)

Altcoin

If bitcoin is the grandfather of cryptocurrency, then altcoin is all of its “alternative coins” or alternative versions. The most famous of them are: Ethereum, Solana and Dogecoin.

stablecoins

A subset of altcoins, stablecoins provide the benefits of cryptography with greater stability. (Cryptocurrency prices are notoriously volatile—Bitcoin stocks have been known to drop $9,000 in value overnight.) Stablecoins (such as Tether, USD Coin, and Binance), designed for a relatively stable price, pegg their value to real assets—commodities. like gold or other currencies such as the US dollar or euro.

meme coins

If someone told you ten years ago that new forms of currency inspired by memes and online jokes (like “doge” is a misspelling of the word “dog” that first appeared in an animated web series and then popularized on Reddit ) will be available for exchange. in the stock market, would you believe them? Yes, me too. However, we are here .

Dogecoin

(DOHJ coin): This is the most prominent example of the meme coins mentioned above. This cryptocurrency was first released in 2013 as a joke to poke fun at the wild popularity and (at the time) seeming baselessness of the cryptocurrency. It gained wide popularity after it was advertised by Elon Musk.

Web 3.0/Web3

In fact, the third iteration of the Internet. If Web 1.0 marked the launch of the original World Wide Web with static sites, no ads, and dial-up access, then Web 2.0 marked the birth of technology giants (Amazon, Google) and user-generated content (blogs, podcasts). , and social networks), then Web 3.0 suggests that the Internet will evolve into a decentralized network built on peer-to-peer connections , where people will theoretically retain more ownership of their digital property. (Key features of Web3 include 3D graphics, artificial intelligence, virtual reality, and semantic metadata.)

Cryptocurrency wallet

A place to store your personal “keys” or passwords that give you access to the blockchain. These can be “hot wallets”, i.e. virtual ones (like the Coinbase Wallet mobile app), or “cold wallets”, meaning tangible hardware like a Ledger . In any case, if you want to trade cryptocurrencies, this is a must.

DeFi

Sometimes referred to as the “Wild West of Finance,” decentralized finance is a largely unregulated industry of automated financial instruments that allows crypto users to lend, borrow, speculate through derivatives, and trade crypto directly through the blockchain, without the need for a brokerage. banks or other intermediaries.

NFTs

Non-fungible tokens allow buyers to own collectible digital art, music or games, and other assets that are far more interesting than Bank of America stock. Think of it like a trendy crypto; it’s not just for fintech geeks, but for investors who might want to spend $208,000 on LeBron James’s epic dunk – i.e. digitally.