Air Drop: Air drop is when a token or cryptocurrency is given out for free. The terminology stems from the Idea that the coin is 'dropped' into a wallet. Air drops qualifications often have stipulations such as using a specific wallet, being on a specific exchange, or holding a specific coin. Air drops are usually given out at the coins creation instead of an ICO.
Artificial Intelligence (AI): Artificial intelligence is a computer algorithm that allows a program to make decisions without updated human input. AI is found in many of the programs we use today. For example, Youtube uses AI to find videos that may have offensive or illegal content.
Blockchain: A blockchain is a packet of information (block) linked cryptographically to all previous packets of information. A proper blockchain acts as an immutable ledger, meaning the information packets and links can not be tampered.
DAO: DAO is a decentralized autonomous organization. A DAO is an organization in which all decisions are made by the voting of every member of the organization without a centralized governing body. DAO’s have yet to be successful in practice but they are a promising use of blockchain technology.
DAPPS: DApps are decentralized applications. If a cryptocurrency is using another blockchain, as in a token on the Ethereum blockchain, it is a DApp. Think of it like an app on your iPhone, but because the app is on a blockchain instead of apple software, the app is decentralized and spread amongst computers.
Decentralized: In the context of cryptocurrency, decentralized means the network is not stored in any central location. Unlike internet data, which is stored in a few centralized hubs—making it an easy target for malfeasance, blockchain data is stored in a decentralized fashion amongst all blockchain users. This makes it incredibly difficult to manipulate or hack the blockchain’s information.
Directed Acyclic Graph (DAG): In the words of Sergio Demian Lerner, the creator behind the DAG, “[DAG is] a cryptocurrency design that attempts to be highly decentralized by merging the concepts of transactions and blocks and making each user that transacts a miner. Each transaction carries a proof-of-work algorithm and references one or more previous transactions. The resulting authenticated data structure is a Direct Acyclic Graph (DAG) of transactions where each transaction ‘confirms’ one or more previous transactions.” Directed Acyclic Graph is billed as the successor to blockchain. However, the DAG technology is new and has yet to show its superiority to blockchain technology.
Distributed Ledger Technology: Distributed ledger technology is a synonym for blockchain. A ledger is a record of information. The blockchain distributes that record of information across users, leaving no one point of attack so that the ledger can not be tampered with maliciously.
Fiat: Traditional paper money printed by a centralized government. Example: USD.
Forging: Forging is a process a minority of cryptocurrencies use to generate blocks. Generating blocks is the process by which new crypto coins are generated, and transactions between individuals verified. Forging is a cross between mining and staking. Like staking, the forging process takes place though the individuals’ wallets. However, akin to mining, the rewards are not guarantee as they are with staking.
Fork: A fork is when one blockchain is split into two blockchains due to a change in the code at a specific mined block. The two coins will share a blockchain history up until the point of the fork. From the fork on, they are seen as separate cryptocurrencies. The most famous forks are Ethereum Classic and Ethereum, Bitcoin Cash and Bitcoin.
HODL: A common Bitcoin joke about holding onto your Bitcoin through periods of falling price. It originated from a Bitcoin Talk Thread in late 2013. A drunk individual posted a thread entitled I AM HODLING. This is where HODL comes from. The media likes to say HODL means Hold On for Dear Life, this description of hold is fake news.
IOT: IOT stands for Internet of Things. It is predicted in the near future our tangible devices will all be connected to the internet, this creates the Internet of Things. We already see this with household ‘smart’ items like smart refrigerators and new eco-thermostats. However, with RFID and other tracking devices the Internet of Things is expected to grow rapidly rather soon. Blockchain technology is thought to be an integral part in the future of IOT due to its security and record-keeping ability.
Masternode: Masternodes can run POS (proof of stake) blockchains. Masternodes are large holders of a certain cryptocurrency and are used to verify the blockchain for transactions. This is similar to what miners do for POW (proof-of-work) blockchains. Masternodes have privileges that regular nodes do not. Masternodes require a computer to be running at all times. Those running master nodes are rewarded with the token they are verifying. Masternodes are not required for POS blockchains, however, many POS blockchains are moving to a tiered governance system with masternodes having a stronger say in the blockchains ecosystem.
Mining: Cryptocurrency mining is the most common way transactions are verified on a blockchain. Mining is an energy intense process by with computers solve complex algorithms hidden in blocks to verify the blockchain is untampered. For example, whenever a new Bitcoin is created or a Bitcoin transaction takes place, miners verify that process. It is the backbone of cryptocurrency decentralization. Instead of financial transactions being verified by banks, they are verified by independent miners all over the world. Miners receive a small payment for each transaction verified. It is why cryptocurrency transactions have small fees.
Node: A Node is a blockchain validator. Think of it as a intersection on the web of decentralization. For a POW (proof-of-work) blockchain, miners run nodes. For a POS (proof of stake) blockchain, the staking wallets themselves are the nodes.
Sidechain: DApps traditionally run on the blockchain for which they are built. For example, an Ethereum DApp will run on the Ethereum blockchain. However, some platforms set up Sidechains for DApps. These Dapps have their own blockchain that is connected to the mainchain. These are still not very popular, however, many have the benefit of scaling, as all DApps running on the main platform chain can cause network congestion.
Staking: Staking is the way POS (proof of stake) blockchains verify transactions. Users set up staking wallets by which the wallets verify the blockchain for a reward of the cryptocurrency they are staking. Usually, the reward is set in a monthly percentage based on the amount of coins the wallet stakes. Often these staked coins can not be used for a certain period of time. Staking systems sometimes use master nodes but it is not necessary. Staking is still not as popular as mining because it is less energy intensive. However, it is gaining steam.
UTXO: A UTXO is an Unspent Transaction Output. Unspent transactions are those that have yet to be verified by a node. Usually high UTXO means more network congestion, and thus, higher fees for faster transactions.