The world of crypto can be a confusing place, especially with the vast amounts of terminology and acronyms out there.
What is Crypto?
Cryptocurrencies or crypto for short, is a digital payment system that allows users to send and receive payments. Once you have transferred cryptocurrency funds, the transactions are recorded in a public ledger and stored in a digital wallet. Cryptocurrencies don’t have a central issuing or regulating authority, therefore it uses a decentrallised system to record transactions and issue new units.
In 2009 we saw the launch of the first ever cryptocurrency, bitcoin. Since then the industry has boomed, now in 2023 there are up to 9,000 different digital currencies in circulation. There are no signs of this digital world slowing down any time soon, it is estimated that global crypto ownership rates is at an average of 4.2%, with over 420 million crypto users worldwide.
Acronyms and Terms you need to know
If you are thinking of entering the crypto industry, here are key acronyms and terminology you should know:
Altcoin is an alternative digital currency to Bitcoin.
Automated Market Maker is an automated decentralized exchange where trades are made against a pool of tokens called “liquidity”.
Bitcoin is a form of digital currency that uses blockchain technology to support transactions between users on a decentralized network.
An append-only, decentrailised ledger that can store data in a censorship-resistant way.
Allows independent blockchains to communicate with each other to transfer assets or messages.
Digital assets whose global transaction history is stored on a blockchain.
A platform that enables the exchange of cryptoassets for other cryptoassets or fiat currencies.
A way to keep information secrete and secure putting it into indecipherable codes. The information can then only be decrypted and read with necessary keys.
Decentrailsed Autonomous Organisation(DAO)
An internet-native organization managed by members, often using open-source code and smart contracts.
Decentrailsed Exchange (DEX)
A platform for buying, trading, and selling digital assets directly on the blockchain without centraised intermediary.
Software that interacts with blockchains to facilitate the storage of cryptoassets.
Distributed ledgers use nodes, or independent computers, to record, share, synchronize transactions on the electronic ledger.
The native asset of the Ethereum blockchain and is used to pay for transaction and smart contract fees on the network.
The combined number of computations (hashes) performed by all miners within a network per second.
The process where market makers provide assets to a specific pool to earn fees or rewards.
Initial Coin Offering is the cryptocurrency equivalent of an initial public offering.
Know Your Customer, whilst not required many crypto exchanges carry out certain identity checked on their customer under the KYC rules.
A record of transactions maintained by both centrailised financial institutions and decentrailised finance applications.
A mechanism where individuals within a network solve computationally difficult proofs of work to confirm transactions and add new blocks to blockchain.
A computer or device connected to other computers or devices that all hold a copy of blockchain. Each node supports the broader network by sharing information and validating transactions.
Non-Fungible Token (NFT)
A unique cryptographic token that is not interchangeable with any related asset and cannot be divided or altered.
Refers to information and transactions executed and stored explicitly.
Is also known as the secrete key that encrypts passwords to someone’s crypto holdings.
The public-facing address of your crypto wallet. To receive funds into your account you need a public key.
Is a mechanism that selects block creators based on a participant’s stake, such as the number of tokens they hold or how long they have participated in the network.
A piece of data to add new transactions on a blockchain. PoW is difficult to produce but easy for others to verify. It is used in the consensus mechanisms of some cryptoasset networks.
A market in which players must follow certain rules of risk fines or the loss of the operating licenses.
A digital code typically programmed onto a blockchain that enforces a previously agreed-upon transaction based on preset conditions.
Cryptoassets that intend to maintain price parity with a target asset, most commonly fiat currencies like the US dollar.
The process of locking up tokens to be eligible to verify transactions on the blockchain and earn rewards.
An individual cryptocurrency, it is a way to refer to a cyrpto that runs on a particular blockchain.
Total Value Locked (TVL)
A dcentrailised finance (DeFi) native metric that measures the cryptoassets locked in DeFi protocols through smart contracts, akin to assets under management (AUM).
Zero-Knowledge Proofs (ZKPs)
A cryptographic method that enables an individual to prove a verifier that a particular asset or information exists without revealing details about the asset or information itself.
Why Choose ILS World
As an independent global provider of fiduciary services to professional advisors, international corporate groups, and private clients we pride ourselves on our can-do attitude, taking new legislation and previously unseen business models in our stride, which has allowed us to become a leading fiduciary service provider within the digital sector.
ILS World first entered the eGaming sector in 1998, since then our digital team has acquired strong working relationships with the Gambling Supervision Commission (GSC), the Digital team within the Department of Enterprise, and providers of ancillary services. With a GSC approved team of directors we have developed specialist knowledge and skills to keep pace with this ever-changing sector.