Glossary of Terms
This is a comprehensive list of terms to become familiar with. They can be found throughout our articles.
A wallet address consists of 27 - 34 letters and numbers. (Technically speaking, it is a 160-bit hash). An address begins with a 1 or a 3. With a wallet service you can create an address free of charge for every transaction. A user should generate a new address for each new transaction.
Application-specific integrated circuits (ASICs) are specialized computer chips customized for use in Bitcoin mining. Modern mining hardware utilizes ASICs to calculate the SHA-256 algorithm as quickly and efficiently as possible, thus putting them in the best position to successfully mine Bitcoin blocks while using the least amount of energy.
The blockchain is the backbone of the Bitcoin protocol and keeps the network honest. It is a distributed public ledger of account which keeps track of every transaction ever made in the network, and all transactions are time stamped and verified by network miners.
Dollar-Cost Averaging (DCA)
An investment strategy using a fixed amount of dollars (or other currencies) to buy an asset at regular intervals. For bitcoin investing, this means buying Bitcoin with a fixed amount of fiat currency at regular intervals, regardless of what the price is at any given interval. Daily, weekly, monthly, etc.
Double-spending is a potential risk of digital currency and occurs when a digital token is used more than once.
A fiat currency is a traditional currency like the U.S. dollar and the euro, which ultimately derives its value from its use being mandated by a government for payment of taxes and as legal tender.
Miners use specialized computers and compete to solve mathematical puzzles with other miners, and once they solve a puzzle they add a “block” of completed transactions to the blockchain for future viewing and verifiability, and are awarded with a predetermined amount of Bitcoin.
Nodes are computers that are connected to each other, all of which follow a set of rules and share information. A 'full node' is one that hosts and maintains an up-to-date copy of the complete blockchain.
A satoshi is the smallest unit a Bitcoin is divided into, much like pennies are to a dollar. A Bitcoin is comprised of 100,000,000 (one hundred million) satoshis.
Satoshi Nakamoto is the pseudonym used by the person or persons who authored the Bitcoin white paper, designed and wrote the source code for Bitcoin Core, and released the protocol version 0.1 on January 09, 2009.
A transaction that has not been included in the blockchain yet. Each node is informed about this transaction. A transaction can be left unconfirmed for a long period of time (not included in the blockchain) because of the following reasons:
If a transaction has a low priority (the longer coins are being not expended, the higher priority it has)
Due to a very big transaction amount
Due to a low set fee
UTXO stands for Unspent Transaction Output. A UTXO is the unspent output of a blockchain transaction used to input a new transaction. It is similar to a coin because it has a specific value, as each UTXO contains a certain amount of satoshis.
Please contact us with any Bitcoin questions you have. Remember: NEVER provide ANYONE from our website or any other website with your personal information when seeking technical advice.
Thank you for visiting.