Test Your Crypto Knowledge – 5 New Terms

Did your new year’s resolutions include learning new skills or broadening your knowledge? We’re here to help you out with that! We put together a little test for you – go ahead and see if you know the meaning of the five interesting crypto terms we selected. 

Haven’t heard of these definitions? No problem! Check out the videos of our CEO Kevin Murcko explaining these definitions. He clarifies a new topic every week during our weekly AMA – another great learning source! 

 

Mnemonic

Mnemonic is a pattern — words, images — that helps you remember something much more complicated. This pertains to crypto with seed phrases. For example, if you are going to set up a hardware wallet, and you want to back up your private key, you’re given a list of words. You write those words down. Those words are actually a mnemonic phrase, which helps you recover your private key if you lose it. 

Mnemonic phrases are not only in use in crypto. It is a well-known learning tool across all fields – ranging from learning the order of guitar strings to history studies. Mnemonic examples include rhymes and phrases from songs or poems.

 

Atomic Swaps

Atomic swap is an exchange that happens automatically by way of a smart contract. Atomic swaps can happen cross chain or on the same chain. For example, if you want to acquire some Ethereum in exchange for another token, a smart contract is created. This contract specifies the amount of tokens that need to be transferred to a specific contract address, as well as the amount of Ether that needs to go to another contract address. Once these actions are fulfilled, both parties receive their assets. This concludes the contract.

Atomic swap protocols have a lot of potential in taking over subscription based- and automatic payments in the future. The technology is still developing but has a lot of promise once it becomes more mature.

 

Margin Call

A margin call means that you’ve used up your available equity, it has zeroed out in comparison to the amount of market exposure. A margin call happens before the stop out. If you don’t add in more margin very shortly, you will get stopped out. 

Margins came into play when markets went somewhat electronic. The term originates from the fact that the broker used to reach traders by calling in the early days.

 

Vanity Address

When you open a crypto wallet, you get an address that is a long string of letters and numbers. A vanity address assigns recognizable characters to an address. These recognizable characters could be initials, brand names or other characteristics. 

Bitcoin vanity addresses are often used in crypto. The concept is similar to vanity plates used for cars, that allow customizing the license plates.

 

Darksend

A darksend is an automatic or autonomous decentralized mixing “button” that makes it possible to send assets anonymously on the blockchain. 

Outside of Darksend, anonymity could be achieved by using a centralized mixer. Centralization brings a risk that the mixer doesn’t protect the data properly and an authority will intervene to shut down the mixer or trace and reveal the data. Darksend mixing developed by Dash was based on the idea of a decentralized mixer, therefore decreasing the chances of tracing data back to its owner. 


Hopefully you learned something new from this! If you are looking to broaden your crypto knowledge in a practical way, go ahead and start trading on our platforms! If you have any questions about our platforms or CoinMetro in general, reach out to our support team. They are there to help 24/7.

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