Virtual Currency Glossary

Ancestor Mining -- Selecting transactions for virtual currency mining not just based on their fees but also based on the fees of their ancestors (parents) and descendants (children).

ASIC -- Application specific integrated circuit, which is a specialised silicon chip that performs just one task. In the digital currency space, these chips process SHA-256 in order to mine bitcoins and validate transactions

ASIC Miner -- The hardware that houses the chip of the same name. You put them into your Internet connection via a modem or wireless mode bitcoin’s independent of your desktop comput

Bitcoin -- Denominations of Bitcoin value, usually measured in fractions of a bitcoin but sometimes measured in multiples of a satoshi. One bitcoin equals 100,000,000 satoshis.

Bitcoin ATM – A bitcoin ATM is a machine similar to a cash ATM machine from which a consumer can buy bitcoin with cash.

Bitmain -- Founded in 2013, Bitmain Technologies, described as the world’s most valuable bitcoin company, was established to develop and sell the world’s leading bitcoin miners using Bitmain's ASIC chip technology. Their first miner created on ASIC technology was the Antminer S1 but  as bitcoin’s “difficulty level” kept rising there was a constant demand for more powerful units. Bitmain followed Moore’s Law to outperform all the competition and become leaders in ASIC miner technology. In May 2016, the most power-efficient bitcoin miner ever made, the  Antminer S9 was released by Bitmain It was also the world’s first consumer-grade bitcoin miner based on a 16nm process ASIC chip. The company is headquartered in Beijing, with offices in Amsterdam, Hong Kong, Tel Aviv, Qingdao, Chengdu and Shenzhen.

Block Reward -- The amount that miners may claim as a reward for creating a block. Equal to the sum of the block subsidy (newly available satoshis) plus the transactions fees paid by transactions included in the block.

Canaan -- Established in 2013, Canaan (Canaan Creative) is the worldwide leader in producing Blockchain servers and designing ASIC microprocessor solutions . Canaan products are sold globally. From the very first SHA-256 based upon FPGA technology to the Avalon Blockchain ASIC, Canaan continues to innovate by producing custom designed ASIC microprocessors.

Founded in 2013, Canaan (Canaan Creative) is the worldwide leader in producing Blockchain servers and designing ASIC microprocessor solutions . Canaan products are sold globally. From the very first SHA-256 based upon FPGA technology to the Avalon Blockchain ASIC, Canaan continues to innovate by producing custom designed ASIC microprocessors.

Cold Storage -- The storage of Bitcoin private keys in any fashion that is disconnected from the internet. Typical cold storage includes USB drives, offline computers, or paper wallets.

Cryptocurrency – Currency created mathematically . The term is frequently used in contrast to fiat currency the value of which has been arbitrarily assigned by a government.

Digital Currency – Currency created anonymously by computer – also known as “virtual currency.”

Encryption --  encoding a message using cryptography, such that only the intended recipient(s) can decode it. Bitcoin uses encryption to protect wallets from unauthorized access. 

Exchange – A place to convert different types of money and other assets.  Bitcoin exchanges, for instance, are typically used to trade cryptocurrency for fiat currency

Fiat Currency – Is a currency like the dollar or euro, for instance, which is assigned arbitrary value by government decree, as opposed to a currency like gold which has intrinsic value. The term is used now in contrast to bitcoin which obtains its value progressively through peer-to-peer networks.

Fork -- When two or more blocks have the same block height, forking the block chain. Typically occurs when two or more miners find blocks at nearly the same time. Can also happen as part of an attack.

Hard Fork -- A permanent divergence in the block chain, commonly occurs when non-upgraded nodes can’t validate blocks created by upgraded nodes that follow newer consensus rules.

Hash --  A unique identifier of a Bitcoin transaction.  It is also the mathematical function that Bitcoin miners perform on blocks to make the network secure.

Mining – The act of generating new bitcoins by solving cryptographic problems using computing hardware.

Miners -- Mining is the act of creating valid Bitcoin blocks, which requires demonstrating proof of work, and miners are devices that mine or people who own those devices.

Miners Fee -- The amount remaining when the value of all outputs in a transaction are subtracted from all inputs in a transaction; the fee is paid to the miner who includes that transaction in a block.

Multisig -- A pubkey script that provides n number of pubkeys and requires the corresponding signature script provide m minimum number signatures corresponding to the provided pubkeys.

Paper Wallet -- A type of cold storage wallet where private keys are printed on a piece of paper or other physical medium.

Peer-to-Peer – Computer parlance for the distribution of the workloads between peers. The term is frequently used to contrast with banks or central clearing houses through which fiat currency transactions and stock and bond transactions must be verified.

Satoshi -- The smallest unit of Bitcoin.  There are 100 million satoshis (8 decimal places) in one bitcoin. One satoshi = 0.0000001 bitcoins.

Satoshi Nakomoto -- The names (probably alias) of the person who wrote the Bitcoin protocol. No one has heard from him since late 2010 but many have tried to find out his identity ever since.

Tor -- The Onion Router. It's a web browser that allows anonymous browsing as it hides your IP address.

Virgin Bitcoin -- brand new bitcoins that haven't yet been spent anywhere, they were just created as a reward for a miner's work.

Virtual Currency – Currency created anonymously by computer – also known as “digital currency.”

Wallet – A method of storing bitcoins .  Often compared to a physical wallet which holds printed currency.  A wallet holds the coded keys associated with bitcoin addresses. The blockchain is the ledger of the bitcoin transactions which match up with those addresses.

Web Wallet -- A wallet controlled and held on a website hosted by another
company. It is only as secure and trustworthy as the company hosting it.
Generally suitable for spending money only, but some services pride
themselves on extra security and have multisig technology with off-line key
generation that is suitable for short- to medium-term storage.


X11 -- The algorithm used by Dash and several other currencies. It utilizes 11
different algorithms, hence the name.

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