Basic knowledge of the currency circle Basic knowledge that novices in the currency circle must understand

This guide will provide you with the following basic knowledge needed to get started in the currency circle: what are concepts such as cryptocurrency, blockchain, wallets and exchanges. Additionally, key terms such as stablecoins, altcoins, mining, holding (HODL), airdrops, and fiat currencies are covered. By understanding these basics, newbies can better understand the cryptocurrency community and make informed decisions.

Basic knowledge of the currency circle: essential for beginners

1. What is cryptocurrency?

Cryptocurrency is a decentralized digital asset that is protected using cryptography. They are not controlled by governments or central agencies.

2. What is blockchain?

Blockchain is a distributed ledger technology that records cryptocurrency transactions. It consists of blocks linked together, each block containing a batch of transaction records.

3. What is a wallet?

A wallet is a software or hardware device used to store, send and receive cryptocurrency.

4. What is an exchange?

Exchanges are platforms for buying and selling cryptocurrencies. They offer users the opportunity to buy and sell different cryptocurrencies.

5. What is a stablecoin?

Stablecoins are cryptocurrencies that are pegged to a fiat currency (such as the U.S. dollar) and are designed to maintain a stable value.

6. What are altcoins?

Altcoins are an umbrella term for all other cryptocurrencies except Bitcoin.

7. What is mining?

Mining is the process of validating and adding new blocks to the blockchain by solving complex mathematical problems. Miners use specialized computers or mining equipment to mine.

8. What does holding (HODL) mean?

Holding (HODL) is a term that refers to holding a cryptocurrency asset for the long term without selling it.

9. What is airdrop?

Airdrop is an activity in which projects issue cryptocurrency or tokens to users for free to promote the development of the project.

10. What does fiat mean?

Fiat currency refers to government-issued currency that is not backed by intrinsic value, such as the U.S. dollar or euro.

11. Risks of Cryptocurrency Trading

• Volatility: The cryptocurrency market is prone to fluctuations, and prices may fluctuate significantly.
• Security: Cryptocurrency wallets and exchanges are vulnerable to hackers.
• Regulation: Cryptocurrency regulations are constantly changing and may impact their value and usability.

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