Congratulations, you’re taking the first step to becoming a crypto master! Before you jump down the rabbit hole, it’s good to just get familiar with some of the concepts and terminology that we will teach in the next lessons. You have probably heard a lot of different terms such as Blockchain, stablecoins, and more. In this lesson, we’ll give you a quick introduction to basic crypto concepts before diving into them deeper in our later lessons.
Understanding The Crypto Landscape
Cryptocurrencies are a digital form of money that runs on blockchain technology. Mining cryptocurrencies is a process that requires computer processing power to solve complex mathematical problems to create coins.
A blockchain is a system in which a record or ledger of transactions made is maintained across several computers that are linked in a peer-to-peer network.
Bitcoin is a cryptocurrency created by the pseudonymous developer(s) Satoshi Nakamoto. It is also the first cryptocurrency to be introduced.
Ethereum is a decentralized blockchain that is open-source and allows users to build applications on it.
- Smart Contracts
A smart contract is a computer program, also known as a transaction protocol, that works to automatically execute, control, or document relevant events and actions. This will occur according to the terms of a contract or agreement.
A wallet allows you to interact with blockchain networks, access your funds, and perform transactions.
Stablecoins are a type of cryptocurrency that derives its value from being pegged to another currency or financial instrument. The most common type of stablecoins are those pegged to the US Dollar. Therefore the price of a stablecoin will reflect the price of the US Dollar.
An NFT (non-fungible token) is a digital asset that represents objects like art, music, in-game items, and videos. Unlike cryptocurrencies, NFTs are unique and one of a kind, or at least one from a collection. There is usually a unique identifying code programmed into it.
The crypto space might seem a bit scary at first because there are so many different concepts, terms, and products out there. Our advice is to take it all one step at a time!
You should be able to answer all the questions below. If you are having trouble answering any of them, go back and review the lesson & the external content.
- What is blockchain?
- What are cryptocurrencies?
- What are NFTs?
- What is decentralization?
- Who created Bitcoin?