A Guide to Basic Cryptocurrency Terms
This glossary covers blockchain operation, assets and wallets, decentralized applications, and common risks. Beginners can start with blockchain, wallets, and consensus before learning about DeFi, trading orders, and security concepts.
How Blockchain Works
A blockchain is a decentralized digital ledger that records transactions in chronological order. Nodes jointly maintain the network and use consensus mechanisms such as proof of work to confirm its state. Once verified, transactions are written to blocks and can be viewed with a block explorer. A mainnet carries real transactions, while a testnet is used for functional testing.
Assets, Wallets, and Applications
Cryptocurrencies use cryptography to secure transactions and can be sent and received through wallets. A public key or address identifies a receiving destination. A seed phrase controls access to a wallet and must be protected carefully. Smart contracts execute automatically according to code, enabling applications such as DApps, decentralized exchanges, and DeFi.
Introduction to Trading and Risk
Centralized platforms generally hold assets on a user's behalf, while decentralized platforms let users trade through their own wallets. A market order seeks immediate execution, whereas a limit order specifies a price. Insufficient liquidity can cause slippage. Beginners should also understand counterparty risk, malware, Sybil attacks, and market manipulation.
Original Tutorial
https://www.binance.com/zh-CN/academy/glossary
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