When you are new to cryptocurrencies, you may feel a little confused and overwhelmed. Don’t worry, we have prepared a detailed beginner’s guide to cryptocurrency to help you quickly understand the basics of digital currencies and related trading operations. Whether you are just starting to understand digital assets or want to deepen your understanding of cryptocurrencies, here is is a good place to start.

Commonly used terms in the currency circle

To conduct cryptocurrency trading, you definitely need to briefly understand the vocabulary often mentioned in the currency circle, otherwise you will be confused.

Read "Analysis of Common Terms in the Currency Circle". This site has prepared explanations for some frequently seen terms.

1. Cryptocurrency Exchange

In the currency circle, cryptocurrency exchanges generally refer to centralized exchanges, and exchanges do not promote them.

2. Bitcoin

The concept of Bitcoin was first proposed by Satoshi Nakamoto in November 2008. It is a peer-to-peer electronic cash system that does not require the participation of central institutions such as governments, but is maintained by everyone. The total number of Bitcoins is constant at 21 million. Therefore, Bitcoin has the reputation of "digital gold".

3. Cryptocurrency

Similar to Bitcoin.

4. Stablecoins

Stablecoin is a cryptocurrency with stable value. Due to the huge price fluctuations in the cryptocurrency market, investors need a medium of exchange to connect the digital currency world with the fiat currency world (fiat currency is legal currency, such as RMB and USD), and stablecoin was born.

The most widely recognized stablecoin is usdt, which is a stable value dollar (usd)-based token launched by Tether. 1 usdt = 1 US dollar. The biggest feature of usdt is that it is equivalent to the same amount of US dollars. usdt is designed to be a replica on the legal currency digital network, making it a good value-preserving token in the volatile cryptocurrency market.

5. Fiat Currency

Legal currency is legal currency, issued by the country and the government, and is only guaranteed by government credit, such as RMB, US dollars, etc.

6. Tokens

A token is an encrypted virtual currency. It consists of a symbol and plays the role of representation. In the currency circle, BTC (Bitcoin) and ETH (Ethereum) are recognized and leading tokens.

7、KYC

KYC refers to identity authentication. KYC is the abbreviation of Know Your Customer, which means know your customer. In the international Anti-Money Laundering Law regulations, organizations are required to have a comprehensive understanding of their customers in order to predict and discover business behaviors. unreasonableness and potential illegal conduct.

8. C2C transactions

Transactions between users using fiat currency and cryptocurrency through exchanges are called C2C transactions.

9. Spot trading

Spot trading is also called currency trading. Buying other cryptocurrencies, including Bitcoin, via stablecoins (pegged to the U.S. dollar and having a constant value) or selling cryptocurrencies for stablecoins is known as crypto-to-crypto trading.

10. Contract trading

Contract trading refers to two contract products: perpetual contracts and delivery contracts. Most people use perpetual contract transactions, and perpetual contracts are divided into U-standard contracts and ratio-standard contracts. Among them, most people trade the U-standard contract the most.

In addition, it is not recommended for novices to touch contracts.

11. K-line chart

K-line chart (Candlestick Charts) is also called candle chart, Japanese line, Yin and Yang line, bar line, red and black line, etc. The commonly used term is "K line". It is plotted as the opening, high, low and closing prices for each analysis period.

12. Coin speculation

Currency trading and stock trading have similar meanings. They refer to the act of repeatedly buying and selling crypto assets through a trading platform in order to obtain high profits.

13. Deposit and Withdrawal

Purchasing cryptocurrencies through C2C transactions is called deposit in the cryptocurrency circle, and the opposite is called withdrawal.

14. Transaction-related terms

Position: refers to the ratio of the investor’s actual investment to the actual investment funds.

Open a position: buy virtual currency.

Cover position: Buy virtual coins in batches, for example: buy 1 BTC first, and then buy 1 BTC later.

Full position: Use all funds to buy virtual currency at one time.

Reduce positions: sell some virtual currencies, but not all.

Heavy position: Compared with funds and virtual currency, virtual currency accounts for a large share.

Light warehouse: Compared with the virtual currency, the capital share is larger.

Short position: Sell all the virtual coins you hold and convert them all into funds.

Locking a position: generally refers to the opening of a new position opposite to the original position by investors after buying and selling a contract when the market shows a trend opposite to their own operations. It is also called locking, locking orders, or even euphemistically called double butterfly flying.

Take profit: After obtaining a certain amount of profit, sell the virtual currency held to keep the profit.

Stop loss: After the loss reaches a certain level, sell the virtual currency held to prevent the loss from further expansion.

Bull market: Prices continue to rise and the outlook is optimistic.

Bear market: Prices continue to fall and the outlook is bleak.

Long (long): The buyer believes that the currency price will rise in the future, buys the currency, and after the currency price rises, sells it at a high price to take profits.

Short (short-selling): The seller believes that the currency price will fall in the future, sells part of the currency he holds (or borrows currency from the trading platform), locks the position and takes profits after the currency price drops to a certain price. At the same time, he can avoid risk

Rebound: When the currency price falls, the price rebounds and adjusts due to the rapid decline.

Consolidation (sideways): The price fluctuation is small and the currency price is stable.

Falling: The currency price is slowly declining.

Diving (Waterfall): The currency price drops rapidly and by a large margin.

Cutting meat: After buying virtual currency, the price of the currency falls, and in order to avoid expanding the loss, sell the virtual currency at a loss. Or after borrowing currency to go short, the currency price rises, and you lose money by buying virtual currency.

Hold-up: The currency price is expected to rise, but the currency price falls after buying unexpectedly; or the currency price is expected to fall, but the currency price rises after selling unexpectedly.

Unwinding: After buying a virtual currency, the price of the currency fell, causing temporary book losses, but then the price of the currency rebounded and the loss turned into a profit.

Shortage: After selling the virtual currency due to being bearish on the market outlook, the price of the currency continued to rise, and I was unable to buy it in time, so I failed to make a profit.

Overbought: The coin price continues to rise to a certain height, the buyer's power is basically exhausted, and the coin price is about to fall.

Oversold: The currency price continues to fall to a certain low, the seller's power is basically exhausted, and the currency price is about to rise.

Lure buyers: The currency price has been consolidating for a long time and is more likely to fall. Most of the short sellers have sold the virtual currency. Suddenly the short sellers pull up the currency price, inducing the bulls to think that the currency price will rise and buy one after another. As a result, the short sellers are suppressed. The currency price has locked up many parties.

Short-selling: After bulls buy virtual currency, they deliberately suppress the currency price, making short sellers think that the currency price will fall, and sell them one after another. As a result, they fall into the trap of bulls.

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