These are some vocabulary terms you might hear:
- Asymmetric Encryption: When the private key you use to verify that you want to make a transaction and your public key, or the username everyone else sees you as are different keys, making transactions much more secure. Bitcoin and other cryptocurrencies use this type of encryption to reduce fraudulent, or false transactions.
- Blockchain: A giant string or chain of "blocks" of coding, used for cryptocurrency and other purposes. The coding in the blocks cannot be undone, making it very hard to undo transactions made in cryptocurrency.
- Cryptocurrency: Cryptocurrency is a digital currency used by many people, but is not governed by any central power. The "Crypto-" half of this word refers to the encrypting that is used to help secure the transactions in the "blocks" of information that are almost impossible to undo. This makes online transactions very safe to use.
- Fork: A fork is when a blockchain suddenly fails or splits. This could be for any reason, like an error or a bug. A fork basically makes a copy of all transactions in a blockchain so there is 2 of everything. However, forks only happen in the leading cryptocurrencies about once every few hundred blocks along the blockchain. The cause of this is usually two miners making a block at the very same time.
- Key: A unique string of numbers and letters that are different for everyone. You have a private key and a public key. The private key lets you verify transactions, and your public key is what everyone else on the cryptocurrency website sees you as. For example, if your public key is sMB94wF2n31yWc0GkOxj28, if someone is trying to make a transaction with you, they will see that they are making a transaction with sMB94wF2n31yWc0GkOxj28.
- Mining: Mining is the process of adding transaction records to a cryptocurrency website. Miners are the people that verify all of the transactions. When the miners see that two people agree on an exchange, they verify it by creating a block in the blockchain that seals the transaction. Mining takes special expensive mining computers, and uses a lot of electricity, but when you mine for a cryptocurrency website, you are usually rewarded with some of that cryptocurrency for yourself.
- Second Layer: Another blockchain program that runs on top of the original blockchain code, not slowing down the original program, but helping it or adding functions.
- Symmetric Encryption: When the your private key, or the key that you use to verify transactions and your public key, or your public username key are the exact same. This is not used by cryptocurrencies due to the fraudulent or false transactions that could occur as a result.