top of page
Library

Resources Hub

FAQs

  • What is cryptocurrency?
    Cryptocurrency is a digital or virtual currency that uses cryptography for security and operates independently of a central bank. Examples include Bitcoin, Ethereum, and Litecoin.
  • How does blockchain technology work?
    Blockchain technology is a decentralised digital ledger that records transactions across multiple computers so that the record cannot be altered retroactively. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data.
  • What is the difference between Bitcoin and Ethereum?
    Bitcoin is a digital currency primarily used as a store of value and medium of exchange. Ethereum, on the other hand, is a decentralised platform that enables smart contracts and decentralised applications (dApps) to be built and run without any downtime, fraud, control, or interference from a third party.
  • What are altcoins?
    Altcoins are cryptocurrencies other than Bitcoin. Examples include Ethereum, Ripple, Litecoin, and many others. They often serve different purposes or improve on perceived limitations of Bitcoin.
  • What is a wallet in cryptocurrency?
    cryptocurrency wallet is a digital tool that allows users to store, send, and receive cryptocurrencies. Wallets can be hardware-based or software-based and provide a secure way to manage digital assets.
  • How is the value of cryptocurrency determined?
    The value of a cryptocurrency is determined by supply and demand dynamics in the market, investor sentiment, utility, and various other factors such as media coverage and market liquidity.
  • What is a blockchain explorer?
    A blockchain explorer is a web application that allows users to search and view information on a blockchain network, including transaction histories, block contents, and address balances.
  • What is a public ledger?
    A public ledger is a transparent record of all transactions that have occurred on a blockchain network, accessible to anyone.
  • What is a private blockchain?
    A private blockchain is a type of blockchain that restricts access to certain nodes or users. It is often used by companies and organisations for internal purposes where privacy is a concern.
  • What is decentralisation in blockchain?
    Decentralisation refers to the distribution of control and decision-making away from a central authority, relying on a network of nodes to validate transactions and maintain the blockchain.
  • What is a cryptocurrency address?
    A cryptocurrency address is a string of alphanumeric characters that is used to receive cryptocurrencies. It is unique to each wallet.
  • What is a seed phrase?
    A seed phrase is a sequence of words generated by a cryptocurrency wallet that gives access to the wallet's private keys. It is used for recovery purposes.
  • What is a paper wallet?
    A paper wallet is a physical document that contains a cryptocurrency address and its corresponding private key, usually represented as QR codes. It is used for offline storage of cryptocurrencies.
  • What is a hardware wallet?
    A hardware wallet is a physical device that securely stores a user's private keys offline, protecting them from hacks and malware.
  • What is a software wallet?
    A software wallet is a digital wallet that stores a user's private keys on their computer or mobile device. It is convenient for transactions but less secure than a hardware wallet.
  • What is a mnemonic phrase?
    A mnemonic phrase is a human-readable representation of a private key, often consisting of 12 or 24 words. It is used to backup and restore a cryptocurrency wallet.
  • What is a hash rate?
    Hash rate is the speed at which a computer or mining hardware can complete a hash operation, used to measure the processing power of the Bitcoin network.
  • What is a nonce in blockchain?
    A nonce is a random or semi-random number that miners use to vary the input of a hash function. It is used to find a hash that meets the network's difficulty target.
  • What is a genesis block?
    The genesis block is the first block in a blockchain, often referred to as Block 0 or Block 1. It is the foundation of the blockchain and is hardcoded into the software.
  • What is a distributed ledger?
    A distributed ledger is a database that is consensually shared and synchronized across multiple sites, institutions, or geographies, allowing transactions to have public "witnesses."
  • What is cryptography?
    Cryptography is the practice of securing information by transforming it into an unreadable format, used in cryptocurrencies to secure transactions and control the creation of new units.
  • What is a Merkle tree?
    A Merkle tree is a data structure used in blockchain technology to efficiently and securely verify the integrity of data.
  • What is an ERC-20 token?
    ERC-20 is a technical standard used for smart contracts on the Ethereum blockchain for implementing tokens. It provides a list of rules that Ethereum tokens must follow.
  • What is an ICO (Initial Coin Offering)?
    An ICO is a fundraising method in which new projects sell their underlying crypto tokens in exchange for Bitcoin or other cryptocurrencies.
  • What is tokenisation?
    Tokenisation is the process of converting rights to an asset into a digital token on a blockchain. It allows for easier transfer and division of ownership.
  • What is a whitepaper?
    A whitepaper is an authoritative report or guide that explains the theory behind a new technology or project, often used in the context of cryptocurrencies to describe the details of a new coin or token.
  • What is a governance token?
    A governance token is a token that gives holders the right to vote on decisions that influence the core protocol of a blockchain project.
  • What is interoperability in blockchain?
    Interoperability is the ability of different blockchain systems to communicate and operate with each other, enabling transactions and data to be shared across different networks.
  • What is a Decentralised Autonomous Organisation (DAO)?
    A DAO is an organisation represented by rules encoded as a computer program that is transparent, controlled by organisation members, and not influenced by a central government.
  • What is gas in Ethereum?
    Gas is a unit that measures the amount of computational effort required to execute operations on the Ethereum network. It is used to pay for transactions and smart contract executions.
  • What is a Decentralised Application (dApp)?
    A dApp is an application that runs on a decentralised network, typically utilising blockchain technology.
  • What is a token?
    A token is a digital asset that represents a unit of value on a blockchain. Tokens can be used for various purposes, including as currency, utility, or security.
  • What is a smart contract?
    A smart contract is a self-executing contract with the terms of the agreement directly written into code. It runs on a blockchain and automatically enforces the terms of the contract when predetermined conditions are met.
  • What is staking in cryptocurrency?
    Staking is the process of participating in the validation of transactions on a PoS blockchain by locking up a certain amount of cryptocurrency as collateral.
  • What is Proof of Work (PoW)?
    Proof of Work (PoW) is a consensus algorithm that requires participants to perform work (solve mathematical problems) to add a block to the blockchain.
  • What is Proof of Stake (PoS)?
    Proof of Stake (PoS) is a consensus algorithm where participants validate block transactions based on the number of coins they hold and are willing to "stake" as collateral.
  • What is liquidity in cryptocurrency trading?
    Liquidity refers to how easily a cryptocurrency can be bought or sold in the market without affecting its price. High liquidity indicates a stable market with low price volatility.
  • What is a trading pair?
    A trading pair is a market between two types of cryptocurrency. For example, the trading pair BTC/ETH refers to the market where Bitcoin can be traded for Ethereum
  • What is a limit order in cryptocurrency trading?
    A limit order is an order to buy or sell a cryptocurrency at a specific price or better. It is not guaranteed to execute, but it allows traders to control the price at which they buy or sell.
  • What is a market order?
    A market order is an order to buy or sell a cryptocurrency immediately at the current market price. It guarantees execution but not the price.
  • What is market capitalisation in cryptocurrency?
    Market capitalisation is the total value of a cryptocurrency, calculated by multiplying its current price by its total supply.
  • What is yield farming?
    Yield farming is a DeFi strategy where users provide liquidity to a protocol in exchange for rewards, often in the form of additional tokens.
  • What is a liquidity pool?
    A liquidity pool is a collection of funds locked in a smart contract that provides liquidity for decentralised exchanges and other DeFi protocols.
  • What is sharding in blockchain?
    Sharding is a method of partitioning a blockchain network into smaller, more manageable pieces called shards, each capable of processing transactions independently to improve scalability.
  • What is a sidechain?
    A sidechain is a separate blockchain that is attached to its parent blockchain, allowing tokens and other digital assets to be moved between them.
  • What is a wrapped token?
    A wrapped token is a cryptocurrency token that represents another asset, usually on a different blockchain, allowing that asset to be used within a different ecosystem.
  • What is a hard fork in blockchain?
    A hard fork is a radical change to the protocol of a blockchain network that makes previously invalid blocks/transactions valid (or vice-versa), requiring all nodes or users to upgrade to the latest version of the protocol software.
  • What is a soft fork in blockchain?
    A soft fork is a change to the software protocol where only previously valid blocks/transactions are made invalid. Most soft forks require miners to upgrade their software.
  • What is an atomic swap?
    An atomic swap is a smart contract technology that enables the exchange of one cryptocurrency for another without the need for a trusted third party.
  • What is tokenomics?
    Tokenomics refers to the economic model of a cryptocurrency, including its distribution, supply schedule, and incentives for holders and users.
  • What is cryptojacking?
    Cryptojacking is the unauthorized use of someone else's computer to mine cryptocurrency. This can be done by installing malware on the victim's computer or through a web browser.
  • What is a cold wallet?
    A cold wallet is a type of cryptocurrency wallet that is not connected to the internet, providing enhanced security against hacking. It includes hardware wallets and paper wallets.
  • What is a hot wallet?
    A hot wallet is a cryptocurrency wallet that is connected to the internet, making it more convenient for transactions but less secure compared to cold wallets.
  • What is FOMO (Fear Of Missing Out)?
    FOMO is the feeling of apprehension for missing out on a potentially profitable investment opportunity, often leading to impulsive decision-making.
  • What is FUD (Fear, Uncertainty, and Doubt)?
    FUD is a strategy to influence perception by spreading negative and dubious or false information, often to manipulate market sentiment.
  • What is a 51% attack?
    A 51% attack occurs when a group of miners controls more than 50% of a blockchain network's mining hash rate, potentially allowing them to double-spend coins and prevent new transactions from being confirmed.
  • What is a hash function?
    A hash function is a cryptographic algorithm that converts an input of letters and numbers into an encrypted output of a fixed length. It is used to secure transaction data on a blockchain.
  • What is a mempool?
    A mempool is a pool of unconfirmed transactions that each node in a blockchain network maintains. Transactions wait in the mempool until they are confirmed by the network.
  • What is a DEX (Decentralised Exchange)?
    A DEX is a type of cryptocurrency exchange that operates without a central authority, allowing users to trade directly with one another.
  • What is a pump and dump scheme?
    A pump and dump scheme attempts to boost the price of a cryptocurrency through false or misleading statements, in order to sell the cheaply purchased asset at a higher price.
  • X
  • Instagram

Copyright © 2024 Blockmaester. All rights reserved.

bottom of page