5 crypto buzzwords everyone should know in 2022

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In 2021, people couldn’t help but talk about cryptocurrency. 2022 will be no different.

Interest in crypto has exploded, with trading apps like Robinhood and Webull and payment platforms like Venmo and Cash App allowing anyone with a smartphone to buy and sell Bitcoin, Ethereum and more. again. The internet is full of chatter about volatile prices – especially record highs – and more companies are starting to accept crypto as a form of payment.

Money has a comprehensive guide to what cryptocurrency is and how it works. But the world of crypto is changing rapidly.

Here are 5 crypto buzzwords you’ll likely hear in 2022, and what they mean.

Altcoin

Bitcoin, the first cryptocurrency, was created in 2009. Since then, it has accumulated a market value of $ 925 billion, paving the way for the emergence of alternative cryptocurrencies, or altcoins. Today, some experts say that altcoins like Ethereum, Cardano, and Solana actually have more features than Bitcoin (like running DeFi apps – we’ll get to that later), which could make them more valuable in the future.

Stablecoins, another type of altcoin, have a value tied to an outside asset like gold or the US dollar. Then there are the meme pieces, which are useless but are skyrocketing in popularity because people think they are funny or cute.

“People love to gamble, so as long as the market is hot, I think there will always be a place for it,” Daniel Polotsky, founder and chief advisor of Bitcoin ATM company CoinFlip, said of the coins. cash.

There are over 15,000 cryptos in circulation, according to CoinMarketCap, and more are being developed every day.

Web 3.0

Explaining what Web 3.0 is is difficult, because the definition is worked on and reworked in real time. But since people keep talking about it, nothing works.

The general idea is that Web 3.0 is a version of the Internet where people have ownership of their digital property and control of their data, without having to go through intermediaries like Facebook and Google.

First there was Web 1.0, which was the original version of the Internet with static sites (remember GeoCities?). Then Web 2.0 emerged, with the arrival of Amazon, Twitter and all those other sites that helped make the Internet more user-friendly. Web 3.0 consists of taking back some of the power of these technological behemoths.

2022 will be an important year for Web 3.0, with the emergence of new products that support encrypted web interactions, said Nick Casares, product manager at Polyient, an investment group that focuses on virtual economies. Products like Compound and Aave, which allow encrypted access to financial products via DeFi or to property via NFT, are poised to become the leaders in the march towards the so-called new Internet, Casares said. (Don’t worry, we’ll cover some of these buzzwords below.)

Crypto wallet

Crypto wallets allow you to store the secure digital codes needed to interact with the blockchain – a ledger that records all account balances and transactions of a cryptocurrency across the world. In other words, you need it if you want to buy and sell crypto.

Some crypto wallets are called “hot wallets,” which are connected to the internet and can be easily accessed with your phone or computer. Cold wallets, on the other hand, are offline and live on a piece of hardware (similar to a USB stick) or even a piece of paper. Which crypto wallet will work best for you depends on a few factors, including whether you are a newbie and want to trade Bitcoin or other cryptocurrencies.

Still with us? Money has a guide to the best crypto wallets, with tons of additional information on how exactly these things work.

Challenge

Decentralized finance, or DeFi for short, refers to a variety of financial products that can be accessed directly through a blockchain network so that users do not need to go through brokerage firms or other intermediaries.

Defenders of DeFi argue that creating a direct line between a consumer and these products – instead of having them go to a big bank when they need a loan, for example – can cut costs and make transactions faster. and more secure.

There are certainly risks. DeFi mimics the highly regulated services of the traditional financial ecosystem, but does so without the same regulation, says Ben Cruikshank, director of Flourish, a fintech platform that recently launched its own cryptocurrency offering. And fraud is rampant: In November, blockchain analytics firm Elliptic found losses on DeFi platforms due to theft and crime to reach $ 10.5 billion in 2021.

TVN

You’ve probably heard of non-fungible tokens (NFTs) before. In 2021, the NFT frenzy had buyers shell out thousands of dollars for digital art of Lebron James dipping a basketball and an animated cat with a Pop-Tart for a body.

So what exactly is an NFT? It is a cryptocurrency innovation that allows someone to own digital property. In addition to art, “NFT” can be used to describe a wide range of assets such as music, games, title deeds (for real world items such as deeds) and information. identification such as diplomas and certifications, explains Casares.

The craze is sure to bleed into the New Year, especially now that celebrities like Martha Stewart and companies like Coca-Cola are getting into the party. As with most things crypto, it’s impossible to say whether the NFT mania is a fad or a lasting trend, but the appeal is certainly on the rise.

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