Crypto Guide: Here's a Glossary of Basic Terms
Over half of Filipinos have shown interest in owning cryptocurrency but only about 4% have started buying digital tokens, a study showed, highlighting the huge potential of digital currency in the Philippines.
Some 53% of 110 million Filipinos are interested in possessing digital tokens but only around 4 million are in ownership of crypto coins, a study by blockchain and cryptocurrency data aggregator TripleA showed.
"In spite of the current bear market, crypto in the Philippines is ripe with opportunity," Lance Chua, chief financial officer of edutech platform Bitskwela, told reporters during a workshop hosted by Globe Telecom.
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It's no secret that digital is the future and for those who are interested in starting out on their cryptocurrency journey, here are basic terms that you need to know according to Bitskwela:
Cryptocurrency
A type of digital currency secured by cryptography, which refers to the practice of techniques for secure communication in the presence of adversaries or bad actors.
Blockchain
A digital ledger that stores the transactions happening in the Bitcoin network in the form of blocks. Bitskwela said blockchain can be thought of as a chain that ties all the transactions together one after the other.
NFT
NFT stands for Non-Fungible Tokens. An NFT is a unique cryptographic asset that exists on the blockchain and cannot be replicated.
Play-to-Earn Game
These are online games that let players earn rewards with real-world value. The rewards can be earned either by completing various tasks, battling other players, or progressing through levels of the game.
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Stablecoins
These are cryptocurrencies where value is tied to another currency, commodity or financial instrument. They usually serve as a "bridge" between traditional finance and crypto markets.
The most common example is Tether (USDT).
Utility tokens
These are tokens that serve some use case within a specific ecosystem. The most famous example of a utility token is Ethereum (ETH).
Governance tokens
These are tokens that help shape the future of a protocol by giving holders the power to vote on issues that concern a blockchain project. They are also known as "tradable voting ballots."
Common examples are Maker (MKR), and Compound (COMP).
Security tokens
Like stocks, security tokens represent ownership in assets. Usage and issuance of security tokens are governed by financial regulation.
Examples include Blockchain Capital Token (BCAP), and INX Limited (INX).
Memecoins
Memecoins, as the name implies, are inspired by memes, funny ideas online, and even culture.
Memecoins usually have little to no utility and prices are typically driven by trends.
Examples include the Dogecoin (DOGE) and Shiba Inu (SHIB).
So before diving into the world of cryptocurrency, always remember to invest only what you're willing to lose and to practice risk management.