Crypto Abreviations Flashcards by Liudmyla Amelko

AML

Anti money laundering

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TxID

The term “Transaction ID,” often abbreviated as TXID, is an alphanumeric string that serves as a unique identifier for individual transactions on a blockchain, ensuring both transparency and traceability.

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Satoshi Test

A satoshi is the smallest unit of Bitcoin currency. 1 satoshi = 0.00000001 B
You can convert 1 USD to 5,921.33 SATS approx

A Satoshi Test is a method to verify ownership of an address belonging to a virtual asset service provider (VASP) customer’s self-hosted wallet (unhosted wallet).

To verify the address’s ownership, a small amount of crypto assets (coins), predefined by the VASP, is sent from the wallet owner’s address to the VASP within a specific time period.
If the wallet owner can successfully send the coins, it serves as proof of address ownership.

The proof is considered invalid if a wallet owner does not complete the transaction in the given timeframe. It has to be redone with a new predefined amount and within a new specific time period. With successful transfers, the wallet user will be reimbursed for the transferred coins. However, the mining fees will not be returned.

The amount transferred is usually around the value of USD 1. This represents a fraction of a Bitcoin, whose smallest unit is a satoshi. Hence the name Satoshi Test. However, this method can be used for most crypto assets.

Depending on the VASPs jurisdiction and AML policy, a Satoshi Test only provides a proof for a limited time (e.g. 1 week) and afterwards has to be repeated, even if the wallet user’s address stays the same.

In some regions, a Satoshi Test is called a Penny Test or a Micro Transfer.

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VASP

Virtual Asset Service Provider (VASP)

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FATF

The Financial Action Task Force (FATF) is the global money laundering and terrorist financing watchdog. It sets international standards that aim to prevent these illegal activities and the harm they cause to society.

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CASP

Crypto-asset Service Provider (CASP) - European term (it is part of VASP)

CASP activities include:
-the custody and administration of crypto assets on behalf of third parties,
-the operation of a trading platform for crypto assets,
-the exchange of crypto assets for fiat currency that is legal tender,
-the exchange of crypto assets for other crypto assets,
-the execution of orders for crypto assets on behalf of third parties,
-the placing of crypto assets,
-the reception and transmission of orders for crypto assets on behalf of third parties,
-providing advice on crypto assets.

Cryptoasset Business (CB) UK term (it is part of VASP):
In the UK, a Cryptoasset Business (CB) is either a cryptoasset exchange provider (CEP) or a custodial wallet provider (CWP)

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TRAVEL RULE

Data sharing. To quickly recap, the Travel Rule requires VASPs to share the personal information of a transaction’s sender and recipient with other financial businesses or VASPs.

Also known as: FATF’s Recommendation 16

https://sumsub.com/files/Sumsub_Travel%20Rule_White%20Paper.pdf

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IBKR

Interactive Brokers platform (need to clarify deeper)

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API

An application programming interface (API) establishes an online connection between a data provider and an end-user. For financial markets, APIs interface trading algorithms or models and an exchange’s and/or broker’s platform. An API is essential to implementing an automated trading strategy.

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CRM

Customer Relationship Management

Communication with clients and the development of internal and external communications are handled by CRM (Customer Relationship Management) systems in brokerage organizations. Brokers often take a unique approach to customer relationship management at this level.

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Indices

Made up of a basket of shares, a stock market index can be traded like an individual share. By buying and selling indices, traders can speculate on the changes in price of the biggest companies in a single market. For example, the US 500 is one of the most widely traded indices globally – it is a measurement of some of the largest and most actively traded companies listed on the New York Stock Exchange or NASDAQ.

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Equities

Also known as share markets, these represent the prices of shares in companies that are listed (quoted) on major stock exchanges. Famous examples include Apple, BP or Microsoft.

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Sentiment

This is perhaps the most complex and important factor in a share price. Share prices tend to react strongly to expectations of the company’s future performance. These expectations are built on any number of factors, such as upcoming industry legislation, public faith in the company’s management team, or the general health of the economy.

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major stock indices apart from USA

FTSE100 UK

DAX Germany

CAC 40 France

IBEX 35 Spain

FTSE MIB Italy

Nikkei 225 Japan

Hang Seng Hong Kong

ASX 200 Australia

TSX 60 Canada

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Magor USA indices

Dow Jones Industrial Average (DJIA)-only 30 biggest companies

S&P500 - 500 companies 70% of USA stockmarket value

NASDAQ-100 non-financial companies (tech, comps, biotechnology)

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Types of commodities

Soft commodities: These are agricultural commodities, farmed rather than mined or extracted.

Hard commodities: These are generally mined from the ground, or taken from other natural resources.

Question: Oil and Gas hard or soft?

OTC

Over The Counter this means they are generally traded between dealers, acting on behalf of clients.

To Redeem

Pay back the principal (Bonds can be redeemed)

Financial spread betting

Betting on how the value of a financial asset will change in the future. In most cases, you’re betting on whether it will rise or fall. If you think the price of the asset will go up, you ‘buy’ (also known as going long). If you think it will fall, you ‘sell’ (go short).
It is derivative

When spread betting, you bet an amount of money per point on whether a market will go up or down. For instance, you might bet £5 per point that the price of the FTSE 100 will fall.

CGT

Capital Gain Tax

CFD

Contract For Difference
Similarly to spread betting, when you trade a contract for difference, or CFD, you’re not actually trading a physical asset. Instead you’re agreeing to exchange the difference in value of an asset between the point at which the contract is opened and when it is closed.

Contracts for difference are derivatives, as the price of a CFD is derived from the value of an underlying asset.

With CFDs you buy and sell contracts that represent a specified amount in the underlying market.
For example one standard FTSE contract might be worth £10 per point.

Derivatives

Производные от…

Underlying market

An underlying market is the market on which a derivative is based. This might also be called an underlying asset. You can trade derivatives contracts based on many underlying markets, from commodities such as oil and gold, to stock indices, to spot forex.

Order

Instruction to buy or sell an asset

Types of orders

Market orders Limit orders Stop orders Stop - Loss Stop - Entry Filled order (An order that has been executed is called a 'filled' order)

Market order

If you simply want to deal immediately at the best price available, a market order is the one to use. Provided the market is liquid enough - in other words, if there are enough willing buyers and sellers around at the time - your market order will be executed immediately.

Limit order

A limit order is an instruction to trade if a market's price reaches a particular level that's more favourable than the current price. This price will be below the current price if buying and above if selling.

Stop orders

A stop order is an instruction to trade if a market's price reaches a particular level that's more favourable than the current price. This price will be above the current price if buying and below if selling. If you are looking to trade with the trend and catch the momentum but want to wait for confirmation that the market is going to continue in the direction it is currently moving in , you'll need to use a Stop order.

What is the difference between Orders?

Need to find out in more details ?? Limit order: You instruct to trade when the price will be below the current price if buying and above if selling. Stop order: You instruct to trade when the price will be above the current price if buying and below if selling. Stop-Losses order: In contrast to a limit order, a stop order is an instruction to trade when the market hits a level less favourable than the current price. Stop-Entry: order to open a new position - known as a stop entry order. Placing an order to open a trade at a worse price than the current price might seem very strange, but sometimes it can make good sense (need further explanations). Trailing Stops: If the market price moves in your favour by a specified amount (known as a 'step'), the trailing stop copies this movement. So it keeps its distance from the current price, but step-by-step it gets closer to the price at which you opened your trade

Stop Loss

stop order is an instruction to trade when the market hits a level less favourable than the current price at the point beyond which the level of loss would be unacceptable to you, your stop will pull the plug and close out the position.

Trailing Stops

Trailing Stops: Like other stop-losses, a trailing stop is attached to a trade. If the market price moves in your favour by a specified amount (known as a 'step'), the trailing stop copies this movement. So it keeps its distance from the current price, but step-by-step it gets closer to the price at which you opened your trade, and may pass it if the favourable movement continues.

Order Durations

Good till cancelled (GTC) Good for the day (GFD) Good till date/time Fill or kill (FOK): If the order can't be filled in full immediately, it will be cancelled. Execute and eliminate: As much of the order as possible will be filled at the price you specify. Any remaining part of the order will be cancelled.

GTC

Good Till Cancelled (Order remains valid until you cancel it yourself or the order is filled. On some exchanges, the order may only be valid for a specified period, so it may be worth checking with your broker.)

GFD

Good For the Day (Order remains active until the end of the trading day on which you place it. Check with your broker to see when your chosen market closes.)

FOK

Fill Or Kill (If the order can't be filled in full immediately, it will be cancelled.)

Margin Calls

This means that, if a position moves against you, your provider may ask you to provide additional funds to keep your trade running.

NGMI

Never Going To Make It

BTFD

Buy The Fucking Deep

DOS AND DDOS

Dos - denial of service DDOS - distributed denial of services