The block reward is the payment that is offered to a node that is securing the blockchain. In the case of Bitcoin, which has a Proof-of-Work consensus algorithm, these could be the miners. The payment is in the form of the native cryptocurrency in that blockchain. The amount is a predetermined reward for each block, but often that is supplemented with the fees that are paid for the transactions that the block holds. In Bitcoin, the current block rewards are cut in half every four years. This is called the ‘halvening’.
Slippage is the difference between a quoted trade price and the price at the time the order is filled. A price increase that happens before executing an order is considered negative slippage, whereas a price decrease is considered positive slippage for purchase orders. The negative and positive for sell orders are inverse. Slippage, to varying degrees, is a concern in all financial markets, including forex and the stock market. Slippage is a worry in the cryptocurrency space due to the market's high volatility combined with delayed order processing on blockchains. Slippage can also occur as a result of insufficient order book depth to maintain big orders in illiquid assets, resulting in a "split order" divided into separate price points. Traders can do a market analysis before placing orders and use limited orders to decrease risk slippage.
Due diligence is the process of consideration expected of individuals or businesses prior to entering into an agreement or contract. The phrase is often used in finance to characterize the study of prospective possibilities and risks, particularly in the context of investments and mergers, prior to acquisitions and asset transfers. The growth of new currencies, the majority of which are formed without a controlling authority to prevent fraud, poses a significant concern in the cryptocurrency space. Furthermore, real cryptocurrencies are frequently unpredictable, with considerable price fluctuations over short time periods. Given this, it is suggested that due diligence be performed prior to making an investment. Investigations may include chart analysis, forecasting, business-model and white paper analysis, assessing the validity of partnerships, doing research on team members, and so on.
Two-way pegs are the devices that connect main chains to sidechains. Sidechains are used by blockchains to increase scalability and efficiency. A 2WP closes the cash on the main chain while opening the same amount on the sidechain, giving the appearance of a transfer. When a trader relocks the money on the sidechain, it becomes accessible on the main chain again.
Blocks are file containing data which is linked together in a chain to form a blockchain. Used to record information, the block is like a ledger page. In the Bitcoin blockchain, each block contains a cryptographic hash code, a hash from the previous block, a timestamp, a signature, and additional data. New blocks are connected to previous blocks in chronological order. Whether each new block is validated or not is determined by an algorithm, usually proof of work or proof or Stake. These approaches are based on a peer-to-peer networks to verify block content before publishing.
Bitcoin is the most popular cryptocurrency in the world. Created in 2008, it was the first digital currency to use a peer-to-peer network powered by its users that did not rely on central authorities or a single regulatory person. Despite its popularity, Bitcoin is not considered an official tender by most governments and major banks.