By Gabriele Denaro · 1 October 2026
Bitcoin is the first decentralised cryptocurrency, created in 2009: it allows transactions between people without intermediaries. It runs on a blockchain, a distributed ledger, very hard to alter, that records transactions in blocks linked in chronological order. The maximum number of bitcoin that can ever exist is fixed at 21 million.
Ethereum is a platform that supports smart contracts, programs that run automatically when certain conditions are met. On this basis came DeFi (financial services such as lending and trading on a blockchain, without traditional intermediaries) and NFTs, non-fungible tokens that represent unique digital assets.
On networks that use proof of work, like Bitcoin, mining is the computational process that validates transactions and creates new blocks. In proof of stake, validation is carried out by validators who stake an amount of cryptocurrency and take part under the network's rules: the stake is an economic guarantee tied to their correct behaviour.
A wallet is a digital purse for storing, sending and receiving cryptocurrency. Access to funds depends on the private key; the seed phrase is a sequence of words that lets you restore the wallet. Whoever holds them controls the funds: keep them offline, never share, photograph or save them online. If you lose them, you may never recover anything.
An exchange is a platform for buying, selling and swapping cryptocurrency. On a "custodial" exchange the private keys are controlled by the exchange on your behalf: the balance you see may represent a claim on the platform, not funds you control directly. Hence the saying "not your keys, not your coins".
Operations on a blockchain have a cost: "gas fees" are charges for having a transaction processed, and vary with the operation and network congestion. Once confirmed, a transaction is generally irreversible: a payment to a wrong address is usually not recovered.
Cryptocurrencies are very volatile: prices can swing widely in a short time. HODL means holding your crypto long term; according to the most common account the term began as a typo of "hold" on a forum, later reinterpreted as "Hold On for Dear Life". Stablecoins try to keep a stable value against a reference (for example the dollar), but carry risks tied to the issuer and the reserves. Be wary of anyone guaranteeing high returns, of opaque projects (a "rug pull" is when a project is abandoned with the funds raised) and of anyone asking for your seed phrase: no legitimate service does.
General educational information, not personal financial, tax or legal advice. It may be incomplete or out of date. Terms of use.