Cryptocurrency Beginner’s Essential Rules
Send Small Amount First To See If Everything Is Correct
We’re keep seeing people messing up their transactions which concludes in losing them. Number one thing to do, to prevent this happening, is to send a small amount of particular cryptocurrency first. If everything went smoothly without any problems, send the main amount. Yeah, this will cost you some extra fees in process, but it’s better to pay extra to be 100% safe. This rule doesn’t have to be applied when we’re transferring small amounts of money. It’s better to leave change on exchange than losing it all on gas fees during the process. “Not your keys, not your crypto.”
Make a Plan
Make a plan in beforehand and stick to it, no matter what. Don’t act on spontaneous emotions, when it comes to selling or buying. Don’t let your emotions overtake your actions. Always remember, in the first place, “WHY’D YOU INVESTED” before. Always be patient, the fear of missing out “FOMO” will let you buy high! Yes, it’s okay to change your attitude towards some coins, but don’t forget, what was your primary goal when you first started!
Do Your Own Research
DYOR. Don’t listen to what others say, always Do Your Own Research. Yeah, yeah, this one is mentioned everyday, everywhere 25/8. The thing is, it’s mentioned nonstop, just simply because it’s god damn TRUE. You should never, listen to anyone else when it comes to your money. Is the project liquid? Is it decentralised? Will it get adoption? If yes, when? Are they any future plans with it? These are kinds of the questions you have to look for. No YouTuber, millionaire, billionaire should manipulate with you !
Yes, I agree, sometimes you need to hear something from someone that you can lean on, but always, try to listen to their hindsight first, then do your own research and then decide what’s suits you the best. Sure, sure I know that papa MelonMusky is shilling one anonymous coin, but bear in mind, that he is the richest man ( troll ) in the world who doesn’t give a F about you or me. DO YOUR OWN RESEARCH
Invest What You Can Afford To Lose
Cryptocurrencies are highly volatile. You have to manage your money. Can crypto profitability be great? Yes. But is Bitcoin a safe investment? No. Are other cryptocurrencies necessarily a safe investment? No. Where there is extreme upside, there is also extreme downside.
Where the particular coin falls 20% during one trading day, it’s essentially just another day in the crypto world for most. If you are investing money you can’t afford to lose, you need to take a step back and re-think your current financial situation, and reconsider what you’re about to do.
Diversify. Don’t Put All Of Your Eggs In One Basket
Yes, yes. We hear you. If you would’ve put in all of your money through your years of investing only to Bitcoin you would now have billions. Right. True is, you would already pull out everything. Diversifying doesn’t mean owning ton of coins, it means to protect, minimize your risks of your portfolio, preventing it from full crashing.
Best way to diversify, is to put some money into some different kind of investment, not only in crypto. Try to give a chance to some stocks, bonds, gold. Yeah, the apy % is shit, but it is better than YOLO everything into crypto while there is a bull run. During bull run everything goes up. Buying shitcoins doesn’t mean that you’re diversifying, it’s gambling. Spread your risk.
Don’t Leverage Trade
Double edged sword. If you don’t know about it, stay away from it! Yeah, you can make some good trades, but in the end you will get demolished. While leverage can increase your trading power, it is very very risky. It amplifies the gains at the same rate as it amplifies the losses. Sure, you can leverage x20 with your 100$ and hoping for +20% on your favourite coin, but bear in mind, if your coin dips down atleast a small %, what is likely to happen, you’re liquidated. You’re fucked. Stick to spot trading, where basically leverage is set at 1:1.
Dollar Cost Averaging ( DCA )
Saint strategy. The best investment strategy when you’re going long term. While I agree, throwing a lump sum of money into particular coin can be way more profitable. Lump sum of money is better in Bull Market, while DCA is better during the Bear Market. DCA is the king, when it comes to minimizing the risks, reducing the volatility and managing your money without further stressful nights. It’s also known as a constant dollar plan. And yes, you can use Euros instead of Dollars.