Cryptocurrency trading is a high-risk investment. Don’t ever fantasize about getting rich overnight. The key is to learn how to survive in the market first.
Many novices rush in as soon as they see others making money, and end up being severely punished by the market. If you are a complete novice, this guide can help you avoid detours.
Step 1: Choosing the right trading platform is the basis
The trading platform is like a "tool" for cryptocurrency trading, and it is important to choose the right platform.
Be sure to go to the official website to download software. Don’t believe in Baidu advertisements or links recommended in groups, as they are likely to be phishing websites.
After registration, you must complete real-name authentication so that you can recharge and trade normally. Remember, never enter your account password on an unknown APP or website to prevent being deceived.
Step 2: Understand the basic concepts before getting started
Before entering, learn these basics:
Bitcoin (BTC): The benchmark of the cryptocurrency market, similar to digital gold, price fluctuations affect the entire market
Ethereum (ETH): The leader of smart contract platforms, supporting the development of DeFi, NFT and other ecosystems
Altcoins: Other currencies besides Bitcoin and Ethereum, such as SOL, BNB, etc.
Stablecoins: Currencies pegged to the US dollar, such as USDT and USDC, are mainly used for trading and hedging.
Bull market and bear market: The cryptocurrency market has obvious cycles. It is easy to make money in a bull market, and it is suitable for investment in a bear market.
Step 3: Getting started with practical operations should be steady and steady
The safest strategy for beginners: regular investment in BTC/ETH
Don't think about getting rich overnight when you first enter the market. It is recommended to adopt the "fool-proof fixed investment": take out a fixed amount of money every month, such as 500 yuan, and buy BTC or ETH on time regardless of whether it rises or falls, and stick to it for 1-2 years. The reason for choosing these two currencies is:
BTC: The core asset of the market. Historical data shows that holding for more than 4 years can basically make money.
ETH: Smart contract leader, an important pillar of Web3 ecosystem
Spot vs. Contracts: Newbies Should Stay Away from Contracts
Spot Trading
Use stablecoins to buy coins directly, which is suitable for long-term holding or swing trading, and has lower risks
Contract Trading
You can go long or short, and it has leverage. The risk is extremely high, so novices should avoid it.
Avoid common beginner mistakes
Don’t hold a large position in a single currency to avoid being stuck.
Don't buy at high prices, as there is often a risk of a pullback after a sharp rise.
Reduce frequent operations, as fees and slippage will eat up profits.
Don’t trust insider information easily, most of it is a scam to cheat you.
Stay away from high-leverage contracts, as your position could be liquidated in an instant.
Step 4: Risk management determines how far you can go
Reasonable control of positions
Don’t invest all your money at once. It is recommended to use 30%-50% of your money for trading at most, and keep the rest as a reserve fund. For example, if you have 10,000 yuan, you can only take out 3,000-5,000 yuan to enter the market.
Set up stop loss and take profit
Take Profit
When the profit reaches a certain percentage, such as 50%, you can sell part of it to lock in the profit.
Stop Loss
When the price falls below the key support level, sell decisively to stop loss. Preserving the principal is more important than anything else.
Remember: making money in the cryptocurrency world = principal × volatility × time. If you lose all your principal, no matter how good the market is, it will have nothing to do with you.
Step 5: Grasp the market trend to make a profit
The right strategy for bull and bear markets
Bull Market
Dare to hold positions and enjoy the rising market, but don’t be greedy and quit when you see good results
Bear Market
Patiently look for high-quality assets and wait for the market to pick up by investing at low levels
Focus on hot topics
The cryptocurrency world has different hot spots every year:
2021: DeFi, NFTs, Meme Coins
2023-2024: Layer2, AI concept, Meme coin, Solana ecosystem
Possible trends in 2025: RWA (real-world assets on-chain), ZK (zero-knowledge proof), BTC ecosystem
Hot spots may indeed bring high returns, but you must participate rationally and avoid blindly following the trend. Finally, I remind you again: cryptocurrency speculation is high-risk, so you must do your homework before investing and operate with caution.