Which is more suitable for learning in the crypto space?
For newcomers to the crypto space, it is strongly recommended to start learning from spot trading, and only consider engaging in contracts after fully mastering it.
1. Why is spot trading more suitable for newcomers?
1. Risk Level
Spot: Loss limit = Principal goes to zero (e.g., if 1000 yuan, maximum loss is 1000 yuan)
Contracts: Possible liquidation and negative balance (the higher the leverage, the greater the risk; a 10% drop with 10x leverage results in a 100% loss)
2. Learning Curve
Spot trading only requires mastering:
✅ Buy and sell operations
✅ Basic market analysis
✅ Wallet transfers
Contracts require additional mastery:
❗️ Leverage selection
❗️ Margin calculation
❗️ Liquidation price alerts
❗️ Funding rate arbitrage
3. Psychological Impact
Spot trading fluctuations are relatively mild, suitable for developing market perception.
Contract fluctuations can lead to emotional trading (a common fatal flaw for newcomers).
2. Hidden Thresholds of Contracts (Easily Overlooked by Newcomers)
1. Differences in Exchange Mechanisms
Full margin/Isolated margin mode differences
Differences between USDT and crypto-denominated contracts
Differences between mark price and last price
2. Strategy Complexity
Simple strategies for spot trading: Dollar-cost averaging, partial profit-taking
Contracts require combinations: Hedging, grid trading, swing trading, etc.
3. Suggested Learning Path (Phased)
Phase 1: Basic Spot Trading (1-3 months)
Essential Learning Content
Buy BTC/ETH through an exchange (Binance recommended)
Understand basic indicators such as market cap, circulation, and trading volume.
Practical Objective
Complete more than 10 spot trades.
Attempt to transfer tokens from the exchange to a wallet.
Practical Objective
Phase 2: Contract Experimentation (After 6 months)
Prerequisites
Sustained profitability in spot trading for over 3 months.
Can accurately explain concepts such as “funding rate” and “liquidation price.”
Safety Strategies
Initially only use leverage below 5x.
Single trade should not exceed 2% of the principal.
Must set stop-loss.
Establish personal trading discipline (e.g., profit-taking and stop-loss rules).
Participate in one bull market cycle to observe market sentiment.
4. Key Recommendations
1. Start with a simulation account
Binance offers a contract simulation trading feature; it is recommended to simulate for at least 1 month before going live.
2. Beware of the “Get Rich Quick Trap”
Those showcasing contract profits on social media often do not display more liquidation records.
3. Remember Two Formulas
Spot loss speed: Principal × Price drop
Contract loss speed: Principal × Leverage × Price drop
