First, it is important to clarify: Hemi is not a place to make quick money by trading coins; it is a technology-driven L2 project suitable for players who are willing to participate deeply. If you just want to buy coins and wait for the price to rise, you can go directly to the exchange to buy HEMI spot, no need to mess with the chain.
But if you want to participate in the Hemi ecosystem, experience Bitcoin DeFi, or lay low for some early opportunities, then you need to do your homework seriously.
Step 1: Prepare a wallet. Hemi is EVM compatible, so you can use MetaMask. But there is a detail: you need to manually add the Hemi network. Open MetaMask, click on network selection, choose 'Add Network', and then enter:
Network name: Hemi Network
RPC URL: Check the official website for the latest (this can change, don't use my old address)
Chain ID: 43111
Currency symbol: ETH
Block explorer: explorer.hemi.xyz
After adding the network, you can operate on the Hemi chain. But don't rush, don't deposit money right away.
Step 2: Understand cross-chain methods. Hemi has its own Tunnels system and also supports third-party bridges like Stargate and Meson. Beginners are advised to use Stargate or Meson, as they have user-friendly interfaces and fast speeds. The official Tunnel is safer, but the operations are complex and suitable for experienced users.
When cross-chaining, pay attention to the following points:
Transferring from Ethereum to Hemi is quick, taking just a few minutes. But withdrawing from Hemi back to Ethereum takes 90 minutes to 2 hours, which is a security design of the PoP mechanism and cannot be accelerated.
Regarding gas fees, the transaction fees on Ethereum L1 cannot be avoided, usually costing $10 to $20. However, operations on the Hemi chain are almost free, costing less than 1 cent per transaction.
Don't transfer too much money at once. Start by transferring $100 to test the waters, and after familiarizing yourself with the process, increase the amount.
Step 3: Choose application scenarios. What can you do on the Hemi chain? There are several main directions:
Liquidity mining: Some DEXs and lending protocols offer very high APYs, some reaching 20% to 50%. But be careful, high returns often mean high risks. Most of these earnings come from token incentives, not real protocol income. Once the incentives end, APYs will plummet.
Cross-chain arbitrage: There may be price differences between Hemi and other chains, theoretically allowing for arbitrage. However, practical operation is very difficult because cross-chain has time costs and transaction fees, and a slight misstep can lead to losses. Beginners should avoid this.
Bitcoin Tunnel experience: If you have BTC, you can try Hemi's Bitcoin Tunnel to transfer BTC to the chain and participate in DeFi. But I don't recommend beginners to play with this right away. Bitcoin Tunnel is still in the early stages, with incomplete functions and higher risks. Wait until it matures a bit more before trying.
PoP mining: Hemi has a PoP mining mechanism that does not require professional mining machines; ordinary computers can participate. However, the earnings are very low, possibly just a few cents to a few dollars per day, and you need to lock up HEMI tokens. This is more like a way to participate in the ecosystem; do not expect to make money from it.
Step 4: Pay attention to risks. As a new project, Hemi has many risk points:
Smart contract risk: Although the official bridge has been audited, third-party protocol contracts may have vulnerabilities. Don't put all your assets in one protocol; diversify your holdings.
Liquidity risk: The liquidity on the Hemi chain is not deep enough, and large transactions may have high slippage. I once tried to exchange $100,000 USDC for USDT, and the slippage was actually 1.5%, resulting in a loss of $1,500. Therefore, large transactions must be simulated first to see what the slippage is.
Withdrawal delay: As mentioned earlier, withdrawing from Hemi back to Ethereum takes 90 minutes. If you urgently need money, this time may make you anxious. So don't put all your liquid funds on Hemi.
Token risk: The circulation rate of HEMI tokens is very low, only 10%. A large number of tokens unlocking in the future will exert selling pressure on the price. If you hold HEMI, you must always pay attention to the unlocking schedule.
Project risk: Hemi is currently at Stage 0, meaning it is highly centralized, and the team has complete control over the chain. Theoretically, the team can freeze your assets or modify the rules. Although the probability is low, it is not non-existent. This is a common issue with all early L2s.
Step 5: Capital management. Don't put all your assets all in Hemi. My suggestion is that the position in Hemi should not exceed 5% to 10% of total assets. Also, build positions in batches, don't go all in at once.
If you have $10,000 in crypto assets, you can allocate it like this:
$5,000 placed in mainstream coins like BTC and ETH
$3,000 placed on mature L2s like Arbitrum and Optimism
$1,000 placed on emerging L2s like Hemi
$1,000 reserved for emergency funds
The benefit of this allocation is that even if Hemi goes to zero, you won't be severely hurt. And if Hemi really takes off, an investment of $1,000 can also bring considerable returns.
Step 6: Continuous learning. Hemi's technical architecture is quite complex, including hVM, PoP, Bitcoin Kit; these concepts cannot be understood in a day or two. It is recommended to go to the official Discord or Telegram group and communicate more with experienced players in the community. If you encounter problems, search first to see if anyone has encountered the same issue.
Additionally, regularly check Hemi's official blog and Medium articles to understand the latest developments. The project team often releases important updates, such as new partners, protocol upgrades, token unlocking plans, etc. This information is crucial for investment decisions.
Step 7: Don't let FOMO cloud your judgment. The biggest enemy in the crypto space is FOMO (fear of missing out). When you see others making money, you can't help but want to follow suit. But those who follow along often become the ones left holding the bag.
Hemi indeed has a certain degree of popularity right now, especially after Binance went live in September, many people flocked in. But the heat will fade, and prices will fluctuate. Don't get excited just because you see HEMI rise by 50%, and don't panic just because it dropped by 30%. Stay calm and operate according to your plan.
Lastly, any investment carries risks, and cryptocurrency is particularly high risk and high reward. Hemi, as a new project, has greater uncertainty. If you cannot bear the risk of losing everything, then don't touch it. If you are willing to take risks, then do your homework and invest rationally.
Remember: The most important thing in investing is not how much money you make, but not to lose a lot of money. Preserve your principal, wait for opportunities, and that is the way to survive in the long term.