I. Basic Knowledge
1. Trading Characteristics: Cryptocurrencies differ from stocks; trading occurs 24 hours a day, with no price limits; prices can drop to zero, as LUNA did, plummeting 99.9% overnight.
2. Core Concepts
- Blockchain: public ledger, transaction records cannot be altered, but the project team may run away.
- Wallets: There are cold wallets (hardware) and hot wallets (mobile/computer software); mnemonic phrases are very important, as losing them means losing your coins.
- Gas Fees: Transfer fees; they can sometimes exceed the transfer amount during congestion on the Ethereum network.
3. Common Cryptocurrencies
- Bitcoin (BTC): The gold of the crypto world, with relatively low volatility.
- Ethereum (ETH): A smart contract platform with many ecosystem projects.
- Stablecoins (USDT/USDC): Pegged to the dollar, used for hedging, but USDT has a history of issues.
II. Safety and Scam Prevention
1. Deadly Operations to Avoid
- Don’t store your mnemonic phrase in screenshots on cloud drives; hackers love to target them.
- Don’t click on 'official' airdrop links; 90% are phishing sites.
- Don’t follow 'teachers' for contract trading; this is a common scam.
2. Identify Scam Projects
- Projects with rough official websites, exaggerated whitepapers, and anonymous teams are dangerous.
- An annualized return rate over 50% is likely a scam.
- Steer clear of coins that mimic famous names (like those with 'Elon' or 'Satoshi').
3. Trading Precautions
- Choose top 10 global exchanges like Binance, Gate.
- Long-term holding can allow you to transfer coins to your own wallet; leaving them on exchanges may risk account freezing.
III. Introduction to Trading
1. Three No's for Newcomers
- When trading contracts, only use a small amount of your total position, ideally less than 10%.
- Don’t go all in on one coin; even for coins you are confident in, don’t exceed a 20% position.
- Don’t chase prices or panic sell; chasing highs can lead to being trapped.
2. Fund Allocation: 50% for major coins (BTC/ETH), 30% for stablecoins, 10% for small coins (like buying a lottery ticket), and 10% for practicing contracts.
IV. Risk Warning
1. Market Risks: A bull market can also experience crashes; for example, Bitcoin dropped 30% in a single day on May 19, 2021.
2. Altcoin Risks: High probability of going to zero; 99% of projects do not last more than 3 years.
Final Advice
You can make money in the crypto world, but the profits come from those who have knowledge and patience. If you don't have a good mentor, start with a small amount to test the waters; treat losses as tuition and don’t get arrogant if you make a profit. Remember, 'You lose money quickly in a bull market, and practice your skills in a bear market.' Surviving two bull-bear cycles qualifies you to call yourself a crypto player!
