More and more people are interested in trading coins, and many newcomers still don't know where to start. Today, I will share some basic knowledge about the cryptocurrency world with newcomers.
1. What is trading coins?
Trading coins means buying low and selling high to profit from the difference.
2. What is an exchange?
An exchange is a platform for trading digital currencies where you can trade coins and engage in contract trading.
3. What risks are associated with trading coins?
In terms of investment in cryptocurrencies, the most straightforward advice is not to invest any money you cannot afford to lose. Once again, I remind all newbies to act within their means and avoid borrowing money.
4. Is trading coins legal?
To date, there has been no law or regulation stating that trading coins is illegal!
Document 924 clearly states that trading virtual currencies is not illegal and does not constitute a crime.
5. What is USDT?
An exchange is a place used for trading Bitcoin and other digital currencies.
Trading digital currencies requires an intermediary coin, also known as stablecoins or USDT. USDT, the most commonly used fiat currency, is a virtual currency linked to the US dollar. It is stored in foreign exchange reserve accounts and backed by fiat currency support. You can simply understand it as US dollars.
6. What are mainstream digital currencies?
Mainstream coins are valuable coins, which refer to coins with higher market capitalization. Bitcoin is the leader, followed by Ethereum.
7. What risks should be noted when trading digital currencies?
When buying, if the payment account provided by the merchant is involved in fraud, transferring money to the other party will trigger a fraud alert. At this time, the fraud investigator will call or visit you to verify the situation, educate you on fraud prevention, and freeze all your bank cards for about a month.
If you encounter such a situation, don't be afraid. You haven't done anything wrong; the fraud investigator is just worried that you might be deceived and won't do anything to you.
When cashing out, the most important point is to avoid receiving black money. Once you receive black money, your bank card will be frozen, and to unfreeze it, you will need to return the fraudulently obtained funds.
In such situations, don't rush to claim compensation; seek professional help and apply for good faith income as much as possible. Aim to return as little as possible, or nothing at all.
8. Why might I receive black money?
Currently, many scammers are using the purchase of digital currencies to launder money.
One way is that scammers collaborate with coin traders. When you sell coins, the trader shares your card information with the scam group, which then instructs the victim to transfer money to you. If the victim reports it, you will be involved with black money.
One type is a legitimate coin trader. If they sell coins and receive black money directly, you buying coins from them and transferring to you constitutes secondary black money. The specific logic can be found in Sister Ning's article (Why will my card be frozen when trading U at the exchange?).
9. How can I safely cash out?
One option is to use a U card. If it's a small amount to cash out, you can get a U card for daily life expenses.
Another option is to find an over-the-counter coin trader who can provide unfounded compensation for frozen cards, ensuring that the source of funds comes from non-crypto e-commerce funds, only receiving and not selling; such transactions are relatively safe.
10. Do I have to pay taxes on the money earned from trading coins?
Trading virtual currencies is not illegal, but it is also not protected by law, so profits and losses are your own responsibility, and there is no tax on it.
Finally, Sister Ning does not recommend newcomers to trade contracts; accumulating coins is your only way out.