Understanding Risk in Crypto Markets

Before managing risk, one must understand the types of risk present in crypto trading:

- Market Risk: Price volatility can lead to sudden losses.

-Liquidity Risk: Thin order books on smaller exchanges or altcoins may prevent easy entry/exit.

-Security Risk: Hacks, phishing attacks, and exchange collapses.

-Regulatory Risk: Laws can change rapidly, affecting coin legitimacy and availability.

-Emotional Risk: FOMO, fear, and overconfidence can lead to impulsive decisions.

Emotional risk is the most powerful because it affects your decisions regardless of how smart your strategy is.

You can manage other risks with tools and research, but you can’t automate your emotions.

💡 Mastering your mindset is the ultimate edge in crypto. SO JUST BE CAREFUL!!!