For newcomers to the crypto world, it is strongly recommended to start learning with spot trading and only consider contracts after fully mastering it.
1. Why is spot trading more suitable for newcomers?
1. Risk level
Spot trading: Loss limit = Principal to zero (e.g., with 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 mastery of:
✅ Trading operations
✅ Basic market analysis
✅ Wallet transfers
Contracts require additional mastery:
❗️ Leverage selection
❗️ Margin calculation
❗️ Liquidation price warning
❗️ Funding rate arbitrage
3. Psychological impact
Spot trading volatility is relatively mild, suitable for developing market perception
The extreme volatility of contracts can easily lead to emotional trading (a common fatal flaw for newcomers)
2. The hidden thresholds of contracts (easily overlooked by newcomers)
1. Differences in exchange mechanisms
Differences between full margin and isolated margin models
Differences between U-based and coin-based contracts
Difference between mark price and latest price
2. Hidden costs
Funding rate (charged every 8 hours, long-term positions may accumulate high costs)
Slippage issue (a small price difference triggers liquidation when using high leverage)
3. Complexity of strategies
Simple spot trading strategies: Dollar-cost averaging, gradual profit-taking
Contracts should be paired with: Hedging, grid trading, swing trading, etc.
3. Suggested learning path (in stages)
Stage 1: Spot basics (1-3 months)
Essential learning content
Buy BTC/ETH from the exchange
Learn to check the top 50 ranked tokens
Understand basic indicators such as market capitalization, circulating supply, and trading volume
Practical operation goals
Complete over 10 spot trading transactions
Try to transfer tokens from the exchange to your wallet
Practical operation goals
Stage 2: Contract attempts (after 6 months)
Prerequisites
Sustained profit from spot trading for over 3 months
Can accurately explain concepts such as 'funding rate' and 'liquidation price'
Safety strategies
Initially use leverage below 5x
Do not risk more than 2% of your principal in a single trade
Must set stop-loss
Establish your own trading discipline (such as profit-taking and stop-loss rules)
Participate in a bull market cycle to observe market sentiment
4. Key suggestions
1. Beware of 'get-rich-quick traps'
Those who flaunt contract profits on social media usually do not display more liquidation records
2. Remember two formulas
Spot trading loss speed: Principal × Price drop of the asset
Contract loss speed: Principal × Leverage × Price drop of the asset
5. Common questions for newcomers
Q: What should I do if I see someone making tens of thousands in contracts a day?
A: Statistics show that 98% of contract newcomers lose money within 6 months; survivor bias makes you only see the winners.
Q: When can I start learning about contracts?
A: When you can answer the following questions:
Why does Bitcoin halving affect the price?
What is the Gas fee mechanism for Ethereum?
How to determine if a project's TVL is real?
Summary: The first principle of survival in the crypto world is to stay alive, and spot trading is the best starting point for learning. Once you have enough understanding of the market, contracts will naturally become tools rather than gambling devices. Of course, you can also consult the veteran; plan for spot trading in a bull market and share contract secrets.
