The most common pitfall for newcomers to the cryptocurrency world isn't technical issues, but rather assumptions—they assume "buying crypto = making money." This leads to either being scammed by the platform or being trapped by their own greed. Today, we'll explain four essential things newcomers should know in plain language; after reading this, you'll be able to avoid at least 80% of these pitfalls.
1. Opening an account: Choosing a platform = choosing your wallet, these 3 points must be paid close attention to
The first step in cryptocurrency trading is not buying the coins, but choosing the right platform. There are too many cases of illegal platforms running away with money and hackers attacking. New traders must remember: security > fees > features.
Give priority to the leading platforms: Binance, OKX, and Huobi (these three have many users, strong compliance, and the ability to compensate even if problems arise).
Real-name authentication is a must: Don’t be bothered by it. Real-name authentication not only allows you to withdraw money, but also reduces the risk of your account being stolen (a non-real-name account is basically impossible to recover if it is lost).
Be wary of the temptation of "high rebates": those small platforms that claim to "give away coins when you register" or "return 90% of transaction fees" are mostly phishing scams, and you may be harvested if you enter.
2. Trading: Beginners should start with these 3 steps, don’t go all-in right away
Only use official channels for deposits: deposit directly into the platform using a bank card or Alipay (don't transfer funds privately to anyone else as a "top-up"—it's 100% a scam). After depositing, convert the funds into USDT (a stablecoin, the "cash equivalent of the crypto market"), then use USDT to buy other cryptocurrencies.
Only touch mainstream currencies: In the first three months, only buy Bitcoin (BTC) and Ethereum (ETH) - these two are like the "large-cap stocks" in the currency circle. Although they rise slowly, they are relatively resistant to falling, at least they will not suddenly return to zero.
Don’t rush into the action: Before buying, check the “best bid price” and “best ask price” (the current transaction price), and use a “market order” to complete the transaction quickly (newbies should avoid using “limit orders”, as they may not be able to buy or sell due to price fluctuations).
3. Mindset: 5 “Life-Saving Mentality” More Important Than Technology
80% of cryptocurrency losses are caused not by a lack of understanding of the market, but by a lack of self-control. Remember these five things to minimize losses:
Don't be tempted by "get-rich-quick" scams: Just because someone says "this coin will increase 10x," do you jump in? 99% of "hundred-fold-billion-dollar coins" are scams, and newbies are just throwing money away.
Stop-profit and stop-loss should be "mechanically executed": before buying, think about "how much the price will rise to sell" and "how much the price will fall to sell" (for example, sell half when you make 20%, and sell all when you lose 15%). Don't wait until the price falls to think "wait a little longer", and don't hope for "more increase" when the price rises.
Don't watch the market every day: With 24/7 trading in the cryptocurrency market, new traders can easily become addicted to watching the market, becoming ecstatic when prices rise and panicking when prices fall, leading to reckless trading. It's recommended to watch the market for no more than one hour per day; the more you watch, the more likely you are to make mistakes.
Don't put all your eggs in one basket: use 1,000 yuan to test the waters, use 700 yuan to buy BTC/ETH, use 200 yuan to buy platform coins (such as BNB), and keep 100 yuan as "emergency funds". If the price drops, you can make up for it, and if it rises, you can also make a profit.
Don’t believe in “inside information”: Whether it’s a “teacher” in the group or a so-called “internal channel”, 90% of those who tell you to “buy quickly” want you to take over. If there is a good opportunity, they would have already bought it themselves.
4. Final reminder: These 3 things are more important than making money
Only use your spare cash: Invest your groceries and rent? A market drop will impact your life, ruin your mentality, and lead to chaotic trading. Only use money you can afford to lose without worrying about losing it all to stay rational.
Don’t use leverage/play with contracts: For a novice, using leverage is like an elementary school student playing with a lighter – 100x leverage may seem like a “small investment for a big return,” but a 1% drop will result in a margin call, and the probability of losing all your money is over 95%.
First learn to "survive," then learn to "make money": The cryptocurrency world isn't short of opportunities; what's lacking is people with the capital to invest. Don't worry about how much you'll make in the first six months; if you can avoid or minimize losses, you're winning.
The cryptocurrency world is like a quack, so newbies shouldn't expect to "get rich quick." Spend three months familiarizing yourself with the rules, trial and error with a small amount of capital, and then gradually increase your investment once you've gotten a feel for the dynamics. Remember: those who make money in the cryptocurrency world over the long term aren't the most adventurous gamblers, but rather those who understand risk management best.
If you have any specific operational questions, please leave a message and let's avoid pitfalls together. Investing is risky, so you must be cautious when entering the market.
Focus today: IL V GAS LT C
