5 Things Beginners Need to Know About Cryptocurrency

The recent cryptocurrency crash is not the first time. If you examine the discourse on bitcoin, you will see that every crash is accompanied by a strong recovery. The crash may not be the worst thing that happens. The worst thing is seeing the market rise again and then reminiscing and saying, 'If only I had bought some coins at that time'.

Talking about cryptocurrencies can make people around you feel like you've lost your mind. I constantly receive emails with questions - isn't this a bubble? Is this kind of investment ethically legitimate? This is gambling... and I'm tired of answering those questions. However, I've tried to compile this article for beginners, especially millennials, who are amazed by the wonders of the cryptocurrency world. Oh my! You can make a lot of money with cryptocurrency, in fact, a 1000% profit in one year is quite common in the cryptocurrency universe. However, it's also easy to lose all that money in the blink of an eye. Here are some tips for those who want to get involved. Research Before Investing The first step in understanding cryptocurrency is to understand the basic technology - blockchain. Forget about the technical terms. No one needs to convince you of the revolutionary nature of blockchain technology. A good starting point is to read articles, check online forums, and watch vlogs discussing cryptocurrency. You will soon discover why governments and corporations are exploring this new technology and how they are trying to integrate it into their systems, or why banks are afraid that blockchain and cryptocurrency are a threat to their existence and trying to suppress its development. This perspective will broaden your vision to learn and see the potential of blockchain technology. Another important thing is not to make a mistake by trusting someone else with your money; it defeats the whole purpose of cryptocurrency, which was created to empower people with true ownership of their money without having to trust any third party like a bank. Scammers often take advantage of the naivety of newcomers to this unregulated market. Therefore, this requires utmost caution. Only Invest the Amount of Money You Are Willing to Lose During my extensive research in the early days, I realized a very important principle in the cryptocurrency market - only invest what you are willing to part with. The reason is that the market is extremely volatile, driven more by market sentiment and psychology than fundamental factors. This makes the cryptocurrency market extremely risky; that's why you have the potential to make a lot of money or lose it all in an instant. In modern finance, this is illustrated by the relationship: Risk = Reward (Investments with risks tend to bring you higher profits) Always be cautious and do not mortgage or borrow money to invest in cryptocurrency; you are only signing your own death sentence. Focus on Long-Term Goals Cryptocurrency is not a "get rich quick" scheme. Don't just have the mentality of pursuing short-term profits, especially when you lack the necessary trading or technical skills. The reality is that many people in the cryptocurrency market don't know what they are investing in and only participate for short-term profits. This is the formula for disaster. The requirement is that all investment decisions must be based on careful consideration and patience. Don't be the person who had 1700 BTC when it was worth 0.06 dollars. He sold it for 0.30 dollars and then lamented when it reached 8.00 dollars. This was in 2011. Hodl - or hodling - is a cryptocurrency slang term referring to the act of holding onto your coins or tokens regardless of the circumstances; whether it be during a market downturn or a strong correction. You should always focus on the long term, as the technology supporting cryptocurrencies is still in its early stages and it may take a while before various technologies and improvements in the cryptocurrency ecosystem are ready for widespread adoption. Short-term trading in this highly volatile market can be disastrous, especially if you do not have any trading expertise. Diversify Your Investment Portfolio Your cryptocurrency investments should be allocated proportionally across the market. There are over 1,600 different coins and tokens in the cryptocurrency space. Bitcoin (BTC) and Ethereum (ETH) are the oldest and largest cryptocurrencies, and they are also the base currencies of the cryptocurrency world. Therefore, you should always allocate a significant portion of your investment to both of these currencies as they are relatively stable and facilitate easy exchange with other alternative cryptocurrencies. After that, the remaining portion should be allocated to altcoins with value potential to disrupt their space. Look for coins solving real-world problems, not shitcoins. You must learn to identify shitcoins and coins with good fundamentals. Shitcoin is a term for coins with no good foundation and created for the purpose of scamming the public. They are often associated with 'pump-and-dump' and ponzi schemes, and are a great way to lose your money. Track Your Profits and Losses When starting out, I didn't pay attention to the amount of satoshi a coin is worth. I just saw those numbers being randomly controlled by bots. On the contrary, those numbers determine the value of your coin at any given time. The key to profit in this field is to buy at a low price and sell at a high price. You need to be attentive when placing orders and also observe when the market moves in an upward trend to calculate your profit. DYOR! #Write2Earn #Write&Earn $BTC {spot}(BTCUSDT)