In fact, the introductory knowledge for newcomers in the cryptocurrency circle is not complicated, but many friends do not understand the basic gameplay in the cryptocurrency circle!
Therefore, today Vitalik is here to share some introductory knowledge for newcomers to the cryptocurrency circle in hopes of helping everyone. Let's take a look at the analysis of this issue together!
1. Basic knowledge of the cryptocurrency circle, suitable for newcomers to read, but there is quite a lot, so please read patiently!
What does the cryptocurrency circle mean?
The so-called cryptocurrency circle is a natural community formed by digital currency players. The cryptocurrency circle is not large, but the number of people is not small, and within the crowd, it is basically a niche group. However, it is indeed a circle; few people make money, and the various ways to make money have been rapidly copied, including ICOs, trading coins, mining, exchanges, project parties, and self-media.
Which are the mainstream coins in the cryptocurrency circle?
BTC (Bitcoin) ETH (Ethereum) XRP (Ripple, the Wave Goddess)
BCH (Bitcoin Cash, Big Prince) EOS (Yuzu) LTC (Litecoin, Spicy条).
How to make money in the cryptocurrency circle?
There are many ways to make money in the cryptocurrency circle, mainly through trading coins, ICO crowdfunding, arbitrage, contracts, etc.
Which exchanges are best for operation?
Spot exchanges: Binance, Huobi, OKEx, Bter (most well-known and secure).
Futures exchanges: OKEx, BitMEX, Huobi (most well-known and secure).
Where can we usually look for news in the cryptocurrency circle?
Market websites: Feixiaohao, MyToken, Alcoin, etc.
News websites: Jinse Finance, Babit Community, Coin World News.
What does fiat currency mean in the cryptocurrency circle?
Fiat currency is legal tender issued by the state and government, guaranteed solely by government credit, such as the RMB, USD, etc.
What does token mean in the cryptocurrency circle?
Token, usually translated as '通证'. Token is one of the important concepts in blockchain, more widely known as 'digital currency,' but in the perspective of professionals in the 'chain circle,' its more accurate translation is 'rights certificate,' representing a type of rights proof on the blockchain rather than currency.
Three elements of a token
First, digital rights proof; tokens must exist in digital form as rights certificates, representing a right and an inherent and intrinsic value.
Second, encryption; the authenticity, tamper-proof nature, and privacy protection capabilities of tokens are guaranteed by cryptography.
Third, the ability to circulate within a network, allowing for verification anytime and anywhere.
What does building a position mean in the cryptocurrency circle?
Building a position in the cryptocurrency circle, also known as opening a position, refers to the act of a trader newly buying or selling a certain amount of digital currency.
What does going all in mean in the cryptocurrency circle?
Going all in in the cryptocurrency circle means putting all your principal into investments.
What does airdrop mean in the cryptocurrency circle?
Airdrops are currently a very popular marketing method for cryptocurrencies. To let potential investors and cryptocurrency enthusiasts receive information related to tokens, token teams frequently conduct airdrops.
What does locking up mean in the cryptocurrency circle?
Locking up generally refers to investors opening a new position opposite to their original position when the market trends against their operation after buying and selling contracts. It is also known as hedging or locking, even euphemistically referred to as butterfly flying.
What does candy mean in the cryptocurrency circle?
Cryptocurrency candies refer to various digital currencies that are issued for free to users during the ICO stage, serving as a promotional tool for the issuing party of the virtual currency project.
What does breaking below mean in the cryptocurrency circle?
Breaking refers to falling below, and issuing refers to the issuance price of digital currency. Breaking in the cryptocurrency circle means that a certain digital currency has fallen below its issuance price.
What does private placement mean in the cryptocurrency circle?
Private placement in the cryptocurrency circle is a way to invest in cryptocurrency projects and is also the best way for the founders of cryptocurrency projects to raise funds for platform operations.
How to read K-lines in the cryptocurrency circle?
Candlestick charts, also known as candlestick charts, Japanese lines, yin-yang lines, bar lines, red-black lines, etc., are commonly referred to as "candlestick charts." They are drawn based on the opening price, highest price, lowest price, and closing price of each analysis period.
What does arbitrage mean in the cryptocurrency circle?
Arbitrage means buying digital currency from exchanges with lower prices and then selling it on exchanges with higher prices.
What does ICO mean?
Initial Coin Offering, derived from the concept of Initial Public Offering (IPO) in the stock market, is a fundraising behavior where blockchain projects exchange their issued virtual currency for commonly used virtual currency in the market, as well as IEO, STO, etc., which are quite similar in pattern.
Five major investment rules
1. Consider and observe projects from multiple perspectives; do not follow the crowd blindly. There have been many copycat projects that aim to raise funds in the cryptocurrency circle, and once the founders run away, there is no way to hold them legally accountable.
2. Understand blockchain-related knowledge, know the industry pain points that blockchain solves, before entering the cryptocurrency circle.
3. For the projects you wish to invest in, you must fully understand them. Verify whether the project genuinely utilizes blockchain technology, whether its founder has disclosed their identity and has a legitimate background, whether the project's business logic closely relates to the token, and whether similar projects in the same industry are already solving industry pain points. If the project successfully launches, determine whether it has the ability to generate profits in real life.
4. If you cannot accurately assess the prospects of a coin, do not invest more than 20% of your assets when participating in blockchain investments, and do not put all your eggs in one basket.
5. Quality projects will also experience fluctuations; maintain a calm mindset. For the investment projects you believe in, do not pay too much attention to the price in the short term. Focus on whether the team's development progress aligns with the white paper. Additionally, only by holding long-term can you ultimately earn more returns.
Top ten trading rules.
First, do not easily get deceived by low-priced chips; maintain firm belief and prevent market manipulators from colluding to drop the price.
Second, chasing prices and killing dips; going all in and out is always a big taboo. If the big trend is favorable, building positions in batches during a decline is lower risk, lower cost, and greater profit than chasing prices.
Third, reasonably allocate profits to maximize the release of funds instead of constantly increasing positions.
Fourth, in situations of rapid price increase, cash out; in situations of rapid price decrease, hold your coins. Always maintain a proper mindset; do not speculate, do not be restless, do not be greedy, do not fear, and do not engage in unprepared battles.
Fifth, the front-end ambush or private placement of low-priced coins relies on experience and speculation about the future of these coins by market manipulators, while the subsequent secondary market game relies on technology and information to follow the manipulators. Do not get the main and the secondary mixed up, or it will end in confusion.
Sixth, when building positions and exiting, it is essential to layer and segment, gradually widening the price levels, effectively controlling the ratio of risk to profit.
Seventh, be familiar with the linkage effect; while watching the market for a specific coin, also pay attention to the movements of other coins. Each coin in the market is not isolated; it seems unrelated but is actually intertwined. You need to understand the linkage effect regarding coins; many tools now can be used to check coin information and news.
Eighth, position allocation must be reasonable; the allocation of hot coins and valuable coins must be reasonable, paying attention to the ratio of pressure resistance and profit intake. Being too conservative will miss opportunities, while being too aggressive may face high risks! The biggest feature of valuable coins is stability, while the biggest feature of hot coins is volatility, which may skyrocket or plummet.
Ninth, having coins in the market, money in the account, and cash in the pocket is the safest and most reassuring configuration. You cannot go all in; doing so will lead to death. The ability to control risk and the reasonable allocation of funds are key to your mindset and success or failure. Idle money for investment is fundamental.
Tenth, master the basic operations, learn to apply knowledge to new situations, grasp the basic thoughts of trading, observation is the premise, remember each high and low point as reference data, learn to take notes, develop a reading habit, and cultivate the ability to filter and sift through information.
Stable investment plan
Position control; never easily go all in. Why not go all in?
The first point is risk control; you cannot guarantee that your purchase will immediately rise. If you encounter a waterfall drop, your assets will greatly depreciate, and you will not be able to buy more to lower your average price.
The second point is mindset control. I have experienced this myself: after going all in, I would constantly watch the market, severely affecting my mindset. I could not even sleep well.
The third point is the tendency to get "harvested" and having a gambling mentality, always wanting to see changes in their profits. After going all in, if they do not see a price increase in a short time, or if other coins rise or there are other coins they want to buy, they may cut losses and buy repeatedly, leading to dwindling funds.
Long positions account for 30-40%, held for a long time.
Short positions account for 30-40%. Why are there short positions? Many people say that short-term trading will definitely lead to losses. However, when we allocate funds for long-term investments, trading cryptocurrency can be quite interesting. I believe that the vast majority of people cannot control their hands; as long as they control their positions well and avoid frequently cutting losses, they can usually achieve profits in short positions (unless there are special circumstances regarding the project or the market). Then refer to my position control above; not every long position in a coin yields higher returns than short positions.
Second, how do newcomers enter the cryptocurrency circle?
1. Bitcoin and Ethereum are hard currencies in the blockchain world. If inexperienced traders do not understand what digital assets to buy, it is recommended to buy BTC and ETH.
2. Digital currencies come in various categories, including: currency type (BTC), platform type (ETH), application type (SC), pegged type (USDT), dividend type (repurchase BNB). Digital currencies have multiple attributes. New traders in the cryptocurrency circle only need to distinguish between valuable coins and junk coins; valuable coins can be held long-term, while junk coins should not be touched even if they multiply by ten thousand times!
3. The channels for purchasing fiat currency are: over-the-counter trading platforms and private OTC. Over-the-counter trading platforms generally support multiple assets like BTC/ETH/EOS, while private OTCs depend on scale, mostly supporting only BTC and ETH hard currencies. Try to avoid private transactions without guarantees; if scammed, it is very difficult to recover funds.
4. Regular trading platforms: Bitfinex, Bittrex, Binance, OKEx, Huobi, etc. Bitfinex has the most diverse gameplay, Bittrex has the largest trading volume, and Binance offers the best experience. The combination of the three can basically meet all the needs of ordinary users.
5. Commonly used wallets: Ethereum recommends Imtoken, Bitcoin recommends Bitpie. Make sure to save your private keys and mnemonic phrases! If forgotten, your assets will be wiped out.
6. Do not keep important digital assets other than junk coins on websites; always store them in a secure wallet. Most websites do not guarantee a hundred percent safety, and incidents of theft or insider theft occur frequently!
3. Review the basic gameplay that newcomers need to understand in the cryptocurrency circle.
The concept of blockchain seems to have spread globally overnight, and the cryptocurrency circle that emerged alongside it has become a fertile ground for creating countless wealth myths. In a short time, whether big investors or small traders, almost everyone has cast their eyes on this circle, pouring in large amounts of capital, fearing that if they lag behind, they will miss the opportunity. In fact, as a new industry, many investors have entered the field recklessly without knowing almost anything about blockchain, and inevitably, they cannot escape the fate of being "harvested." Since we all enter the cryptocurrency circle to make money, have you really thought seriously about how to make money in this field? Or how to earn money more stably in the cryptocurrency circle?
Method One: Project crowdfunding. In the cryptocurrency circle, project crowdfunding is undoubtedly the most exciting way for investors to participate. Through this method, many investors have seen their assets multiply dozens or even hundreds of times in a short period, with limitless potential. However, times have changed; the number of crowdfunding projects has surged dramatically, and their quality varies significantly. Currently, the risk of breaking below for crowdfunding projects is extremely high; if an investment fails, it is very likely to result in a total loss.
Method Two: Short-term trading in cryptocurrency, also known as wave trading. In the cryptocurrency circle, short-term trading is the most common way of play and is usually the first posture most people adopt when entering the cryptocurrency circle. However, short-term investment in the blockchain world is undoubtedly a gamble, with great risks. If you think that following the K-line analysis of certain 'short-term masters' will allow you to succeed in the cryptocurrency circle, then congratulations, you are not far from being a qualified inexperienced trader. If you do not lose everything within three years, consider it my loss.
Method Three: Arbitrage, which refers to taking advantage of the price differences of various currencies across different platforms. Buy from the platform with a lower price and sell on the one with a higher price. The difference in price is naturally the profit from arbitrage. At this point, do you think arbitrage is a risk-free way to make money? Too young, too simple! Arbitrage is actually a technical job; due to the different withdrawal speeds of various exchanges, the prices in the two markets are likely to reverse during the withdrawal period, and since withdrawals across exchanges incur fees, in fact, only the trading platforms guarantee profit.
Method Four: Participate in airdrops, also known as "shearing sheep." To let potential investors receive information related to tokens, some project teams often conduct airdrops, transferring coins to user wallet addresses. Since airdrops are generally received for free, this method is also quite popular among users. Airdrops seem to be a zero-cost way to make money, but in reality, some scam groups often use high airdrop rewards to lure people, then induce users to input their private keys, ultimately transferring all tokens from the user's wallet address. Hence, airdrops are not guaranteed to be risk-free. Method Five: Invest in Kssbtc platform for stable financial management.
The most reliable way is to join a blockchain company and invest in projects alongside the team! KssBit is an all-in-one digital currency fund redemption platform that integrates quantitative trading, strategies, AI arbitrage, DeFi, ETFs, and other comprehensive profit-generating fund platforms. The platform supports BTC, USDT, and ETH-based financial management, offering continuous returns across bull and bear markets. Various funds are available to meet different user needs for stability and aggression. All funds are available for deposit and withdrawal at any time, with real-time settlement. No locking up, no irregularities, flexibility and convenience. This is currently the most stable and realistic way to ensure "guaranteed profits"!
I have written an article on the mindset for trading coins, hoping it can serve as a beacon for you on your trading journey in 2024, so you will never lose your way!
First, summarize a few reasons for losing money; only by knowing why you lost money can you find ways to earn money.
1. Not stopping losses, turning short positions into medium positions, and medium positions into long positions.
As a long-time investment practitioner, we are often asked, "What is the most common mistake investors make in the investment market?" My answer is the lack of immediate stop-loss. Due to its leverage effect, both profits and losses are magnified in long and short dual-direction investments. The consequences of not stopping losses in time are often extremely serious. The same goes for the cryptocurrency market; we all know that our most valuable asset in the cryptocurrency market is our investment capital. Capital is like ammunition on the battlefield; without ammunition, failure is inevitable. We must constantly pay attention to protecting our capital and not allow losses to expand infinitely. Many people hope, pray, and dream of finding a perfect trading method that can guarantee profits without stop-loss. In short, such a perfect money-making method is impossible in any field. A successful trading method, like a successful life, is not achieved by avoiding losses but by controlling the quality of those losses.
Changing the time frame is also a common mistake made by inexperienced traders in the cryptocurrency market. The so-called change of time frame is also a disguised form of not stopping losses and not admitting mistakes. It happens like this: a trader buys a contract in the hope of achieving good short-term returns, but the market trend does not produce the desired effect. This investor does not sell within the short-term time frame but decides to hold the contract and switch to medium or long-term investment. This is just an excuse to avoid stopping losses; this method of changing time frames will inevitably lead to disaster, and stopping losses is the only way to avoid disaster.
2. Not paying attention to fund management and not controlling positions.
We use our hard-earned money to participate in cryptocurrency trading, which is essentially no different from investing in a convenience store near your home. If the small owner of the convenience store comes to you asking for money to invest in his small store, how would you consider whether to invest? How much would you invest? Would you decide impulsively like in cryptocurrency trading? The so-called fund management is precisely to solve the problem of whether to invest and how much to invest.
The suggestion for beginners is to divide funds into six parts, only invest one part each time. As your experience increases and your investment accuracy improves, gradually increase your positions, but at no time should the holding of any one coin exceed fifty percent of your total funds. Otherwise, once a mistake occurs, it will be very difficult to recover. For example, if you have 100,000 yuan and lose fifty percent in one go, you will be left with 50,000 yuan. To earn back to 100,000 yuan from 50,000 yuan, you need to make a hundred percent profit. Anyone with a basic understanding of math knows that achieving a hundred percent profit takes much longer than recovering from fifty percent loss.
A survey was once conducted in the U.S. asset management industry: the most important factor for a fund to win in the long term is not when or at what price to enter the market, but how much the fund bought. This is the term often mentioned in the investment community: fund management. In cryptocurrency trading, if you do not pay attention to fund management methods, you will definitely not reap the final victory.
Personal experience summary.
1. Reasonably plan your funds for trading coins, ensuring that you have food in hand and are calm at heart!
2. Avoid making emotional trades; do not let profit cloud your judgment and place orders blindly.
3. Develop a good trading plan and follow the market.
Use large positions for trends and small positions for waves; control your ratios well. For counter-trend trades, use light positions and stop losses; for trend-following trades, increase your positions and hold firmly. There are no unprofitable trades in cryptocurrency; only unprofitable operations exist. Trading is a test of the correct mindset! I wish all my cryptocurrency friends can find their trading methods and make steady profits.$BTC $ETH $SOL #市场围绕90K #Solana涨势分析 #PNUT再次走高
