How can beginners avoid pitfalls when entering the cryptocurrency world?
1. Avoid investing in small altcoins
Most small altcoins in the crypto world are designed to exploit inexperienced investors, often dropping to zero or losing over 99%. If you haven't heard of it and it has a low market cap, don't invest; stick to mainstream cryptocurrencies.
2. Don't set your expectations too high
The era of tenfold or hundredfold returns is over. With major institutions and elite investors entering the market, the big profits are gone. Achieving a double return is already quite good; for beginners, breaking even means you've outperformed over 90% of participants.
3. Avoid ultra-short-term trading
Cryptocurrency prices can be very volatile; it is common for Bitcoin to drop by 20% in a single day, and altcoins can be halved in value. It's tough to navigate short-term trading, so hold onto the coins you already own.
4. Set stop-loss and take-profit orders
Define your targets: if the price drops to a certain level, exit decisively. If it rises to a certain level, sell without worrying about how much higher it may go afterward. Many people lose money in bull markets simply because they fail to take profits in time.
5. Don't bring all your funds into the crypto market
The risks in the crypto world are too high; both entering and exiting carry risks. It's advisable to start with a small amount of your spare money to practice in the crypto market.
6. Continuously learn and acquire knowledge
You can't earn money beyond your understanding. Even if you make a lot initially, a lack of understanding will lead to quick losses, potentially incurring significant responsibilities. Continuously learning and improving your understanding is essential.
7. Find an experienced and reliable mentor
There are many traps in the crypto world; over 99% of participants lose money. Find a knowledgeable and reliable mentor from whom you can learn. While they may not guarantee profits, they can help you avoid many pitfalls.
8. Look for low-priced assets to invest in, with stable fluctuations; high volatility poses too much risk.