To remind myself and for every beginners.

One of the biggest mistakes many cryptocurrency traders make is failing to manage risk properly. Here’s how this mistake typically unfolds:

1. Over-leveraging: Traders may borrow too much money (use excessive leverage) to amplify their trades. While this can lead to large profits if the trade goes well, it also increases the potential for significant losses if the market moves in the opposite direction. Many end up liquidated, losing their entire position.

2. Lack of Stop-Loss Orders: Newer traders sometimes skip setting stop-loss orders, hoping the price will eventually bounce back if it moves against them. Without these orders, a small dip can turn into a large loss, especially in fast-moving markets.

3. Emotional Trading: The "fear of missing out" (FOMO) and panic selling are common emotional pitfalls. Traders buy when prices are already high, fearing they'll miss a rally, or they sell when prices drop, often at a loss, to avoid further losses. Both approaches lead to buying high and selling low.

4. Ignoring Diversification: Some traders put most or all of their funds into one cryptocurrency, especially small, high-risk tokens, in hopes of fast gains. When that coin drops, their entire portfolio suffers, increasing their overall risk.

5. Chasing Trends and Hype: Many get drawn into coins that are hyped up, often with little research on the project itself. These can be highly speculative "pump and dump" schemes, where the price spikes due to hype and drops just as quickly, leaving buyers at the top with steep losses.

In summary, managing risk, avoiding emotional trades, and conducting thorough research are key to navigating cryptocurrency markets. Proper strategies can protect traders from the pitfalls of high volatility and help make informed decisions.