Investing and trading cryptocurrency is one of the most popular trends in the modern era. A lot
of people were initially skeptical about its potential during its early stages until early investors
emerged as millionaires from their Bitcoin venture. Today, many people want to have the same
fortune so they try to enter the crypto market.
Unfortunately, crypto trading is more complicated now than it was when Bitcoin was the only
popular digital asset. Novice investors are prone to making many kinds of mistakes. Don’t worry
because they are easy to avoid if you are aware of them. Here are the common crypto investor
mistakes and how to avoid them:
Not Having a Stable Strategy
Investment is not an action. It’s a long-term plan that needs to have a beginning, middle, and
end. The first that it needs is a clear, tangible, and achievable goal. Ask yourself why you are
investing in cryptocurrency. Of course, most investors are in the industry to earn money and that
is one of the valid reasons. Others are there to use the blockchain for something else, too.
Whatever the goal is, it helps you choose a route. One of the most basic strategies is holding
onto your assets to benefit from its long-term rewards. Quick traders have to have means of
gaining crypto for selling. Some buy and sell based on a crypto’s current market value. Others
mine or engage in live dealer games to generate crypto.
Whichever strategy you choose, don’t try to deviate from it. Of course, there should be some
plans for reforming based on the current state of the economy. However, deviating too far from
your initial plan will end up breaking your momentum and consistency. If you ever find the need
to change a big chunk of your plans, consider drafting a new strategy from start to finish.
Not Knowing How to Choose a Good Exchange
Knowing the platform where trading is done is just as important as understanding how the
crypto economy works. Most digital transactions are still reliant on the internet which is prone to
many scams and fraud. Some platforms are either shady or prone to being hacked.
You should also remember that paid banner ads are easy to make and cheap to the
commission. Having a paid ad is not a testament to how serious or financially secure the
exchange is. Your best option is to either do your own research or seek forums talking about
exchanges. Reddit is the most popular common ground for skeptical and critical investors whom
you can learn from.
Taking Unnecessary Risks
Crypto investment is not a reliable source of income. Crypto evangelists remind investors to
always prepare for the worst when investing. Imagine what your financial situation will be like if
your investments’ profitability drops to zero. If you can still pay for bills and other expenses
when that time comes, then you are in a safe position as an investor.
Don’t stake money that you cannot afford to lose. Always have a reliable source of income
during your first few years as an investor. Mining is not reliable nor sustainable in recent years.
It’s better to be a stakeholder in proof of stake (PoS) for people who can’t afford to pay for the
energy their mining rig would consume for proof of work (PoW) algorithms.
Gambling is also one of the options that can be risky with large bets. Playing low-stakes live
dealer games should have a more consistent win rate. Just remember to never take debt for the
sake of investing. Stay within your comfort zone. These are all the mistakes that you need to be
Disclaimer: This is a paid post and should not be treated as news/advice