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Cryptocurrency basics

Cryptocurrency basics

Welcome to the exciting and sometimes too geeky world of cryptocurrencies.

Our mission is to make crypto easy to understand. And we hope we delivered on that promise.

Are you ready to learn cryptocurrency basics? Let’s jump straight in.

Before we do so – we are not some Wall street suits. We’re normal guys like you, trying to make a decent living.

We trade cryptocurrencies since 2018. We learned everything by ourselves. And now is time to educate you!

Don’t bet on one horse only

The worst thing you can do when investing into cryptocurrencies is to bet all your money on one horse. You could be lucky, but you will most likely wail. It’s simple mathematics. Instead, find at least 10 interesting cryptos and invest into all of them. That way, if one cryptocurrency looses 100% of its value, you will actually have only 10% loss. And what are the odds that all 10 cryptos you choose will loose 100% of its value? Very low.

Don’t check prices every day

We are struggling with this point as well. It’s true, that once you got money in some cryptos, you feel the need to check prices every day. Actually multiple times a day. Don’t do it. Crypto market is highly volatile. One day you can be 10% down and month later 50% up. Sit tight, eat your popcorn, watch Netflix or HBO and forget about crypto for a while. You hold it for future gains.

Timing market? Impossible.

Every time you hear someone saying market is gonna do this or that, don’t believe them. They are charlatans. Even we might say things from time to time like that market is gonna recover at some specific price target, but it does not mean it will happen. Eventually every drop will find the bottom and new wave of investors will jump in causing the price go back up, but when this happens….. nobody knows. Nobody can time the market. Impossible task. Even for rocket scientist.

Don’t invest money you can’t effort to loose

Rule no. 1 of any investing. Invest only 10% of your fund reserve. If you don’t have fund reserve, create it by saving money and then (only then) invest, but just those 10%. Nobody knows what’s gonna happen next week. Hell, even tomorrow. If you can’t afford to lose the money, don’t invest. Ever.

Don’t invest into projects that have total supply in billions

Why Bitcoin goes up? Yes, demand. But also because there will be finite number of mined coins – 21 millions precisely. When you look at some cryptocurrency and you see it has billions, or even trillions or even more (yes, some projects have even higher numbers, but they burn part of it regularly), stay away from it. With one exception – if it’s new project, if it exists only a while, market cap is in millions, you could buy it. But watch it carefully and sell when the price gets to 0,1 – 0,5 USD. We don’t know the exact price target, it’s just an educated guess.

Is mainnet (=product) launched? In beta? Or just on white paper?

We read dozens of white papers. Some were so well-written, we fell in trap and bought that crypto. But they had no product yet, bad things happened and price tanked. And we learned the lesson. Don’t invest into whitepapers. Wait for beta. Or mainnet. When the product is out there already, it’s a good time to invest.

Always DYOR and focus on following things

DYOR = Do Your Own Research. Check out roadmap (interesting things gonna happen?) team (do they have experience and education?), activity on github (are they active?), social media followers (how many?), telegram chat (usually you can spot bad things when you check out what other people write about the project) etc.

Secure your exchange account with 2FA verification

When you create your account on exchange, always turn on the 2FA verification. That means you will always need your smartphone to approve withdrawals and other important things you can do with your account.

Watch out for high gas fees

Not sure if you know, but everything based on Ethereum is subject to (currently) pretty high gas fees (transaction fees). So when you withdraw, you pay gas. When you want to cash out and you have to send crypto from wallet back to exchange, you pay again gas fees and it will eat part of your profits. Lesson? Either wait for lower gas fees (sometimes you might get lucky) or keep crypto on exchange (which is not recommended by pros by the way).

If gas fees are low, send your crypto into wallet

If gas fees are currently low, make sure you set up Metamask (chrome extension wallet supporting many networks including Ethereum and Binance Smart Chain) and send crypto into it for housekeeping.

What to do now when I know?

Now when you know cryptocurrency basics, next thing is to buy crypto. Read our tutorial here.

Millions of ordinary folks managed to get rich in one generation.

Are they smarter than you? No.

Were they luckier than you? No.

The only reason why they have more money than you is that they followed the plan. They invested money.

And you can do that too.

What’s stopping you now from taking some money and investing into some of the cryptocurrencies we mentioned?

Don’t wait and invest now
If you decide to invest, do it now, because there are countless opportunities every day. You don’t want to miss that. And if you really invest, trust me, that the only problem you’re gonna have, is that you haven’t invested more. Sounds fair? Find out more about cryptocurrencies that are worthy of your attention.

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