Seven tips for the Crypto rookie
New to Crypto? Here are 7 tips on getting started.
Welcome to Crypto!
Entering the crypto space for the first time can be overwhelming. I remember when a mate of mine was telling me about it; the conversation bounced between my own skepticism and my mate’s persistent excitement about the sheer potential of it all.
Coming from some experience of traditional investing (stocks, real estate, etc), I did see some similarities; but ultimately, the speed at which the crypto markets would change blew my mind. Crypto has been around for 12-years (since 3rd January 2009), but it is still in its early phase.
I have only been doing crypto for about a month, but the following seven tips are relevant to any new starter…
- Get onto CoinMarketCap (either online or the app).
This will provide an overview of the crypto market: from vital stats to a list of cryptocurrencies by market capitalization to education and other tools. For those migrating from the stock market, this is your new S&P 500 index. CoinMarketCap is a solid reference to the crypto market.
2. Get onto a number of exchanges and wallets.
I encourage anyone about to invest or trade crypto to get onto a number of exchanges and get a number of wallets. Each different exchange and wallet has its own functionality, advantages and disadvantages. Use them all to your advantage.
3. Know what’s behind each coin/token.
Just like with the stock market, each ticker symbol (ie. TSLA; MMJ) on the NYSE or ASX represents an underlying company with its associated efforts and potential. The same goes for the crypto market. Each ticker of coins or tokens (ie. BTC; CEL) represents an underlying project in the crypto space. If you take a top-down approach, it is still prudent to know what you are trading or investing in. If you are able to support a cryptocurrency’s network through staking, find out the best way to do this. For example, Cardano’s ADA is best staked through either Daedalus or Yoroi.
4. Know your fees!
Different exchanges have different fees for buying/selling/swapping, etc. Know what they are for each exchange. One exchange might be better than another for certain coins and tokens. Be especially aware of withdrawal fees. When I moved my 0.00331 BTC over to Celsius (from Independent Reserve) the withdrawal fee was 0.0003 BTC! That’s was around $9 AUD at the time. My 0.00331 BTC became 0.00301 BTC. At the time that was close to 10% of my BTC holding! Ouch! It is better to withdraw and transfer coins/tokens in bulk. A 0.0003 BTC withdrawal fees hurts a small transaction more than it hurts a large withdrawal. Here is a website to know your withdrawal fees: https://withdrawalfees.com/
5. Learn how to trade — at least some of the basics.
If you are holding tight for the long term, or are the bottom-up/fundamentals type, you should still learn some basics of trading. This can help you buy better (and sell better). Know about candlesticks, know your resistance vs. support, know how to apply moving averages. There are some great YouTube channels dedicated to this content such as Alessio Rastani, InvestAnswers, Trading 212, etc.
6. Beware of scams!
In the earlier days scams were rampant in the crypto space. Nowadays the bona fide exchanges and wallets are quite well known. However, there are still constant scams all over the internet. Be wary of unsolicited messages and pages on social media. As an active group member on certain social media sites, I get unsolicited messages promoting certain websites. If it’s too good to be true, it’s too good to be true. There is no need to take undue risks. Stick to the known. Before getting involved with something do some basic research. A quick Google search can reveal enough to stop you making a mistake.
7. Join the Celsius Network!
If you intend to hold onto your crypto for future capital gains, make sure you earn on it in the meantime. Every coin/token you hold can earn you something! The Celsius Network has decent yields on popular cryptocurrencies. They pay out weekly and allow you to compound your holding. You can read my introductory post about Celsius here.
There are many resources out there to learn about Crypto: education on exchanges (ie. Binance Academy), YouTube channels, groups on social media, Crypto blogs, etc. Crypto is decentralised, as is the education surrounding it.
Seek and you shall find.