Avoid These 5 Big Crypto Mistakes made by beginners when learning to buy and trade cryptocurrency. Newcomers all seem to keep making the same mistakes when they first get involved. Some mistakes can be costly and can be easily avoided. We bring you the 5 biggest and most common mistakes that you can avoid by being aware of them. You want to ensure that you get the most out of your participation with Cryptocurrencies.
1. Not Knowing Exactly What You are Doing
I made my first crypto trade when I bought about $10 of Dogecoin just for the fun of it. It was a small investment for 10,000 coins and I was proud of myself for taking that step into the world of crypto. I wanted to give it away to some friends and family, to give them a taste of crypto and see if at least one person might join me in a crypto interest. The problem is, I didn’t realize the importance of keeping the private key to the wallet the coins were stored in. I lost the key– that’s like losing your physical wallet or leaving your cell phone and having it stolen.
You need to know and understand how to keep your crypto and keep it securely before you try to buy or trade. Learn the basics and keep learning vas much as you can about crypto to really get a handle on what’s happening in this space. To get the most out of your efforts the best investment is knowledge. Understand how the crypto markets work and study price change patterns. There are many crypto communities that you can join. Join our community — Be A Cryptoan!
2. Using your Exchange Wallet to Store all of your Cryptos
Bitcoins and Ethers are exploding in value. They are now worth a lot of money and investors are taking notice. They are attracting new investors, including institutional investors. Dramatic price increases also makes them attractive to hackers and thieves as well. Most people purchase from a cryptocurrency exchange. The exchange provides them with a type of online wallet to store their Bitcoins.
Exchange wallets are the least secure storage option. Keeping all of your cryptocoins in your exchange wallet is not a best practice. The security issues of exchange wallets have improved, but they are a much easier prospect for hackers compared to hard wallets. It is almost impossible to hack the blockchain for cryptos held in storage. If a hacker gets into your online exchange wallet then they can take all of your Crypto coins.
The second reason you should never keep all of your Bitcoins in an exchange wallet is because they can suspend or even close down your account for a variety of reasons. If they close your account down altogether then you lose any Bitcoins in your exchange wallet.
There are different types of wallets you can use to store your Bitcoins and any other cryptocurrency. The online or mobile wallet offers the highest level of convenience but the lowest level of security. You might use these wallets for small and regular buying and trading transactions.
3. Security, Security, Security
You can get a more secure wallet which is a downloadable application for your desktop or laptop computer. Some of these are free and some require payment. These are medium security Bitcoin wallets because you can disconnect your computer from the Internet.
Paper wallets are more secure than downloaded wallets. As the name suggests you print your vital cryptocurrency information to paper and then you can store the physical piece of paper where nobody else will have access to it (such as in a safe or a bank safety deposit box).
The most secure wallet available is a hardware wallet. This is usually a USB drive where you store your private keys with password protection and the benefit of only plugging it in to use when you are making transactions. ALWAYS take the wallet out of the computer when finished. Hardware wallets are fairly inexpensive and they are very much worth the price.
4. Price Change Panics
Cryptocurrency markets are notoriously volatile. Price swings of $100 a day up or down are common. Newcomers to cryptocurrency investing sometimes panic when they see these wild price changes – particularly price drops– and they rush to sell, only to miss out on significant gains if they had stayed the course with that asset.
Crypto investing is better suited for long-term and medium-term positions. There is never a need to panic sell. Bitcoin goes up and down in price in cycles and other cryptocoins tend to follow the trend. It steadily rises in value over the years and there is no reason to think this will not continue.
We consider seven factors when buying or selling any cryptocurrency. We will share this information and much more when you become a CRYPTOAN.
5. SWITCHING from one Cryptocurrency to Another and Diversification
If you are going to invest in a particular crypto then stick with that crypto for awhile. It’s alright to sell or trade part of a position when the price is up, but jumping around from one cryptocurrency to another rarely works well. Don’t be tempted to buy into only one altcoin and neglect the potential of many other coins not as well established as Bitcoin or Ethereum.
Ethereum and Bitcoin will continue to rise in value, but it will be smaller and not well know altcoins that makes huge gains and represent the better investments. Do you want to know what I think? BE A CRYPTOAN!
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