Anyone can participate in the cryptocurrency market. People can invest in an Initial Coin Offering, trade, or just research about the whole system work, and they can get a hold of the information they need by simply looking into it in the Internet
However, while getting involved in cryptocurrency is easy, it is still a very volatile market. If you are planning to invest or trade, it is important that you on top of your game at all times. This is especially true as you will have to make daily trading decisions. You also need to do look into different legal scenario, market research, and strategize on how you can win in trades.
In case your crypto desires are high, there’s no reason for you not to start learning how it works. Even if its just as simple as researching how a coin machine works or how you can start with ICO investment, there are plenty of resources and like minded people that can help you. To help you dodge possible pitfalls along the way, here is a list of common rookie mistakes you should bear in mind:
Not creating a trading strategy
If you’re goal is to gain solid profits in cryptocurrency trades, then you want to invest in a well oiled machine. A stock that has been in the industry for some time, has good reputation, and is performing well are just some of the considerations that will come in handy. It’s also advisable to have both long-term and short-term strategies so you know the amount of investment profit you want to get, the correct price you are willing to buy or sell, and even how much money you are willing to lose. Concrete timeframe and planning allow you to have a firm position on how your trading strategies would pan out.
Not doing enough research
While your friends may have been finding it easy to work their way through cryptocurrency trading, your experience might not be the same. It’s not enough to just know what strategies, or trading platforms an ICO branding is using. As a newbie, you want to do your research to thoroughly understand how cryptocurrency works. Don’t rush into joining a trade or investing in an ICO if you are not confident of the steps you’ll take. This will also help you avoid common cyrptocurrency scams and pitfalls. If you have friends who are already investing in cryptocurrency, it will be best to ask them for some tips and tricks on how to navigate your way through.
Not securing your investment
It’s no secret that cryptocurrency is a risky investment option. And with cryptocurrencies making headlines and getting the interest of many people, security has become more and more important. Store your crypto investment in a software or hardware wallet, and use all necessary security precautions to avoid malware or hacking. Your wallet’s private keys should never be published, sent to other individuals, or shared in any other way for your investment not to be compromised.
Relying too much on peers
Some rookies jump into the crypto bandwagon thinking that their peers who have been in the business for years can save them should they drown. What they fail to realize is when trading, it’s important that strategies and ideas are exchanged. As a trader, you need to be updated on the movements in the market as it will empower you as you make crucial decisions. It will be dangerous and not a good practice to just get ideas from peers or depend on them too much in times of investment decisions. Plus, knowing the market and trade will make you feel confident about how your decision will fit into your long-term investment plans.
Choosing the wrong exchange
Aside knowing the basics of cryptocurrency, you also want to learn about other factors such as the country, policies, security, trading volume, and the reputation before you invest on an exchange. Each exchange is slightly different due to different factors, and knowing what the best bitcoin exchange is, is quite tough to determine. Note that the best exchange for a peer, might not be the best exchange for you.