Bitcoin Forum

Cryptocurrencies are gaining a lot of popularity by the day and a lot of people are staring to get involved with the crypto space.

The Decentralized ecosystem is a very wide one with a lot of applications, proof of concepts and theoretical use cases for cryptocurrencies. While a lot of these potential use cases of cryptocurrencies may seem futuristic, there is one that is already a reality.

This is the use of cryptocurrencies as a means of monetary value exchange and store of value. This part of cryptocurrencies is what a lot of newbies are familiar with. So before you purchase your cryptocurrencies or download that exchange app that keeps popping up in your ads, here are a few things that i think you should know when investing in the cryptocurrency space.

I in my journey as a newbie have at one point or the other failed to realize some of these and paid dearly for it...

1. Cryptocurrency is Not a Get-Rich-Scheme

Most newbies get interested in the crypto market during a bullish market where everyone seems to be buying cryptocurrencies and making a lot of money, they tend to mistake cryptocurrencies for schemes that will miraculously make you rich out of nowhere.

This is a wrong approach to cryptocurrencies or any type of investments, because investments in their nature carries a significant amount of risk and you are just as likely to make money as you are to loose money, so choose your investments wisely



2. Store Your Coins Or Tokens in Private Wallets Not Exchanges

Most newbies make the mistakes of keeping their cryptocurrencies in exchange wallets and this is the wrong way to save your cryptos. There have been a lot of cases where cryptocurrency exchanges have been hacked and cryptocurrencies belonging to users have been stolen by the hackers.

I am not saying that this is going to happen to you or the exchange that you are using, but since it has happened repeatedly before, it can definitely happen again, so be sure to withdraw your cryptocurrencies to your personal wallets.



3. Price Direction Is Not Constant

The price direction of cryptocurrencies is never constant and in as much as there are bullish market conditions where the prices of most coins and tokens increases rapidly, there are also bearish market conditions when the prices of everything just dumps.

It is important for you to know this so that you can make more informed decisions when investing your money and also when deciding which money you want to invest into cryptocurrencies.

Back in early 2018, I once made a mistake of investing my rent into some altcoins, as it turned out i had bought these coins at the very top of the price pump.  A price correction started not long after i invested in this altcoins and when the time to pay my rent was due and I sold off my holdings, i had lost close to half the USD value of what i invested at the time.

if i had been more realistic in my approach to investing with the knowledge that price can go up and also come back down, then i wouldnt have invested my rent and i would be able to hold my coins even in periods of drawdowns.



I hope this helps you on your journey in the cryptocurrency space

This is only true for bitcoin and possibly some of the popular altcoins that have open source and reviewed desktop (and other type of) wallets but not for majority of tokens and shitcoins.
I'd argue that storing the later in exchanges is a lot safer than installing a shady closed source wallet that nobody has reviewed and can contain malware. You can end up trying to save the shittoken but lose your bitcoin after installing the shittoken's wallet.

There is also the problem with the pump and dump nature of the altcoins which demands storage on exchanges for quick access so that you can dump them fast or risk losing all the profit that was gained in the pumping stage.

This is indeed a good precaution mate especially number 2. Many have witnessed how many exchanges got hacked and luckily some of those hacked are being returned but not all cases are like that. We don't know some get hacked and they can't sustained the loss of that breached and when your token or coin is there then sad to say that it's a loss. Good thing big exchanges started to improve their security but nevertheless the coin must be stored on a non custodial wallet for everybody's safety of course.

You made a very good point here but you have to agree that majority of the existing coins and tokens are compatible with safe and secure wallets, it can be a mobile wallet, paper wallet or hardware wallet

In the case of desktop wallets i will also be wary of new projects that appear out of nowhere and only require you to install their desktop wallet

About the pump and dump nature of altcoins, i think this depends on your investment strategy, i personally prefer long term investments so i keep my coins and tokens in my wallet to be safe

Crypto newbies should know How Many Bitcoin Forks Are There? You will be surprised!!! (https://bitcointalk.org/index.php?topic=5221882.msg53737261#msg53737261). After they know that the market has many bitcoin forks and all forks are shit coins, they will know altcoins (not bitcoin forks) are shit coins too.

They must look at the price historic charts of those shit forks and get their conclusions on how shit forks were hyped at starts and how they are valued by the market now.

They will be able to judge the current hypes of DeFi tokens, NFT tokens.

Honestly ive made more money from altcoins than bitcoin in this bear market, making that money is what matters not where the money is coming from, a shitcoin like you said can make me rich than bitcoin, also in trading I find alts to be more profitable than bitcoin

I think this a good thread for all newbie because what most people dont still understand is that they think crypto is a get rich scheme and when they lose their money for whatever reason they conclude that they have been scammed and also keeping your currencies on exchanges is never safe because it can be hacked anytime and a whole lot of exchanges have been breached in the past

You are right, we are all into crypto space to grab opportunities and BTC can't do that alone that's why we have shitcoins and few good altcoins, all thanks to altcoins because that's where most of my gains comes from

The reason why most newbies store their coins on exchange wallet is that most of them do not have a clue what private wallets are. It would be great if you can quote a few examples of private wallet rather, non-custodial wallets.

Newbies now are joining the crypto wave because they hear their friends and family earning good returns from their investment. Half of them have no clue about a decentralized economy and how to protect assets from hackers and scammer. They want to join this revolution because they think it is a quick way to become rich. They are the ones who will lose their money and then call cryptocurrency a Ponzi scheme.

It is great to see such topics are being created in this board to educate new members.

Take note that just because you made money by trading a certain coin doesn't necessarily mean it's not crap or a scam. People have made money through past scams such as BitConnect as well. Remember that all a coin needs to pump in price is just enough suckers to buy into the low liquidity pairs.

This  is why i take every new altcoins as short term opportunity, when they appreciate in value it's probably going to be for the short period of time, it's better to always take profits once your tokens or coins are up in value, the only coins worth holding through any weather is BTC

Thanks very much for this,I intend to buy when the price is low and save until it gets up before I resell and wait for it to get low again then I continue the cycle

#1 is right.

I've just talked to see some of my friends and they've known that I'm into crypto and followed the news and market and the first thing that they've said, I've profited much in the market.

But not that really, I wanted some more and looking forward to the future how much bitcoin shall be by that time. When they see the market goes in the bull run, they're very active and always have a thought of that it's just an overnight success and crypto is all about getting rich quickly.

Keeping of alt-coins has to be in respect to the type of alt-coins you incubating, as an investor you would want return of investment -ROI- from you alt-coins, and most especially for Long term investors, it hurts so bad after investing, and waiting till almost infinity with no return of investment.

So in that regards to -Newbies- I think they should understand that investment in alt-coins will demand/require them to work, so to trim there negative chances of a wrong alt-coin.

You'd be surprised how many of the altcoins have shady or at least buggy terrible wallets, even the popular ones. For example a couple of years ago someone figured that the official ethereum wallet's multi signature wallet allowed them to steal people's coins very easily.
Not to mention the numerous closed source wallets, mostly for mobiles, that have gained popularity and people think they are "safe" just because they don't understand what safety means.

It does depend on your investment strategy, you shouldn't "invest" in a pump and dump. For example all the altcoins have been losing value against bitcoin for the past 4 years without exceptions. That means they are not viable long term investment options.

Very good advice cryptobrzy.
I would also add that patience is very important in crypto, but you should also carefully analyze the information and not rush into decisions.
Also, every wrong decision can be corrected and every loss can be recovered.
Members who have been in crypto since 2017 understand this very well.
Just look at what happened to bitcoin after 2017  :D

You are very right about this, patience is key i remember a couple of my friends invested in Sparkster in 2018 and were trying to convince me to do the same, i did not really understand the project so i just decided that i was going to buy it on exchange.
In the end the project turn out to be a very poor one and they practically lost the money they invested.

About losses, one thing i have learned so far is that you can never be too careful and sometimes your investments can turn out badly but that shouldnt discourage you from investing when other good opportunities arise.

Local wallets are good, but in the case of bitcoin, it'll cost you $5 for every transaction, so you'd better not need to actually get to your funds.

I have some coinage locally, but the majority is still in US exchanges.

Lol it's like you are indirectly sending out a warning message to all crypto investors to abstain from been greedy, market will eventually correct itself one day or the other, everyone should make sure that they make back what they invest before taking more Futher risks, good one mate