Some Common Mistakes Made by New Crypto Investors

[Nheer]

Investing in cryptocurrency can be thrilling, but many inexperienced investors make basic errors because they are so excited about the profit people make from trading cryptocurrencies that they believe they can ignore the small precautions and guidelines, resulting in the loss of some or all of their assets. So this post aims to increase knowledge among crypto novices so as to prepare and prevent them from repeating the same errors that have been made previously. The mistakes are as follows:

-Lack of Basic Crypto Knowledge: Some people are drawn to cryptocurrency because of the excitement and profits associated with it. As a result, people become obsessed with making money and fail to understand how it works. Without the proper understanding, you run the risk of losing your assets quickly.

-Inadequate password and seed phrase storage: A backup phrase known as the seed phrase is necessary to gain access to digital wallets where cryptocurrency is stored. These backup phrases must be correctly maintained since if they are lost or forgotten, you will be unable to access your assets or recover your bitcoin. To prevent asset theft, keep them in a location that only you have access to and that is not too hidden so that you can readily find them. You can preserve your seed phrase physically so you don't lose it or forget where it is.

-Ignoring Fees: Many people who are new to using crypto exchanges have no understanding how the gas fee works, they simply purchase it and end up losing a significant amount of money over time. You can save money by discovering the lowest-cost exchange and selecting the most effective method of purchasing cryptocurrency. While looking for exchange that offers low fees it is also important to consider the reputation of the exchange. Sometimes it’s better to use exchange with good reputation even when fee is high.

-Keeping Crypto in Online Wallets: Keeping your cryptocurrency in exchanges or online wallets does not provide complete protection and is easily compromised. Because online wallets do not provide the same level of security as offline wallets, it is preferable to keep your valuables in an offline wallet.

-Getting Scammed: Cryptocurrency users have now become a target for cyber criminals and scammers, the rate at which people are conned online is getting out of hand. These criminals employ a variety of strategies, so I urge everyone especially newcomers to use caution when interacting with others online and avoid falling for their cunning tricks and fake promises. Never share any personal information and never connect your crypto wallet to any untrusted applications.

Finally, I advise my fellow newbies to never overlook minor details that they may believe are insignificant, as they may be the deciding factor in their crypto adventure's success or failure.

[1714200796]

1714200796

[1714200796]

1714200796

[1714200796]

1714200796

[1714200796]

1714200796

[Daniel91]

I think the biggest mistake new crypto investors or beginners make is too high or unrealistic expectations that they will get rich overnight through crypto investing.
It's important to be well informed about everything before any investment, analyze the market in detail and only then make a rational investment decision based on facts and not emotions or expectations.
Of course, it is always important to take care of Internet security, but you should also have a concrete investment plan and a clear exit strategy.
The problem with crypto is a lot of young and uneducated investors who don't understand the high risk of crypto investing.

[EarnOnVictor]

You are valid in all your stated points, and thanks for putting the newbies through to knowing what to do. It would be carelessness and an expensive mistake for any adult to venture into something new without fully being aware of it. In money-related dealing like crypto, many had learned the hard way, you don't rush in, one must first verify the genuity, safety and mode of operation to avoid mistakes and being scammed.

But about your points on wallets, one should not primarily trust the centralised exchange and any custodial wallets. The non-custodial wallets with open source are the best for true ownership of one's coin. The idea of totally condemning online wallets is not cool to me, some are safe to a high degree, except offline wallets are safer. Only people with a reasonable number of coins and long-term holders would opt for that.

[Zaguru12]

I think the biggest mistake new crypto investors or beginners make is too high or unrealistic expectations that they will get rich overnight through crypto investing.
It's important to be well informed about everything before any investment, analyze the market in detail and only then make a rational investment decision based on facts and not emotions or expectations.
Of course, it is always important to take care of Internet security, but you should also have a concrete investment plan and a clear exit strategy.
The problem with crypto is a lot of young and uneducated investors who don't understand the high risk of crypto investing.

Seriously many new investors see cryptocurrencies as a quick get rich scheme and I sometimes blame it more on the orientation they receive. In my locality after the massive bull run in 2018 where many early holders gain huge profit. And With the emergence of new coins and airdrops where they were cashouts people see it as place where they could just earn lots. Some went ahead to invest their entire saving and later regretted it.

It is even a norm now that when you tell people you’re into cryptocurrency they label you as some one rich.
When we educate people about crypto we should inform them that does gaining massive profits now were long time holders or people who gamble with shitcoins which is a huge risk

[kamvreto]

Mistakes due to a lack of basic knowledge are the cause of all the mistakes mentioned. When beginners only know about crypto but do not understand what basic crypto knowledge actually is, they will only assume crypto does not have a big risk and only capitalize on their instincts can get a lot of profit. But that is the beginning of all the losses that will be experienced.

People store passwords or phrases carelessly and carelessly because they don't know how to keep phrases properly to prevent them from being stolen by others.
Ignoring fees without any research will give a large fee when making transactions.
About wallet security needs basic knowledge of how to avoid malware etc. to avoid being hacked and deceived because there is no research on the new project to be followed. It all depends on how much knowledge you have about crypto and others. Learning from scratch and understanding basic knowledge will be very influential for a beginner's journey in crypto. I have even experienced all these mistakes.

[coin-investor]

I guess losing your private keys or seeds and getting scammed is the one that really hurts when you're into this business, you are left on your own the decision are all yours on how to proceed, and you have to choose who and what to trust and how to protect yourself.
Honestly little knowledge is very dangerous in the Crypto world, no knowledge is adequate you must always update your knowledge and always if what you know about security is still relevant in the Crypto world.

[Ndabagi01]

-Lack of Basic Crypto Knowledge: Some people are drawn to cryptocurrency because of the excitement and profits associated with it. As a result, people become obsessed with making money and fail to understand how it works. Without the proper understanding, you run the risk of losing your assets quickly.

This is the most important aspect of cryptocurrency that everyone must understand in order to begin investing here. People's good stories and achievements may be the most compelling reasons for joining cryptocurrency, but they are insufficient to persuade those without prior knowledge of the cryptocurrency market. Many people have come and gone because they had high expectations that were not met. Without this fundamental crypto knowledge, all other market information will be useless to them.

-Inadequate password and seed phrase storage
-Ignoring Fees
-Keeping Crypto in Online Wallets
-Getting Scammed
All these aforementioned can be avoided when a person has the basic crypto knowledge before he/she joins the crypto market.

[Dr.Bitcoin_Strange]

Every crypto newbie is bound to make one or more mistakes; I've made mine 😉, and others have as well, and topics like this have been created to inform crypto newbies, but I know some may not get the right information, and as a result, they will continue to make mistakes. It is normal to make mistakes and learn from them (experience is a good teacher); if they can't learn to get a good knowledge of cryptocurrency before venturing into it, then experience will teach them better. OP, talking about the common mistake crypto newbies make, your first point has it all, because having basic crypto knowledge means you should know about security, which comprises keeping seed phrases secure and also how to avoid some possible scam activities, as well as how to store your coin in a wallet and not on a CEX.

[Issa56]

-Lack of Basic Crypto Knowledge: Some people are drawn to cryptocurrency because of the excitement and profits associated with it. As a result, people become obsessed with making money and fail to understand how it works. Without the proper understanding, you run the risk of losing your assets quickly.

Most newbies entering into cryptocurrency currently don't really have any knowledge about bitcoin, most of them do hear from their friends and family that they are making money from bitcoin and they will also decide to join, Bitcoin is always over hyped to them which at the end if they don't get what they were expecting they are always getting discouraged, and some might endup falling for ponzi scheme thinking it's also crypto.

-Inadequate password and seed phrase storage: A backup phrase known as the seed phrase is necessary to gain access to digital wallets where cryptocurrency is stored. These backup phrases must be correctly maintained since if they are lost or forgotten, you will be unable to access your assets or recover your bitcoin. To prevent asset theft, keep them in a location that only you have access to and that is not too hidden so that you can readily find them. You can preserve your seed phrase physically so you don't lose it or forget where it is.

Most people don't really know how to properly store their private key and incase if you lose your private key, then you are losing your wallet and incase if scammer have access to your private key, then he/she can easily import your private key into his/her device and send out all your funds. If you are storing your private key, make sure it is stored in a place where their is no internet connection and it will be better if you can carve your private key on a steal.

-Keeping Crypto in Online Wallets: Keeping your cryptocurrency in exchanges or online wallets does not provide complete protection and is easily compromised. Because online wallets do not provide the same level of security as offline wallets, it is preferable to keep your valuables in an offline wallet.

One of the greatest mistake that can happen is leaving your coin on exchange, if your coin is in exchange, just assume that the coin those not belong to you, incase if anything happen to the exchange then your money is gone already. Newbies think leaving coin on exchange is really better because it can easily be accessible, but most of them those not really know the risk associated with it. If you leave a coin in exchange, then you don't have full control over the money, it's the exchange that's securing your money for you.

-Getting Scammed: Cryptocurrency users have now become a target for cyber criminals and scammers, the rate at which people are conned online is getting out of hand. These criminals employ a variety of strategies, so I urge everyone especially newcomers to use caution when interacting with others online and avoid falling for their cunning tricks and fake promises. Never share any personal information and never connect your crypto wallet to any untrusted applications.

Some newbies that are scammed in Cryptocurrency just have to blame themselves for that, some of them are busy looking for free money online, some might endup connecting their wallet to different websites, some of them might endup invest in ponzi scheme thinking it's cryptocurrency, they are looking for fast and easy money. I believe if newbies really understand what cryptocurrency is really about, I believe the leave at which people are scammed will reduce.

[The Cryptovator]

People's failure to educate themselves about crypto is their first and most significant mistake. Many initially believed that cryptocurrency was a relatively high way to gain money quickly. The truth is very different. Even novices lack the knowledge important to protect their assets. The main issue is that people get greedy and fall victim to various cryptocurrency scams. After losing money, they do study and learn. Hence, we ought to learn as much as we can. We will be safe once we have a comprehensive understanding of crypto.

[GeorgeJohn]

Just want to emphasize on the aspect of scamming, people can be scam with cryptocurrency due to they are inquisitive to get something, and that is while it's meaningful and necessary to ensure that you are wise in any aspect of your transaction with a strange person. While many people use Bitcoin to scam, it's because the payment procession doesn't take time for confirmation, and secondly more stress will not be attached to it. Compare to the stress of banking system, so any business transaction negotiations that comes along with Bitcoin we have to be watchful.

[sunsilk]

-Keeping Crypto in Online Wallets: Keeping your cryptocurrency in exchanges or online wallets does not provide complete protection and is easily compromised. Because online wallets do not provide the same level of security as offline wallets, it is preferable to keep your valuables in an offline wallet.

This is really a common mistake by most newbies. They think that it's fine to keep their assets in online wallets or exchanges where they are trusting most. They do trust the exchange but they don't know what's the importance of holding their own keys.

The result isn't great at all because we know that this is an important fact being in here. If you don't hold the keys, it means that you don't hold your crypto. And that's the same with the assets being kept in exchanges, you're just seeing your deposited asset but it's no longer you that owns it while it's there.

[Coyster]

Just want to emphasize on the aspect of scamming, people can be scam with cryptocurrency due to they are inquisitive to get something,

I'd say it is due most especially to greed/avarice, not techically that they are inquisitive to get something.

and that is while it's meaningful and necessary to ensure that you are wise in any aspect of your transaction with a strange person.

People shouldn't even trade with strange people except they are taking the necessary precautions of doing it through an exchange. And in other cases for example, if you are approached by someone to send BTC in order to receive more BTC or anything else, then you are about to get scammed. People shouldn't trust, but verify.

While many people use Bitcoin to scam, it's because the payment procession doesn't take time for confirmation, and secondly more stress will not be attached to it. Compare to the stress of banking system, so any business transaction negotiations that comes along with Bitcoin we have to be watchful.

I don't think that's the predominant reason why people use Bitcoin to scam, i think they do so because if the scammer is very smart and is very careful of the exchange they send the stolen funds to, it will be very difficult to trace or link the stolen funds to them because the network is decentralized.

[Cryptoababe]

-Getting Scammed: Cryptocurrency users have now become a target for cyber criminals and scammers, the rate at which people are conned online is getting out of hand. These criminals employ a variety of strategies, so I urge everyone especially newcomers to use caution when interacting with others online and avoid falling for their cunning tricks and fake promises. Never share any personal information and never connect your crypto wallet to any untrusted applications.

Some newbies that are scammed in Cryptocurrency just have to blame themselves for that, some of them are busy looking for free money online, some might endup connecting their wallet to different websites, some of them might endup invest in ponzi scheme thinking it's cryptocurrency, they are looking for fast and easy money. I believe if newbies really understand what cryptocurrency is really about, I believe the leave at which people are scammed will reduce.

Yes you are right, I recently read a post on the forum about someone who got scammed trying to invest to get high APY from an unknown Exchange called hantec. He was scammed. I wonder if he never heard of Binance, MEXC Global, Coinbase and others. These are very popular exchanges with good reputations. But he ignored them for fast money. He learnt his lesson.

[GeorgeJohn]

Just want to emphasize on the aspect of scamming, people can be scam with cryptocurrency due to they are inquisitive to get something,

I'd say it is due most especially to greed/avarice, not techically that they are inquisitive to get something.

Obviously greediness will make you to be inquisitive, so it's obvious that greediness is one of the major factors that makes our investors to lose during investment, and take many people a lot to detect or notice they are getting greedy over the market or investment, what i really understand or capture in some person's kind of investment, is that they don't have take precautions in any of their investment, so most of lacks of ability or knowledge lures some investors to the negative side of investment.

[sheenshane]

-Lack of Basic Crypto Knowledge:

It starts with this.
It's a simple basic knowledge but it's very important to acquire if you are new as a crypto investor.  If you're fully aware of possible scams, getting lost your wallet seed and etc. that result in your Bitcoin loss is just because of the knowledge.

Another factor could be greediness.
Last year, we heard people has been scammed because of double Bitcoin on Twitter or even on Youtube, hoping that the amount they will invest get doubled.

[drwhobox]

This is really a common mistake by most newbies. They think that it's fine to keep their assets in online wallets or exchanges where they are trusting most. They do trust the exchange but they don't know what's the importance of holding their own keys.

The result isn't great at all because we know that this is an important fact being in here. If you don't hold the keys, it means that you don't hold your crypto. And that's the same with the assets being kept in exchanges, you're just seeing your deposited asset but it's no longer you that owns it while it's there.

I think everyone made this mistake once. I used to keep my assets in exchanges and in mobile wallet where I didn't had the control of my own coins. But later I lost some coins form my exchange and they told everyone that there exchange was hacked. I know it can truly be hacked by others or simply they just removing balance from the users and label it as hacked.

Online wallets and exchanges are easy to use compared to wallets where you have the private key or seed phrase. For the advertisement and easy to use reason newbies keep their coins at online wallets.

[Coyster]

Online wallets and exchanges are easy to use compared to wallets where you have the private key or seed phrase.

It is lack of knowledge that would make one think that giving away the responsibility of hodling their coins to someone else is the easy way to store it. The moment you decide to use Bitcoin, you must have as well taken the decision to be your own bank and be responsible for the safety of your funds. It is pretty easy to use wallets that you own the seed phrase/private keys, and if anyone finds it difficult to do, then they prolly shouldn't use Bitcoin until they are ready to be their own bank.

Obviously greediness will make you to be inquisitive,

Being inquisitive means you want to learn/understand something, thus greed/avarice doesn't make one inquisitive, what it does is actually the opposite, as it makes the person entirely focused on accruing profit/making money without learning or understanding how things work actually.

[GreatArkansas]

-Lack of Basic Crypto Knowledge: Some people are drawn to cryptocurrency because of the excitement and profits associated with it. As a result, people become obsessed with making money and fail to understand how it works. Without the proper understanding, you run the risk of losing your assets quickly.

For me, this is a common mistake for new people entering the cryptocurrency world.
While this is a MUST-HAVE thing to have when you are in cryptocurrency. Basics will help you to be safe, smart, and profitable whenever which path you will pursue in the world of cryptocurrencies especially in investing.

[_BlackStar]

-Keeping Crypto in Online Wallets: Keeping your cryptocurrency in exchanges or online wallets does not provide complete protection and is easily compromised. Because online wallets do not provide the same level of security as offline wallets, it is preferable to keep your valuables in an offline wallet.

Investors are never advised to keep all their investment assets on exchanges, and of course offline wallets are much more recommended. It's not just about their financial privacy, but of course more about the safety of their assets in the long term. This means looking after all those investment assets is the most important thing to consider rather than entrusting all budgets to a centralized exchange. The risks are obvious of course, not your keys, so not your assets.

Maybe it will be different from traders, they can keep some budget on the exchange to make trading easier. However, when not actively trading, withdrawing money from the wallet must also be considered. Until now I believed in exchanging for certain amount, that's only in the amount you can afford to lose - of course.