Five Mistakes to Avoid in Crypto

Not doing your own research

As a crypto investor you should do your own research to ensure you understand what you're about to buy or sign. Good research gives a better overview of the longer term outcomes that are likely to happen. Investors have confidence in projects they understand and know more about. With good research you have no one to blame in case of a downtrend.

Forgetting your recovery phrase words

This is a mistake many people make and they end up loosing their coins. Without these words it becomes very hard to recover the coins. To avoid this, I advice you jot them down on a piece of paper and hide it in a place that no one can access it except you. I discourage writing them on phone notebooks because they can easily be deleted or hacked and accessed.

Buying and storing all your assets in one site

Placing all your crypto coins in one exchange or wallet can be very risky if it is compromised. I advice crypto investors to subdivide their assets and storing them in different exchanges/wallets. This ensures that if they loose some coins in one exchange they can still have some left. I discourage using an exchange as a wallet because we have heard cases of exchange sites being hacked and customers funds being stolen. I prefer storing your coins in software and hardware wallets.

Investing in one asset

This is very risky because if the coin dumps heavily there's a high chance that you'll be wrecked. It is important to diversify by ensuring that the relationship between the coins forming your portfolio is negative in such a way that if one coin looses, the other one gains and vise versa. Having several coins is key because different crypto coins pump and dump at different times.

Fear of missing out (FOMO)

This is one of the first mistake that many newbies in crypto make. When a coin starts pumping and there's a lot of hype in the market, a majority think they'll never have the chance to buy the coin again at a bargain. This forces them to panic buy at high prices. In a majority of the cases these coins then drop in price after the hype.

Crypto is an ever learning game and as a crypto trader you should learn new things every day. Always learn from your mistakes and aspire to do better.