Thinking back to the time when I first started investing into crypto made me want to write an article about all the stuff that I wish I knew back then when I started. This might have saved me some sleepless nights and a lot of bad mood days. That is why in this article I will talk about stuff that I learned so far and that you can adopt in your crypto experience as well.
Stuff That I Wish I Knew Before
Like many of you, I myself, got into crypto because of Bitcoin. In the beginning I started carefully in investing just in Bitcoin and tried to ignore all the other coins since I did not understand them fully and had no trust in them at all. Oh boy was I wrong. While many BTC maximalists think that BTC is the true and only, I have the opinion that a future with multiple crypto projects is the way to go. That is why I started to look into projects like Cosmos who are trying to connect all of the different blockchains together and try to make them interoperable. Of course there is also the big player like Ethereum which already proofed itself by being the biggest used blockchain. And lets not forget blockchains like Hive where you can play amazing P2E games like Splinterlands or earn blogging rewards!
Another important point I wish I knew back then, is the risk vs reward ratio that you can take. When I first started I tried to invest very carefully and only buy the dips. That left me very unhappy because I was checking the market every hour just to time it perfectly. After a while I started dumping more money into the market but unfortunately for me, all at once. After that I discovered for me the Dollar cost Average method. With this method I set up a routine on which I invest and forget about the market movement. Of course, I am trying to benefit from the big crashes like the recent one, but in general I have a weekly amount that I am spending regularly. It is important for me to stress that everybody should only invest money that he or she is willing and able to afford to lose.
Speaking of investing. The more time I spent in the market and researching projects, the more I understood one of the most basic problems in crypto currency. The famous trilemma is a trade off of three major components in the crypto space: security, scalability and decentralization. While a lot of projects manage to be extraordinarily good in two of the three parameters, the third one always lacks. That is why no project is perfect and needs to have further research before investing more into them. While investing in these projects, I wish I knew in the beginning how to evaluate the projects. It took me a lot of time to understand the basic factors like market capitalization, the vesting schedule and the overall supply and demand. The perfect example is Ethereum. Because it has so many applications and because it is used to pay fees on the network the demand for Ethereum is very high. Additionally, the supply was cut so that Ethereum can be on some days a deflationary asset and that is why its price was rising in the past few months.
One of the most important points I want to mention are the scams. In recent times the scams became more and even a lot of influencing personalities got into promoting scam projects. This should be a warning for all investors because it means that you should always do your research on the developing team and the core parameters. I wrote an article about how to discover such scams in the following ARTICLE.
Last but not least I wanted to talk about all the other ways of earning in the crypto space. In the beginning I was just holding the Bitcoin as an asset and was happy with myself. Thinking back, I wish I could slap myself and get into DeFi and some P2E games earlier. With some DeFi processes like liquidity pools or the lending options it is extremely beneficial to earn a good amount of passive income. Of course, there is always risk of losing money because the asset is depreciating but this risk is in every asset. Furthermore, there are a lot of fun opportunities to earn money just by playing games. One of these games is Splinterlands and while I was very skeptical at first, I am really enjoying playing this game and am able to earn some amount as additional rewards. Here I also want to stress that this only works if you don’t expect to become a millionaire overnight. To set up and find the correct processes is a matter of time and trial and error. That is why I recommend to never give up even if something frustrating happened.
Conclusion
To summarize this article, I wanted to say that the crypto space thought me already some lessons that are helping me every day. And yes, some of these lessons were hard but they are currently paying off and I hope that this journey will continue to go upwards. I really hope that maybe I could inspire some people to stick in the crypto market and maybe even reach some new people to try it out. Speaking for myself this journey is a lot of fun and very rewarding from a certain point on!
Published by ga38jem on
LeoFinance|Steemit|read.cash
On 9th December 2021