New to crypto? Steer clear of these four mistakes
Fear of missing out (FOMO) often leads to rash decisions—research first to avoid regrets
While the crypto world has seen incredible success stories, it has also been filled with cautionary tales of failure and loss. Learning from these costly mistakes can help beginners avoid common pitfalls in crypto investing. As the saying goes, prevention is better than cure.
Let’s take a closer look at some of the most common mistakes crypto beginners make—and how to avoid them.
1. Sending to the wrong wallet address
Crypto wallets are used for sending and receiving funds, each with a unique address specific to its network.s.
A common mistake beginners make is mistyping the address or sending assets to the wrong destination or network. Unfortunately, once the transaction is executed, these assets are usually unrecoverable.
To avoid this, always double-check both the wallet address and the selected network. Use copy-paste or scan the QR code for accuracy. As an extra precaution, try conducting a small trial transfer before sending large amounts.
2. Skipping research (DYOR)
DYOR—or “do your own research”—is crucial when it comes to crypto investing. Rather than giving into impulse and emotions like FOMO (fear of missing out), traders should carefully research a crypto project's fundamentals—its whitepaper (the document that contains the most important info about the project), community, founders, and other important information.
Since the internet is flooded with information, not all of it is reliable. Always fact-check and scrutinize sources. Be cautious with recommendations and price predictions, taking them with a grain of salt.
3. Falling into rug pulls
The crypto space is rife with scams, including rug pulls. In these schemes, developers abandon a project and disappear with investors’ funds, leaving those holding the token with significant losses as its value plummets.
To avoid rug pulls, check the project's social media channels, official websites, and founding team.
Avoid tokens released in the past 24 hours, especially those experiencing sudden price spikes—these are common tactics used to exploit FOMO.
4. Overlooking fees
Buying and selling crypto involves fees, including those for the blockchain and exchange. These can quickly add up, eventually reaching as high as hundreds of dollars.
Before executing any transaction, research fees and look for cost-effective options.
Avoiding these common mistakes can save you money, time, and frustration as you start your crypto investing journey. After all, with every step you take to educate yourself, you’ll be closer to making confident and informed decisions in this ever-evolving landscape.
