There is no denying that understanding cryptocurrency is difficult. Blockchains, DeFi, and trading can all be tricky to understand, and a lack of understanding in this area can sometimes lead to big mistakes.
But there are things you can do to make cryptocurrency easier for yourself to avoid getting overwhelmed. So here are the best ways to make your crypto experience easier.
1. Limit the number of exchanges and wallets you use
With so many different crypto exchanges and wallets today, it’s easy to sign up for many of them and become overloaded with multiple accounts, passwords, private keys, etc. While it’s not uncommon to use more than one exchange or wallet, it’s essential to only sign up for what you need.
Also, it’s best not to spread your funds across a large number of accounts unless absolutely necessary. Losing track of the location of funds can easily happen in such a scenario. That’s why it’s important to stay on top of the exchanges and wallets you use and only use those that are necessary.
If you’re new to crypto, you might want to consider using exchanges and wallets that are relatively easy to use. Some trading interfaces can be confusing and intimidating, so it’s always worth opting for a less complex trading to begin with.
The same goes for wallets here. Although most software crypto wallets are quite simple, some are easier to understand than others. And, if you want to use a hardware wallet, make sure you know how they work and how to use them before buying one.
2. Understand the key types of crypto
Although all cryptocurrencies are virtual, there are different categories in which a given asset can fall. The two main categories are Bitcoin and altcoins. Of course, the only coin in the first category here is Bitcoin, but it’s the first and by far the most popular cryptocurrency today, so all other coins are generally known as altcoins.
But the altcoin category has a wide range of subcategories, with these subcategories sometimes even having other categories. For example, stablecoins are considered altcoins, but there are four different types of stablecoins.
There are also privacy tokens, utility tokens, and governance tokens. You should also know that there are Differences Between Crypto Coins and Crypto Tokens.
Understanding what each type of digital asset does is essential because you want to know exactly what you are investing in. For example, you wouldn’t invest in a stablecoin if you’re looking to buy low and sell high, because stablecoins aren’t designed to increase massively in value.
So, before making any buying decision in the crypto market, make sure you understand how each type of asset works and what it can offer you.
3. Use a Crypto Stats App
If there’s one thing you need to know about the crypto market, it’s that things can change very quickly. A coin can double or halve within hours, and there are some major opportunities you could miss if you don’t keep up to date.
This is where a crypto statistics app could come in handy. Examples of such apps include CoinGecko, CoinMarketCap, and Crypto Bubbles. These can offer you stats on just about any cryptocurrency, whether it’s market leaders like Bitcoin and Ethereum or smaller players like Sologenic or Dero.
By using such apps, you can check not only the current price of a given crypto, but also its past trajectory, market capitalization, trading volume, etc. Additionally, many of these apps do more than just display crypto statistics.
Take CoinMarketCap, for example. This app offers information on crypto exchanges, posts crypto updates and developments, and has its own community where you can have your say on crypto-related topics and see what others think.
In short, a crypto stats app can keep you up to date with what’s going on and help you learn more about crypto. If you want to find which application can offer you the most, you can check our article on the best crypto statistics apps available.
4. Save and organize your private passwords
Today, scams within the cryptocurrency industry are rampant, with cybercriminals doing everything they can to get their hands on your private information in order to access and steal your funds. This is why passwords, private keys, and seed phrases are used in the crypto industry.
But when you have multiple crypto-related accounts, whether with an exchange, wallet provider, lending platform, or anything else, it can be really difficult to keep track of your passphrases.
However, losing your private key or seed phrase is not like losing your Facebook password. It can be very difficult to create a new private key, and if you lose your seed phrase, you can’t get a new one, meaning the wallet it’s linked to is now unusable.
This is why it is important to organize your private data and store it very securely. Many choose to store their login details offline, either on a hard drive or simply on a piece of paper, which is then stored in a safe and secret location.
Although you can use a virtual password manager to do this, we do not recommend using apps to store highly sensitive information, as these apps are always at risk of malfunctioning or hacking.
5. Know your options
The crypto market does not only involve the buying and selling of digital assets. There are now many things you can do with your crypto funds beyond basic trading. Staking, lending, borrowing, and futures trading are all options for crypto holders.
The DeFi field is now incredibly diverse, so it’s worth researching what you can do with your crypto holdings before making any firm decisions.
Some exchanges, like Binance, are known for their wide range of options for expanding your crypto portfolio, while others are more limited in their functionality. So, depending on what you want to do with your crypto, some exchanges may be more suitable for you.
Some retailers also accept payments in the form of cryptocurrency, giving you another way to use your funds. You can consult the best retailers that accept bitcoin where to find Shiba Inu-friendly establishments if you want to spend some of your holdings on crypto.
Crypto can be confusing, but you can also simplify it
It is natural to view the cryptocurrency market as daunting. Many consider this field only suitable for technology and finance professionals, but that is not the case. By using the tips above, you can simplify your crypto experience and keep things manageable and simple.
The information on this website does not constitute financial advice, investment advice or trading advice and should not be relied upon as such. MakeUseOf does not give advice on trading or investment matters and does not advise buying or selling cryptocurrency, ever. Always perform your own due diligence and consult a licensed financial adviser for investment advice.