After 5 years of crawling in the crypto world, I've summarized 10 lessons from my painful experiences. Newbies can save hundreds of thousands after reading this!

As a seasoned player in the crypto world for 5 years, from initially losing 30,000 in principal to now being able to make stable profits, the pitfalls I've encountered could pile up into a mountain. Today, I want to share my hard-earned experience in avoiding pitfalls with newbie friends. Remember these 10 points, and you'll at least be able to avoid 90% of scams and losses.

1. Contracts are a "guillotine" for newbies, don't even touch them!

When I first entered the crypto world, I heard people say that contracts could leverage small amounts into large gains. I tried it with the only 5000 yuan I had left, and within 3 days, I lost everything. Later I learned that not only can we newbies not withstand the leverage risks of contracts, but many so-called "experts" among the old players often fall into the same trap. The most prudent approach for newbies is to focus on spot trading, choose the right coin, and hold it for the long term, which is much more reliable than gambling luck in the contract market.

2. Small coins should not be touched; they can go to zero in an instant.

I remember back in 2020, I was pulled into a "hundred times coin" community, heavily investing in a little-known altcoin. As a result, it dropped 99% in less than half a month and was ultimately delisted from the exchange, leaving me with nothing. Most small altcoins in the crypto world are tools for harvesting inexperienced investors. I firmly avoid altcoins with small market caps and low recognition, prioritizing mainstream coins like Bitcoin and Ethereum. Although their growth may not be as exaggerated, at least they won't easily go to zero.

3. Don't go to small exchanges! The risk of them running away is higher than you think.

In 2022, there was an incident where a small exchange ran away with funds, and I have friends who fell victim to it, with over 200,000 in funds that have not been recovered to this day. Small exchanges not only might run away with funds but may also perform operations such as 'pulling the plug' and 'restricting withdrawals', which firmly traps your funds. I advise everyone to choose only top mainstream exchanges, and if you have a large amount of funds, you can spread them across 2-3 exchanges to reduce risk.

4. Stop fantasizing about tenfold or hundredfold returns; breaking even is winning.

When I first entered the crypto world, I always thought I could achieve financial freedom through coins, blindly chasing various "potential coins," and ended up losing more and more. The crypto world today is no longer the era of barbaric growth; major institutions and professional investors have all entered the market, and the probability for ordinary people to earn ten or a hundred times is almost zero. Nowadays, being able to achieve double returns is already considered top-level, and if a newbie can avoid losses in the early stages, they have already outperformed over 90% of investors.

5. Be cautious when selecting unknown wallets; there are considerations for storing large amounts of funds.

If the amount of funds is large, it is recommended to keep them in a wallet where you can control the private keys, as exchanges are also at risk of hacking and platform shutdown. However, be sure to avoid those unknown small wallets; a friend previously used a niche wallet, and as a result, the platform disappeared, the private key could not be verified, and the funds were directly lost. Prioritize choosing mainstream wallets that have a good reputation and high security in the industry, and make sure to back up your private keys before storing.

6. Scalping is not for newbies; holding quality coins is the way to go.

The fluctuations in the crypto world far exceed imagination, with Bitcoin dropping 20% in a day and altcoins often being halved. I also tried doing very short-term trading in my early years, frequently buying and selling, but in the end, I lost quite a bit on transaction fees and missed out on several market trends. Newbies simply cannot control short-term volatility; it's better to choose quality coins for long-term holding, reduce trading frequency, and it can lead to more stable returns.

7. Stop-loss and take-profit must be strictly enforced, don't let greed ruin your profits.

This is a lesson I learned with real money! During the bull market in 2021, I held a coin and made a 50% profit, but I kept thinking it would go higher and didn't take profits in time. As a result, the market reversed, and I not only gave back all my profits but also lost my principal. Later, I set rules for myself: pre-set stop-loss and take-profit levels, resolutely sell when it hits the stop-loss line, and decisively exit when it reaches the target price, regardless of how the market moves afterward. This has helped me avoid many significant losses.

8. Invest spare money! Don't put all your assets into the crypto world.

The risks in the crypto world are extremely high, not only because of market volatility risks but also policy risks, deposit and withdrawal risks, etc. I have seen people invest all their money for buying a house and retirement into the crypto world, and in the end, they lost everything and even incurred debts. I advise everyone to only use their spare cash for small investments; even if they lose, it won't affect their normal life. Once they have accumulated enough experience and strength, they can consider increasing their investment.

9. Continuous learning is the foundation of profit; cognition determines the upper limit of returns.

When I first entered the crypto world, I blindly followed trends to invest because I didn't understand blockchain technology and was unaware of the fundamentals of projects. The money I made quickly returned to losses. Later, I began systematically learning about the crypto world, studying project white papers and keeping an eye on industry trends, which helped me slowly find my investment rhythm. Remember, one can never earn money beyond their understanding; only by continuously learning and improving oneself can one survive long-term in the crypto world.

10. Find a reliable teacher to avoid three years of detours.

The crypto world is full of pitfalls, and it's easy to step on landmines just by relying on your own exploration. If I had an experienced teacher to guide me in my early years, I wouldn't have lost so much money. In the crypto world, over 99% of people are at a loss; finding a reliable teacher who is willing to share knowledge might not guarantee immediate profits, but it can at least help you avoid many deadly traps and save you from taking unnecessary detours.

The crypto world has never been a paradise for getting rich overnight, but rather a battleground that tests one's understanding, mindset, and patience. The market is always there, but opportunities are only left for those who are prepared. I hope my experiences can help friends who have just entered the circle to avoid traps and walk more steadily and further in the crypto world!