Welcome, Crypto Dummies!
IF you’re new here, this substack focuses on educating those who know nothing about crypto and blockchain technology. If that’s you, you’ve come to the right place!
For those of you that have been tuning in regularly, welcome back! It’s been a hectic week in the crypto community, followed by a lot of volatility within various sectors of the crypto market.
In the middle of all the craziness, we felt like it would be a great time to go over the 10 Crypto commandments. Whether you’re a crypto dummy or a (self-proclaimed) crypto guru, it’s always best practice to abide by these 10 simple rules.
Let’s get started!
1. Not your keys, not your coins.
As a reminder to everyone, whether you are new to the space or a seasoned veteran, if they’re not your keys, they’re not your coins. Centralized exchanges have been the easiest way to onboard newcomers to the decentralized world. Applications like Coinbase, Binance, FTX, and many others are convenient ways to exchange your cash for digital currency. One mistake many users make is leaving their valuable cryptographic coin stored in such exchanges, where the exchange holds access to your keys. If Coinbase, Binance, or FTX, hold your coins on their platform, they are not your coins.
Exhibit A.
2. Own a Hardware Wallet and Digital Wallet
Owning a hardware wallet and making a digital wallet is the bare minimum for anyone entering the crypto space. This goes hand in hand with our first rule. Crypto brings the power of finance back into the hands of the individual. This means you are responsible for your coins, and keep them stored in a secure hardware wallet. For funds you anticipate accessing regularly, storing them in a digital wallet is the best practice.
For hardware wallets, Trezor and Ledger are the most popular and easy to use, this is perfect for beginners. Metamask is by the far the most popular Digital wallet, and your best bet as far as digital wallets go.
3. NEVER Share your seed phrase
This should be common knowledge for ALL. When setting up your hardware or software wallet, you are given a 12-word mnemonic passphrase. This “seed phrase” is the key to your wallet and the currency stored within it. Keep this in a safe, secure location, and NEVER share this with anyone. The best practice is to memorize your seed phrase. Should you get locked out of your hardware or software wallet, the only chance at recovering your funds is this magical 12-word passkey.
4. Never open links in your DM’s. 99.9% of the time it’s a scam
Nowadays the crypto influence is everywhere on social media. BAYC holders have their own small piece of Twitter real estate and happen to be the most prone to hacks and scams (coincidentally of course). Scammers have upped their ante as of late, with numerous new and creative ways to drain wallets, steal NFTs, and trick others into giving up their seed phrase. NEVER open random links in your DM’s. Most projects will never dm you first, so if you get a dm that seems too good to be true, 99.9% of the time it is.
5. Remain Anonymous
Let’s be real here, having a blue-chip NFT is great. Flaunting that you have a blue-chip NFT? Not so great. Remaining anonymous is one of the more underrated commandments in crypto. In a decentralized world where anyone can easily track a wallet’s spending, the last thing you want is to have a target on your back. Being anonymous adds an extra layer of security between you and anyone who may try to hack/harm you.
6. Don’t trust Social media Influencers/ “Crypto Gurus”
Influencers are not your friends. 9/10 times they are going to dump on you.
While there are many personas on social media that share valuable information about upcoming projects, not all of them are there to help you. A majority of self-proclaimed ‘Crypto Gurus’ are paid by a project to shill (promote) a token to you. They capitalize on a large following and proceed to dump on their followers. Don’t become their exit liquidity
7. Use ALL the tools available at your disposal
Familiarize yourself with all the tools available to you. There are a lot of great projects out there, and twice as many scams. The best way to avoid scams? Educate yourself, learn how to use Etherscan, Tokensniffer, etc. Learn how to track accounts and how to check token contracts. Unless you don’t mind throwing your money in a black hole.
For more info on this check out some of our older posts:Etherscan Tokensniffer
8. Bookmark frequently used websites
One of the easiest ways to lose in crypto is to become a victim of phishing sites. Keep frequently accessed sites bookmarked, and always check the URL. The last thing you want is to log in with your CEX account on a phishing site or to connect your wallet to a scam DEX(Decentralized Exchange) link.
9. Never invest more than you are willing to lose
Crypto is full of opportunity. Many new users treat crypto like a casino, gambling on worthless coins hoping to 1000x their money. Never invest more than you are willing to lose. There are way too many scam projects circulating in the crypto universe, 95% of these will not make it. If you put your entire life savings into a meme coin, be prepared to lose it all. Create a backup plan, and invest what you can lose. Never go all-in with everything you own.
10. DO YOUR OWN RESEARCH
This brings us to our final and most important crypto commandment. Do your own research. A majority of these crypto projects will not be here in the long run, educate yourself on the projects you are interested in before investing. Never buy a coin because someone else told you to buy it. Learn the fundamentals, join the team’s official discord, telegram, etc. and hold yourself accountable to stay educated.