Knowledge is power. However, when we first got into the cryptocurrency market, we all started with a knowledge base of zero. This means that we have all made several mistakes since we have gotten into the market.
The problem is that the cryptocurrency market is the last open frontier; the Wild West. Mistakes are waiting to be made, and danger is lurking around every corner. There is no one holding our hands to protect our portfolios. No one is making sure our transactions go through smoothly, protecting us from investing in pump-and-dump scams, and no one telling us exactly what we should be investing in. We are using real money and fortunes can be lost in an instant. Causing regrets that will last a lifetime.
Thankfully for you. Many of us have already made these mistakes and want to help you avoid the same fate. You can learn from our horror stories in crypto and continue on your path toward reaching financial freedom. Today I will be sharing a few of the mistakes that I’ve made in crypto that still eat at my thoughts today. Like I said before; knowledge is power. In crypto, if you have an open mind that is proactive and willing to learn. You will be able to be extremely successful and be able to avoid the dangers that are lurking everywhere.
1) Selling too early — Missing out on Millions of Dollars
For those of you who have been in crypto for the last two years, you will be familiar with the amazing price run that Dogecoin had. Starting at being only a fraction of a cent, all the way to being worth 70 cents. When I first got into crypto I saw Dogecoin and was excited at the idea of how many coins I could buy due to its low price. I had dreams of how much money I could make if Dogecoin would somehow soar to being worth 1 cent someday. And so I bought some. I ended up owning nearly 7 million Dogecoin just by throwing a little bit of money at it when it was worth practically nothing.
But as many of us stay in the market for a longer duration of time, we become more serious investors. Trying to invest in the projects that are considered the“blue-chip” coins in the market, such as Bitcoin and Ethereum. The crypto that most of us agree will still be around and thriving ten years later. And at the end of 2019, I converted all of my Dogecoin into BTC and ETH.
Throughout the majority of 2020 that plan worked out fantastic, and I would still argue that it was the smart decision. But, I have also learned that once you have built a solid foundation for your crypto portfolio. It doesn’t hurt to throw a small amount of money at a low-cap coin that may result in you hitting the lottery.
Towards the end of 2020, Elon Musk came out in favor of Dogecoin, which instantly put a giant weight in my stomach that has been gnawing at me these last two years. I knew I had missed a chance to make a lot of money. I sat on the sidelines watching Dogecoin climb all the way up to 70 cents. Thinking of what might have been. If I had just held onto my Dogecoin a few months later and sold near the top, I could have made $4,900,000 off just a few hundred dollars initially invested. Fast forward to today and he has taken control of Twitter and looks as if he will find many ways to implement Dogecoin. Which will cause it to pump further. I have done very well in the crypto market, but I will forever be thinking of what might have been.
The truth of the matter is that the longer you are in crypto, we will all have similar stories to this one. We need to always have an open mind and be on the lookout for what could be next.
2) Funds Lost on UST / Lending Services
I often nickname the summer of 2021 the summer of chaos. The summer when those who got greedy in the market were taught just how foolish they had been. The period that we were all taught the real meaning of “not your keys, not your coins.” With companies and third-party lenders becoming insolvent, many of us had our funds frozen on lending services such as Celsius, Voyager, Vauld and the list goes on. I was very lucky to escape that mess unscathed, especially considering how enthusiastic I had been about earning passive income on my crypto by lending.
But, that isn’t the complete story. I didn’t escape the UST situation unscathed and lost what I consider to be a substantial amount of money. The interesting thing is that I was skeptical about lending UST to earn a passive income from the beginning. Which is also the thing that ended up protecting me as well. Feeling that the interest rates of nearly 20% were too good to be true and eventually something would go wrong.
After enough time had passed, I became a little careless and thought, “why not?” Putting a few thousand dollars on the platform to earn passively. Literally, one month later is when UST/Luna became de-pegged. I was watching the entire situation play out live, seeing the value of my UST decrease rapidly. Holding out hope that it would recover. After all, Do Kwon did say they would send deploying funds. However, I had a bad feeling in my gut and decided to cut my losses while I still could. Which ended up being at 0.71. I took a haircut of 29%, due to my greed, and cost me over a thousand dollars. A very valuable lesson.
However, I am very thankful that I sold when I did. After all, UST would keep falling from there and go nearly to zero. By cutting my losses somewhat early, I lost only 29% instead of 100%. The key lesson is this. In crypto and life in general, if something seems too good to be true. It likely is. We all believe crypto prices will eventually be going to the moon, and we need to do our best to keep our portfolios safe until that happens.
3) Sending to the Wrong Addresses
Do you remember how nervous you were when you were sending your first crypto transaction? Anxiously waiting for it to be confirmed and show up in your wallet. After you have been investing in crypto for a while, eventually that feeling of uneasiness will fade away. That is when the danger comes in. Sometimes we are in a rush, not fully awake, or just not feeling well and want to send the crypto transactions as quickly as possible.
That is exactly what happened to me. I had covid but was needing to send some crypto to pay off a bill. As you can imagine, since I had covid I was not feeling my best and was not fully aware. I sent the transaction as fast as possible and sent it on the wrong chain. Sending on Ethereum instead of Polygon. The money was lost, and once again I was taught a valuable lesson. It wasn’t a huge amount of money, but it was still enough to sting. Never send crypto transactions when you are not fully awake or aware. It could end up saving you from yourself.
These are just a few of the mistakes that I have made in crypto over the years. I know for a fact that I will continue to make mistakes, but I hope to minimize them as much as possible. All we can hope for is to learn each day and become better. If we can do that, then we will all be able to make it in crypto and become successful.
How about you? What mistakes have you made in crypto?
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As always, thank you for reading!