Recently, I’ve noticed more and more people around me want to enter the crypto world, but most are clueless and don’t know where to start. Instead of getting caught in pump-and-dump schemes, it’s better to understand the basic logic of entering the crypto space first. Today, I want to share some of my insights.

Honestly, trading cryptocurrencies is similar to trading stocks or real estate—buy low and sell high to profit from the difference. However, digital currency trading is more free, operates 24/7 without interruption, has no limit on price fluctuations, and offers profit potential far beyond traditional stock markets and futures. That’s why so many people are attracted to it.

But to start trading crypto, you first need to find a reliable exchange. An exchange is a platform for trading digital currencies, and larger, reputable exchanges tend to be safer. Each exchange also offers different coins; some smaller coins can only be bought on specific exchanges.

Once you’ve entered an exchange, you’ll find that buying coins directly with RMB isn’t possible; you need to first buy something called USDT. USDT is Tether, issued by Tether Limited, and 1 USDT equals 1 USD, which can be understood as a digital dollar. First, buy USDT with RMB, then use USDT to exchange for the digital currency you want. This process is called trading coins.

To get started in the crypto space, you must learn some basic terminology. For example, “position” refers to the proportion of your investment funds. “Full position” means buying everything, while “reducing position” means selling part of it. “Take profit” and “stop loss” are very important—one is for realizing gains, the other for preventing losses from expanding. A “bull market” means prices are continuously rising, while a “bear market” means prices are continuously falling. “Going long” is buying with a bullish outlook, “going short” is selling with a bearish outlook. There are also terms like “cutting losses,” “being trapped,” and “breaking free,” which are common situations encountered daily.

Mainstream cryptocurrencies usually refer to those ranked high by market cap. Bitcoin is the big brother, Ethereum is the second, and coins with high market cap are generally more recognized, have better liquidity, and carry relatively lower risk. Conversely, smaller coins tend to have poor liquidity and higher risk, so beginners should be cautious.

Here, I want to emphasize the risk especially. Ethereum’s creator Vitalik once said a very prudent piece of advice: “Don’t invest any money you can’t afford to lose.” Beginners should be especially careful—never borrow money, take out loans, or use credit cards to trade crypto. This is the easiest way to get liquidated.

Regarding contract trading, many people see it as a quick way to get rich, but it’s also the easiest way to go bankrupt. Contracts allow you to leverage your margin for bigger gains—for example, 1% margin with 100x leverage. It sounds tempting, but the risks are amplified exponentially. Beginners should definitely avoid contract trading; it’s not the fastest way to wealth, but the fastest way to liquidation.

To play the crypto game long-term, three things are very important. First, an Android phone, for installing various apps easily. Second, spare money—funds that you don’t need urgently right now, so losing them won’t affect your life. Third, mindset—trading crypto involves risks, and those who are anxious or overly greedy are most likely to get caught.

Honestly, there are many ways to make money in the crypto space beyond just trading coins. No matter what, returns are always proportional to investment. I hope everyone can gain something in this field. Recently, I’ve been paying attention to some asset trends on Gate.io; if you’re interested, you can check them out yourself.