Remember when I first entered the market and got completely wrecked by the stock-trading mindset? Today, I’ll sort out the basic knowledge of cryptocurrency trading and help beginners avoid pitfalls.

First of all, the biggest difference is the freedom of trading hours in crypto. Unlike the stock market, which has set opening and closing times, the crypto world operates truly 7×24 hours, nonstop all year round. Labor Day, National Day, Spring Festival, and weekends are rest days for stock traders, but they don’t exist at all in the crypto market. Because users are spread across different time zones worldwide, price movements and fluctuations happen all the time—this is also why crypto trading hours are so enticing: you can seize opportunities anytime.

Next, let’s talk about trading units. In A-shares, the minimum lot is 100 shares per lot, but in crypto trading, transactions can be as precise as 0.0001 BTC, which directly lowers the entry barrier. You can start participating with just a few hundred dollars—no need to gather enough money to make a full lot.

The trading models are also worlds apart. Stocks follow T+1: buy today, and you can only sell tomorrow. Crypto trading has none of this restriction—sell whenever you want, achieving true T+0. That’s also why short-term traders especially like to “stir things up” in this market.

When it comes to order types, you need to understand limit orders and market orders. A limit order means you set a specific price; once the market reaches that price, the order will automatically execute. For example, if BTC is currently 6500 US dollars and you think 6300 US dollars is a good price, place a buy order at 6300. Once the price drops to that level, there’s a chance it will fill. A market order, on the other hand, executes immediately at the current market price—fast, but the actual execution price may deviate.

You also need to grasp advanced concepts. A bull market means the overall market outlook is optimistic and prices are generally expected to rise. A bear market is the opposite: people are generally pessimistic, and declines continue. Take-profit and stop-loss are habits you must develop. Take profit means you run once you’ve earned enough—don’t be greedy. Stop loss means admitting defeat once your losses reach a certain point, to prevent liquidation. Sounds simple, but in real operation, the psychological battle is especially hard.

You also need to understand getting trapped and breaking out. Getting trapped means that after you buy, the coin price keeps falling, and the unrealized loss exceeds what you can tolerate. Breaking out is when the coin price rebounds afterward, turning a loss into a gain. There are also the concepts of overbought and oversold: when the price jumps sharply in a short time to a level that fundamentals can’t support, that’s overbought; conversely, a sudden sharp drop in the short term is oversold. In technical analysis, RSI above 75% counts as overbought, and below 25% counts as oversold.

Spoofing longs and spoofing shorts are tactics that market makers commonly use. Inducing buying (spoofing longs) means creating a false uptrend appearance to lure you into entering, and then dumping. Inducing selling (spoofing shorts) means creating a false downtrend appearance to trick you into shorting while the price is going down “on paper,” and then rallying. Cutting losses means selling at a loss—painful, but sometimes necessary. Missing out means the market rises and you don’t buy, watching opportunities slip away helplessly.

To be honest, the flexibility of crypto trading hours is indeed more satisfying than traditional markets, but precisely because of this freedom and the lack of limits on daily gains or losses, the risk is also higher. One second it might hit the daily limit up, and the next it could go straight to zero. So new traders must first fully understand these basic concepts, and then use small-money spot practice before trading with real funds—otherwise, the excitement of crypto trading can turn directly into losses.