5 Rookie Errors When Buying Bitcoin
There are many mistakes that can be made when buying bitcoin. From using a bad exchange to not having the right information, you need to be aware of these errors before they happen. Here are five beginner mistakes you can avoid.
- Uses the wrong wallet
There are many types of wallets out there, but most beginners start with a software wallet or an online wallet. The problem with these wallets is that they are vulnerable to hacking and theft. If your computer crashes, all your coins are gone forever! Most people buy bitcoin from exchanges like Coinbase, which charges a 1% fee and requires customers to verify their identity with a publicly issued ID, submit a photo of themselves with that ID and link their bank accounts to the website. Buying too much at once or selling too early after buying an asset can lead to huge losses for new traders as well as experienced ones who do not understand how markets work.
It’s fine for transactions worth a few hundred dollars or less, but it’s not really necessary for people who want to buy bitcoin as an investment or as part of a larger business deal. Coinbase has some of the highest fees among bitcoin exchanges; other sites charge as little as 0.25% per transaction. And while it is possible to buy fractions of bitcoin (ranging from $ 2 worth over $ 10,000), most exchanges do not allow customers to buy small amounts because they have to perform too many microtransactions at once – too many moving parts means higher fees for everyone involved. However, CoinSpot: BTC Wallet is one of the best wallets in the industry.
- Does not use two-factor authentication (2FA)
Two-factor authentication is one of the best ways to protect yourself from hackers and other scammers on exchanges such as Coinbase or Bittrex. It requires several steps before you can access your account, making it harder for criminals to access your money in case they accidentally steal your password or private key (something that has happened before).
- Not knowing the difference between fiat currency and cryptocurrency
Cryptocurrency is different from fiat currency because it has no physical form like dollar or euro. This means that it is even more important to keep track of where your money goes!
- Not knowing what you want from the market
Like any other investment fund, you need to know what your goals are before you start trading. If your goal is long-term investment, then buy and hold. If you want to trade in and out of positions quickly, then go for a more active approach.
- Does not use a secure wallet or purse
You need to keep your cryptocurrency in a safe place where no one else can access it – this is why some people keep their cryptocurrencies in hardware wallets or in cold storage. There are also exchanges that offer their own wallets and insurance against theft (such as Coinbase). While these services may seem practical at first glance, they pose additional risks that come with relying on a third-party service provider. This means that they can also be hacked and your money stolen – just like traditional banks!
