Simple Ethereum Investing Mistakes to Avoid

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In about ten years, cryptocurrency changed from something no one knew about to a favorite investment for many people. It began with Bitcoin, and now there are thousands of different types of cryptocurrencies.

When Bitcoin gets to be too expensive, Ethereum can be a great alternative. Some jump right into comparing. 1 ETH to USD, but there are a few basic investing mistakes to keep in mind so that they can be avoided entirely.

Forgetting Passwords or Phrases

It might sound like a simple thing to avoid, and it is. Yet there are horror stories every day of crypto investors who forget their password or seed phrase. As cryptocurrency is stored in a digital wallet, having that password or seed phrase is the only way to gain access. If you can’t remember it, you won’t be able to gain access.

Even worse, there are a limited number of opportunities to figure it out. There is no “lost password” feature that can be compromised. Guess wrong enough times and the wallet will remain locked, the funds within lost for good. Keep that password or seed phrase jotted down somewhere that is only accessible to you in order to avoid the very worst-case scenario.

Getting Scammed

There is a misconception that only old or misinformed people get scammed in the online world. Unfortunately, scams have gotten a bit more sophisticated and have taken advantage of more than a few people in the process. In the cryptocurrency world, scams are even more prevalent because of how much money can potentially be in the mix.

It is estimated that in 2021, nearly $700 million of cryptocurrency was stolen. With sophisticated scamming methods in use, it is all too easy to fall prey. Keeping your wallet in cold storage is a great place to start. Be aware of common scams and never, under any circumstances, give away your seed phrase, private keys, or wallet password to anyone you do not know and trust.

Wrong Wallet Address

In order to take ownership of cryptocurrency, it needs to be transferred from one digital wallet or exchange to another. One of the most common mistakes that new cryptocurrency investors make is trying to make a transfer only to end up entering the wrong wallet address.

Sending cryptocurrency to the wrong wallet can result in lost, unrecoverable funds. Depending on the circumstance, there may be ways to recover those funds, but they are almost always very expensive. It is a simple thing to avoid that could wind up saving in more ways than one. Take the extra time to verify the wallet address to avoid this simple mistake.

Getting to Complicated

Some investors feel as if they have to employ a complex strategy in order to succeed at crypto investing. That is one of the biggest misconceptions that new investors should avoid. Oftentimes, it happens when following a well-known crypto investor who has been in the game for a long time. In reality, those complicated strategies can be the fastest way to a major loss. It takes time to learn conditional orders, how crypto markets work, and how to learn technical analysis.

As it turns out, investing in cryptocurrency can actually be quite simple. Especially when starting out, keeping things simple can help to avoid potential pitfalls. As more experience is accrued, employing more complicated strategies may become part of the equation. For now, try to limit how much you actually do when investing in cryptocurrency to keep the mistakes to a minimum. It might not be the sexiest way to invest but it certainly is the smartest.