Getting Started with Cryptocurrency Investment: The Complete Beginner's Guide

Over the past 10 years, the cryptocurrency investment market has experienced remarkable growth. Many investors have generated substantial returns through long-term holding, and recent moves by governments to secure digital assets have led to a significant increase in novice investors interested in this field. However, stepping into the world of cryptocurrency investing can still be challenging for many prospective investors.

In this article, we will explore the key concepts to know before starting cryptocurrency investment, the types of trading methods, major target cryptocurrencies, and common mistakes made by beginners in detail.

What is Cryptocurrency?

(Cryptocurrency) is a digital asset based on cryptographic technology. Unlike traditional currencies controlled by central banks, cryptocurrencies operate on a decentralized network technology called blockchain.

The first developed cryptocurrency was Bitcoin, created in 2009 by an individual or group known as Satoshi Nakamoto. Besides Bitcoin, there are thousands of altcoins(cryptocurrencies other than Bitcoin).

Cryptocurrencies are gradually increasing their status as both a means of payment and an investment asset.

Attractive Points of Cryptocurrency Investment

High Profit Potential

Cryptocurrencies are highly volatile, but with smart trading strategies, significant profits can be expected. For example, Bitcoin, which was around $900 in early 2017, reached $86,840 as of December 2024, recording an enormous return.

Low Entry Barriers

Since cryptocurrencies can be traded in fractional units, you can start investing with small funds. Most exchanges have a minimum trading amount of about $10.

24/7 Trading

The cryptocurrency market operates without time and location restrictions. It offers the flexibility to trade anytime and anywhere.

Transparency through Decentralization

Thanks to blockchain technology, transaction records are transparently recorded, and direct transactions without intermediaries are possible, reducing transaction costs. The risk of manipulation is also very low.

Understanding Cryptocurrency Trading Methods

Centralized Exchanges

Centralized exchanges are platforms operated by specific companies, holding many users and high trading volumes.

Advantages:

• Rich liquidity allows for quick trade execution
• User-friendly interface and customer support
• Easy for beginners to use

Disadvantages:

• Assets are stored on central servers, posing hacking risks
• Must comply with government regulations, requiring complex identity verification procedures

Recommended for: Beginners prioritizing ease of use and traders who trade frequently

Decentralized Exchanges

Platforms where smart contract technology enables automatic trading execution.

Advantages:

• Directly manage assets in personal wallets, ensuring control
• Relatively lower hacking risks
• Enable anonymous trading, protecting personal information

Disadvantages:

• Lower liquidity may result in slower trading
• Complex interface makes it difficult for beginners
• Requires understanding of smart contracts and private keys

Recommended for: Experienced investors prioritizing security

CFD Trading Platforms

CFD( Contracts for Difference) are derivative trading methods that allow profit from price fluctuations of underlying assets like cryptocurrencies without owning the actual asset.

Advantages:

• Leverage allows managing large positions with small capital. For example, using 10x leverage, $1,000 can control a $10,000 position
• Profit from both rising and falling markets
• No expiration date; as long as the required margin is maintained, positions can be held for desired periods

Disadvantages:

• Losses can exceed initial investments due to leverage
• Risk management, such as setting stop-loss orders, is essential
• Requires thorough understanding of CFD mechanisms

Recommended for: Traders who understand CFDs, accept risks, and seek high returns

Promising Cryptocurrencies for Investment in 2025

1. Bitcoin(Bitcoin)

Bitcoin is the flagship digital asset, with continuous inflows of institutional funds through spot ETFs. Its limited supply(21 million units) and widespread adoption make it a highly valued investment asset.

Currently, Bitcoin is priced at $86,840, and experts mention the possibility of reaching $100,000 by mid-2025. There are also analyses suggesting that if government-level strategic assetization proceeds, it could rise as high as $250,000.

2. Ethereum(Ethereum)

Ethereum is a platform that goes beyond simple cryptocurrencies, enabling the development of decentralized applications and smart contracts. It is used in various fields such as DeFi and NFTs.

The current price is around $2,910, and if final approval for spot ETFs is granted, an inflow of approximately $15 billion to $45 billion is expected. Some analysts suggest it could rise to $8,000 by the end of the year.

Ethereum is expected to continue strengthening its position as an essential platform for smart contract developers.

3. Solana(Solana)

Solana is characterized by fast processing speeds and low fees, making it a strong competitor to Ethereum. Although it faced difficulties at one point in 2022, it recovered after forming key partnerships. As of March 2024, it ranked 4th in cryptocurrency market capitalization.

The current price is $122.08, and it is considered a candidate for approval of spot ETFs. Some analysts predict the price could rise to $200.

4. Cardano(ADA)

Cardano, created in 2015 by co-founders of Ethereum, currently has a circulating value of about $31.4 billion.

The current price is $0.35, and recent strategic assetization movements have drawn attention. If it breaks through the resistance at $1.20, there is potential for it to rise to $16.

5. Binance Coin(BNB)

Binance Coin offers various benefits within the ecosystem of major exchanges, such as trading fee discounts.

The current price is $839, and there are forecasts that, with regulatory stabilization, it could rise to $630 by 2026 and $760 by 2030. As the platform grows, the coin’s utility is also expected to increase continuously.

Common Trading Mistakes Beginners Should Avoid

Excessive Trading Frequency

Frequent trading increases fees and harms profitability. It’s important not to be swayed by short-term volatility and to avoid impulsive decisions.

Underestimating Market Risks

Ignoring the complexities and risks of the cryptocurrency market can lead to significant losses. Always check the latest information and conduct thorough research before making investment decisions.

Neglecting Stop-Loss and Take-Profit Orders

Not setting stop-loss orders leaves you unable to respond to unfavorable market movements. It’s essential to predefine levels to limit losses and secure profits.

Buying at High Points and Selling at Low Points

Emotional trading leads to buying at the worst times and selling at the best, resulting in losses. Patience and careful judgment are necessary.

Conclusion

The cryptocurrency investment market is a dynamic environment capable of delivering both dramatic profits and losses. Understanding blockchain technology and the fundamentals of the cryptocurrency market is essential for successful investing.

While considering expert price forecasts, making cautious investment decisions can reduce mistakes and minimize losses. Use this guide as a starting point to include cryptocurrencies in your portfolio and develop systematic trading strategies.