Recently, I’ve noticed that many people want to enter the cryptocurrency world, but truly knowledgeable ones are quite few. I often get asked various basic questions by beginners, so today I’ll systematically talk about the essentials of getting started in the crypto space.

First, let’s talk about what trading coins is. It’s actually very simple, just buying low and selling high to profit from the price difference, similar to stock or real estate trading. The difference is that digital currency trading is more free, operates 24/7 without limits on price fluctuations, which leads to relatively larger profit potential. Some people have made huge gains by buying coins at a few dollars and selling at thousands, which is also why more and more people are paying attention to the crypto world.

To trade coins, you first need a place to do so, which is the role of exchanges. An exchange is like a stock market, a platform for trading digital currencies. Currently, major large exchanges have high security, and using top-ranked platforms significantly reduces risk. Some small coins may only be listed on specific exchanges, so you need to go to those smaller platforms.

Next is USDT, the most commonly used intermediary currency in the crypto space, also called a stablecoin. Simply put, it’s like digital US dollars, with 1 USDT = 1 USD, issued by Tether. The process to buy coins is: first exchange RMB for USDT, then use USDT to buy the digital currency you want. Selling coins is the reverse: convert coins into USDT, then exchange USDT back to RMB. This process is called coin-to-coin trading.

Getting started in the crypto space requires mastering some basic terminology. Full position means investing all your money into coins; reducing position means selling part of your holdings; closing position means selling everything. Stop profit and stop loss are especially important—they help lock in gains or cut losses. Bull market means prices are rising, bear market means prices are falling; going long is buying with a bullish outlook, going short is selling with a bearish outlook. Opening a position involves buying coins, adding to a position is called averaging down. Cutting losses means selling at a loss, being trapped refers to buying in and the price moving against you, and breaking even or turning a profit later is called recovering from a loss. Missing out refers to selling and then the coin’s price soaring, causing you to miss profit opportunities.

Regarding mainstream coins, Bitcoin is the leader, Ethereum is second; these two are widely recognized as the most mainstream. Some consider the top ten coins by market cap on exchanges as mainstream. Generally, coins with higher market cap are more recognized, have better liquidity, and lower investment risk. Conversely, smaller coins ranked lower tend to have lower recognition, poorer liquidity, and higher risk.

When it comes to risk, I must emphasize this. Ethereum’s creator, Vitalik Buterin, once said a very honest remark: “Never invest money you cannot afford to lose.” I strongly agree with this. The crypto space is risky—never borrow money, take out loans, or use credit cards to play. Especially with contract trading, which is extremely risky.

Coin-to-coin trading only makes money when prices go up. If you want to profit in a falling market, you need to do contract trading. Contracts are futures trading—you can pay a certain margin to borrow coins, go long if you expect prices to rise, go short if you expect prices to fall, or even open both positions simultaneously. For example, if you think BTC will fall, you only need to pay 1% margin to borrow 100 times the coins; every $1 drop in price means a 100-fold profit. Sounds tempting, right? But I must say this three times: beginners, do not play with contracts! This path may seem like a quick way to get rich, but in reality, it’s even faster to get liquidated or go bankrupt.

Getting started in crypto also requires three things. First, an Android phone to easily install various apps. Second, spare money—funds that are not urgently needed and losing them won’t affect your life. Third, the right mindset—those who are anxious or overly emotional are really not suitable for crypto trading. There are many ways to make money in the crypto space; you don’t have to trade coins specifically. Returns are always proportional to input, so I hope everyone can find a rhythm that suits them.