This article is written from someone who has direct experience with cryptocurrency. I have made some money and lost a reasonable amount of money due to a stupid mistake. If you want to learn how to make money with cryptocurrency then you’ve truly found the right article. I’m here to give you an overview of the crypto market so you can avoid the mistakes I made and give yourself greater odds of beating the crypto game.
How to Make Money with Cryptocurrency
The term “cryptocurrency” can mean a lot of things to different people. There are a variety of ways to make money such as the most common way of investing in the crypto coin buy buying on a crypto exchange, like Kucoin or a DEX (decentralized exchange) like UniSwap.
You can make money investing in NFTs but this has a lot of nuance to it. I’m personally a fan of investing in virtual land or gaming NFT’s, like in The Sandbox and GALA Games. These are two of my favorites in crypto game companies and projects. There’s so much garbage in crypto gaming so if you don’t know games then educate yourself or stay away. I understand the gaming market so I can spot the good projects. Start with these two if you want a starting point.
You can make money staking your crypto and earning yield. This is another area that will seem overwhelming at first that carries high risk. Don’t be fooled of guarantee’s of high returns. If it seems too good to be true it probably is.
Learn how to use a good crypto wallet like MetaMask. It’s confusing at first. Play with small amounts of crypto until you learn how it all works. It’s easy to lose money in crypto because the technology is so early and there’s no protection to users. Who do you call if you lose your crypto? Usually nobody.
And when you get to the point when you’re investing a lot of money in the cryptocurrency market, get yourself a quality wallet to store, like the ones below. I own the Nano X and I personally like it.
I’m not going to lie to you, crypto is a fairly complicated world that you need to prepare for. I need you to understand this one point if nothing else, prepare for making money in crypto as you’d prepare for a marathon. You wouldn’t try to run a marathon this weekend if you’ve never run before so heed the same logic with cryptocurrency. I’d recommend about 600 hours of research and study in crypto before you decide to invest, but that’s my perspective. I did the work so this advice is not coming from thin air.
Beware of YouTube Personalities
One of the biggest errors that newcomers make in crypto is thinking that it’s easy to make money, but nothing can be further from the truth. If you go in blind, you will likely lose your money but I’m here to coach you so you have your eyes wide open. I’m here to give you a good chance to make money at crypto. I’ve learned the hard way but you don’t have to.
There’s no shortage of people on youTube, TV or the internet who talk about how they made millions with crypto. I’ve seen all of the youTube personalities that have nothing but great things to say about crypto. In fact, following these voices will be your first mistake, as I did. You need to educate yourself and find the few voices you can trust, the people who aren’t trying to sell you something.
I’m annoyed know at all of the youTube channels that try to convince of the next great crypto that can’t lose. It seems as if it’s impossible to lose money with crypto, but that’s because most of the youTube personalities are trying to sell you something. Either hope, because hope keeps people watching and coming back the next day. Would you want to follow someone if they told you it was hard to make money in crypto? Think about it. And the other thing they might be selling is the very crypto’s they are promoting. Truth is, a lot of youTube personalities are paid to promote crypto and there’s no law for them to disclose they are promoting crypto. They are getting paid between $1K to $10K to create a video to promote their new crypto product and you, the viewer has no idea that you’re watching a commercial.
One day regulation will make it illegal for people to get away with not disclosing their paid commercials on youTube but for now it’s up to you to understand this is happening. Now you know. Don’t say I didn’t tell you.
Right now, I’m telling you what to avoid. You know you’re ready to invest in crypto when you know enough that you can selectively choose cryptocurrencies to buy and you know why you’re buying them. This is the key — you must have enough insight to know why the crypto you’re about to buy is worth buying. Never buy crypto because someone told you to but you don’t have a clue about what you’re buying. Never. No exceptions. Knowledge is everything. Trust nobody in crypto, not even me. I’m talking from my own experience, but it’s a common story.
Learn the Crypto Cycle
There have been times in the cryptocurrency market when whatever you bought went up and if you bought in at these times you would have made money. Most people who have made a lot of money with crypto got lucky. Yes, it’s true. If you buy in at the right time and the market went up you simply got lucky. You’re not a genius. Anybody can get lucky once in while. And so many crypto millionaires talk about the market as if it were still 2017, 2020 or 2021. It’s now 2022 and the world is different. We’re still in a pandemic and there’s a war in the Ukraine, not to mention governments threatening crypto regulation. The world is changing fast and it’s up to you to know where we are in the cycle.
Are we in a bull market or a bear market? Right now (March 2022), crypto is in a bear market. Last summer it was a bull market. If you’re not familiar with the terms, a bull market means the market is going up and a bear market means the market is trending downwards. An easy way to visualize this is : The bull is going up the stairs as the bear goes down the stairs. I kept getting confused as to which animal meant what in the beginning, I found this mnemonic helpful. You’re welcome!
Up until recently, you’d hear a lot about the 4 year BTC cycle but up until last year, this is not longer a valid thesis. You can’t predict the crypto cycle and it won’t follow the calendar the way experts want you to believe, but the market will ebb and flow depending on what’s happening in the world. You need to follow the market carefully, read the news stories, do deep research, and this will bring you in tune with where the market is at.
A lot of money is made in the bear market because all crypto is usually quite cheap. Investing money in the right place will pay off in a bull market, but it all comes down to choosing where you put your money, which I’ll address soon.
Did you See Dogecoin coming?
In 2014 I bought 10,000 Dogecoin for under $100 on Ebay just in case it went up one day. The cost was small, I had witnessed what Bitcoin had done at the time and I decided I had nothing to lose. I kept it in wallet and in 2021 I had learned it went up to be worth about $7K. I eventually sold it for about $3.5K. Was I a genius? If I had known I would have bought a million Dogecoin, but I had no clue. If I was really smart I would have bought Bitcoin instead of Dogecoin. I kick myself every day for all of the opportunities I’ve missed in my life, and I’ve missed a lot, but all I can do is learn from my mistakes
The more I write about making money with cryptocurrency, the more I realize I should be writing a book. There are so many facets of the market that it’s challenging to cover them in detail in an article. This might be a very long article. There’s so much more to say.
Know your Crypto
Research is everything. It took me about 3 months of 12 – 18 hours of daily research before I felt like I had some idea of the market. Yes, it will take much longer than you think to understand the market. You need to get a lay of the land first and that requires a lot of reading and research. In fact, this is exhausting. And, in the beginning you don’t have the knowledge to differentiate a quality crypto from a junk crypto. It takes time.
Some great resources :
There’s a lot of money to be made in the crypto market but luck is not a strategy. If you understand the market you can make money in the short-term but that comes with time and experience. Crypto often goes up with good news, so when a certain project has a news announcement their coin goes up. If you buy early you have a chance to make money, but this isn’t always true. If you wonder why crypto’s go up seemingly random, it’s not. There’s usually some good news (or rumor) behind the uptick in the market.
Invest in crypto companies/projects that have real world value. Meme coins are a matter of luck and will likely get you rekt, as they say. If you don’t understand the nature of the value the crypto is proposing then don’t invest. A lot of crypo coins sound like gibberish and are written to sound that way, to confuse you. Or, it just means you don’t understand the technical aspects of the technology and how it fits into the blockchain.
Research and read about what blockchain is and how it functions. Do this first so everything else will make more sense to you.
Be An Expert / Find Your Niche
You can’t be an expert in all areas of cryptocurrency. It’s impossible. It’s a vast landscape that’s being re-imagined every day. As in all aspects of life, find your lane and become an expert in that because the way to make money in cryptocurrency is by being being a master in an area of the market. You need to ensure you have deep knowledge in a narrow aspect, like gaming or DeFi. For example, if you’re interested in video games then study the game market but within games you may want to specialize in virtual real estate or gaming NFT’s. Even gaming is a massive market when it comes to cryptocurrency. Over time it will make sense to you so don’t force it.
Many people just invest in Bitcoin and Ethereum like Raoul Pal. Some people stick tightly to Layer 1 projects like Solana, Ethereum and Fantom.
I think choosing an aspect of crypto that you’re naturally interested in and going deep will earn you the best chance of making money over the long-term. Trust me on this one.
Video | Worth Watching : You’ll Learn A Lot
Learn Technical Analysis
When I first started on my crypto road I had no intention of teaching myself technical analysis (also known as “TA”), but it didn’t take long for me to recognize that it would be an essential skill to have. Technical analysis allows you to make sense of the crypto charts and the various indicators. For example, is a crypto overbought or oversold? Is a crypto’s traffic increasing or decreasing? You can analyze data from seconds to days to weeks and years. But without a grasp of TA you’re lost and at the mercy of everyone else telling you “BTC is oversold, now might be a good time to buy.”
TA won’t predict the future. It won’t guarantee anything but it’s valuable data that should inform your investing decisions, especially if you intend to do any short-term trading (hours, minutes, days). TA will be able to inform whether you should buy right now or wait a little longer. It’s valuable informing your entrance and exit points, but it’s not a science and don’t believe anyone who treats it like one. More information is useful.
If you’re more interested in long-term investing then I’d say that TA is less useful and not necessary. But, for short-term it’s not optional. Just start learning, it only takes a few weeks for it to start helping you. Who knows, maybe one day you’ll be a crypto trader. Personally, I highly recommend Eric Krown Crypto’s YouTube channel. He’s a master at his craft and won’t sell you hyperbole. In fact, he often makes fun of the whole crypto market, and for good reason. Start with him, and Trading View is the best software for TA.
VIDEO | Eric Krown Crypto