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How to Invest in Crypto For Beginners 2024 [FREE COURSE]

Charlie Chang2023-12-10
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86K views|7 months ago
💫 Short Summary

The video provides a comprehensive guide on investing in cryptocurrencies for beginners, covering topics such as what cryptocurrency is, types of cryptocurrencies, wallets, mining, popular coins, due diligence, and valuation metrics. It emphasizes the importance of research, understanding blockchain technology, and considering risks before investing. The speaker recommends platforms like Coinbase and highlights the benefits of Zero Trading. Tips on diversifying investments, tax implications, and long-term strategies are also discussed, urging caution due to market volatility and the presence of scams in the crypto space.

✨ Highlights
📊 Transcript
Beginner's guide to investing in cryptocurrencies.
02:08
Covers topics including types of cryptocurrencies, considerations before investing, buying crypto through Coinbase, and avoiding scams.
Emphasizes the importance of due diligence and offers tips and tricks for successful investing.
Discusses popular crypto coins, tokens, ICOs, and resources for learning more about cryptocurrency.
The instructor, Charlie Chang, shares his experience and insights on building a successful crypto portfolio.
Overview of Cryptocurrency and Blockchain Technology
02:54
Cryptocurrency utilizes cryptography to enable decentralized transactions without intermediaries.
The blockchain is a secure and transparent ledger that records transactions across a network.
Unlike centralized ledgers controlled by institutions, the blockchain is shared among participants for transparency and prevention of manipulation.
Multiple copies of the blockchain are stored on different machines to ensure validity.
Overview of Cryptocurrency Mining
04:55
Cryptocurrency mining validates transactions and adds them to the blockchain through two main methods: proof of work and proof of stake.
Proof of work requires miners to solve complex math problems to earn crypto rewards.
Proof of stake rewards miners for holding and staking cryptocurrencies instead of solving math problems.
Mining at home is possible but comes with risks such as high electricity usage, price volatility, hardware costs, and security vulnerabilities.
Highlights of Cryptocurrency Mining and Investment.
07:37
Cryptocurrency mining may not be worth it due to high equipment costs and slow rewards.
The top 10 cryptocurrencies by market cap include Bitcoin, Ethereum, and USDT.
Investing in established cryptocurrencies is recommended over risky projects.
Factors to consider before investing include supply and demand, scarcity, and sentiment.
Factors influencing cryptocurrency value include adoption, utility, and technology like Ethereum and Solana.
09:32
Increased usage leads to higher demand and prices for cryptocurrencies.
Risks of investing in cryptocurrencies include security vulnerabilities, fraud, environmental impact, lack of liquidity, volatility, and regulatory uncertainties.
Despite potential gains, there is a high risk of losses associated with crypto investments.
Importance of cryptocurrency wallets in storing digital coins and executing transactions.
11:50
Wallets contain public and private keys similar to a bank account, crucial for true ownership of cryptocurrencies.
Hardware wallets like Ledger and Trezor offer offline storage and increased security but are less convenient.
Web wallets are hosted by third-party services, convenient but less secure.
Software wallets are programs storing crypto on computers or mobile devices, offering advanced features and convenience but more vulnerable to malware attacks.
Guide on investing in cryptocurrency.
13:59
Platforms like Coinbase, Gemini, and Binance function similarly to standard brokerage accounts, with taxation on capital gains.
Coinbase is recommended for beginners due to its user-friendly interface and security features.
A step-by-step walkthrough on using Coinbase is provided, along with an offer of up to $200 for free sign-ups.
Features of the Coinbase app include buying, sending, and receiving crypto, news articles, and a watch list of cryptocurrencies.
Benefits of using Zero Trading for learning and watching videos.
16:25
One-month free trading fees offer and earning rewards by completing tasks.
Speaker shares personal portfolio valuation growth on Coinbase from $188,000 to over $223,000 in a month.
Demonstration of buying crypto on Coinbase, including browsing categories, checking top assets, and buying Bitcoin.
Process involves selecting amount to buy in USD or Bitcoin, connecting a bank account, reviewing order details, and placing the order.
Importance of Due Diligence in Cryptocurrency Investments.
19:40
Conducting due diligence is essential before investing in cryptocurrencies to mitigate risks.
Investigating the business or asset helps in understanding where the money is being invested, preventing potential loss.
Fundamental and valuation metrics, along with qualitative indicators, can aid in making informed decisions.
Market capitalization is a crucial metric to consider when evaluating investments in the cryptocurrency space.
Valuation metrics for cryptocurrencies.
21:55
Market cap is calculated by multiplying total coin supply by the latest trading price.
NVT ratio is calculated by dividing market cap by daily transaction volume.
Circulating supply and total supply are important for assessing potential value appreciation.
Market dominance indicates a coin's relative size in the cryptocurrency market.
Key Considerations When Evaluating Websites and Cryptocurrency Investments.
22:59
Evaluate the credibility of website creators, technical background, and trustworthiness.
Look into factors like project code on GitHub, addressable market, utility, and regulatory environment when investing in cryptocurrency.
Assess the technology's potential to solve real-world problems and associated regulatory risks.
Conduct thorough research due to varying global regulatory landscapes for cryptocurrencies.
The segment highlights using a website for researching and analyzing cryptocurrencies, with a focus on Ethereum.
25:16
The website offers various information on Ethereum, including market cap, trading volume, supply details, official links, price charts, and historical price movements.
It warns about the volatility of cryptocurrency investments and advises caution to investors.
The segment briefly mentions analytics, whale holdings, and other cryptocurrencies in addition to Ethereum.
Overall, the website is recommended as a valuable resource for cryptocurrency enthusiasts.
Importance of Due Diligence in Cryptocurrency Investments
27:44
Due diligence before investing in cryptocurrencies is crucial and involves understanding white papers.
White papers provide technical information on project goals, technology, incentives, emission plan, and conclusion.
Structure of white papers usually includes an abstract, introduction, technical details, and references.
Focus on top projects and use summaries for essential information if white papers are too lengthy or technical.
Overview of Tokens and Initial Coin Offerings (ICOs).
30:08
Tokens are units of value issued by crypto startups representing pieces of a crypto network, separate from coins.
They can be sold for Fiat or cryptocurrency to raise money and are issued by platforms like Ethereum, Waves, EOS.
Utility tokens provide access to services or platforms, while security tokens represent ownership stakes.
ICOs are fundraising methods where new crypto projects sell tokens to investors, but they are risky due to potential failures or fraudulence in an unregulated sector.
Risks associated with investing in cryptocurrency highlighted in the Luna crash.
32:19
Volatility and unpredictability of cryptocurrency markets emphasized, caution and due diligence important.
Warning about algorithmic stable coins and potential for catastrophic meltdowns, even in well-backed projects like Luna.
Mention of rug pulls, where developers manipulate token value to deceive investors.
Overall message to be aware of risks in crypto market, stay informed to avoid losses.
Risks of malicious features in token smart contracts.
34:21
Developers can use malicious features to commit fraud by stealing liquidity or dumping tokens on investors.
Importance of conducting thorough research before investing and avoiding projects with high returns and low risks.
Cautions against projects with locked liquidity and recommends reputable cryptocurrency exchanges and index funds for safer investments.
Tax implications of making profits with cryptocurrencies, subject to ordinary income and capital gains tax.
Differences between long-term and short-term capital gains tax incentivize holding onto assets for over a year.
36:51
Wealthy individuals use loans against portfolios to access money without selling assets.
Personal finance decisions on crypto investment vary, with recommendations ranging from 1 to 10% of net worth.
It is advised to invest money not needed for long-term living expenses to mitigate risk.
Research on crypto and risk tolerance influence investment decisions.
Diversifying Investment Options Beyond Cryptocurrency.
39:10
The importance of considering individual financial situations, risk tolerance, and investment goals when exploring investment options.
Starting with a small investment in cryptocurrency while being mindful of its volatility.
Taking action by opening a crypto investing account and conducting thorough research.
Emphasizing the evolving nature of the market and the necessity for continuous learning, as well as diversifying investments across various assets like stocks, real estate, and self/business ventures.
Importance of diversifying investments for a well-balanced portfolio.
41:11
Encourages viewers to share the video with friends interested in crypto investing.
Wishes viewers luck on their investing journey and promises exciting times ahead.
Promotes hitting the like button, subscribing for more content, and mentions focus on personal finance, investing, and entrepreneurship.
Ends with a message of gratitude and a farewell.