Best Practices For Beginner Crypto Traders

The biggest beginner pitfalls are usually about process, not the market. People buy using the wrong order type, don’t realize spreads are part of the cost, or fund too much too early before they’re comfortable. A good beginner app helps prevent those mistakes by making the buying flow simple and the pricing transparent enough to understand at a glance.

Tips for Beginner Crypto Traders

The following tips are best practices if you’re new to the world of crypto.

Start small and treat your first trades as practice.

The goal in your first few trades isn’t to make a profit. Rather, it’s to learn how the app works, how orders behave, and how you feel when prices move. Starting with small amounts helps you build confidence without the pressure of meaningful losses.

Use limit orders once you understand them. Market orders can surprise you.

Market orders fill immediately at the best available price, which can be higher or lower than expected during fast moves. Limit orders take a bit more learning but give you control over your entry price, which is often safer for beginners.

Learn how fees and spreads work before trading frequently.

Crypto apps make money in different ways: some charge explicit trading fees, others add a spread to the price. Even small costs add up if you trade often, so take a few minutes to understand where you’re paying.

Turn on two‑factor authentication and secure your account on day one.

This is one of the most important steps you can take. Two‑factor authentication adds a layer of security that protects you even if your password is compromised.

Don’t store all funds on an exchange long‑term unless you understand custody

Most crypto apps are custodial, meaning they hold assets on your behalf. That’s convenient, but it means you’re trusting the platform. For longer‑term holdings, many users eventually learn about self‑custody options. However, self-custody is likely not something you should consider as a beginner as it can involve more complexity and technical understanding.

Avoid chasing hype. Focus on assets you can explain in one sentence.

If you can’t explain why a coin exists or what it does, that’s a red flag. Hype tends to fade quickly, and beginners often lose money chasing fast moves.

Keep a simple trading journal.

Write down why you made a trade, your expected outcome, and how it played out. Over time, this builds awareness of patterns — what works for you and what doesn’t. By the way, this can be a great method for any form of trading, including stocks.

Don’t trade money you can’t afford to lose.

Crypto is volatile. Prices can move quickly in either direction, and even established assets can have sharp swings. Only use money that won’t impact your day‑to‑day life if it drops.

Expect volatility and decide your reaction in advance.

Large price moves are normal in crypto. Decide ahead of time how you’ll respond. For example, whether you’ll hold, take partial profits, or step away, so you’re not making emotional decisions in the moment. Often times, investors and traders do the opposite that they planned to do. Thus is market psychology. Journal about whether or not you followed through with your original plan. Reflect on why or why not.

Use one reputable app at first instead of jumping between platforms.

It’s easier to learn one interface well than to bounce between multiple apps with different fee structures and workflows. Once you’re comfortable, you can explore alternatives.

Learn the tax basics early.

In many regions, crypto trades are taxable events. You don’t need to become an expert right away, but it’s important to know that buying, selling, and converting crypto can create tax reporting obligations.

Be skeptical of “guaranteed returns” and too‑good‑to‑be‑true promotions.

If an offer sounds guaranteed or risk‑free, it usually isn’t. Scams and misleading promotions are common in crypto, and beginners are often targeted. Slow, steady learning beats any “shortcut.”

Personal Advice from Kevin

Now that we’ve covered some best practices, let’s talk some more pieces of advice from over 15 years of being involved in Bitcoin and cryptocurrency.

Don’t just be a trader.

I can’t tell you how many people I’ve known that have been super into trading crypto for a season (usually a season where crypto is going up and up), and then they lose interest and completely stop (usually after losing money). If you have a set amout of money you plan to deposit into a crypto app, split it in half as follows: 1) Take the first half and buy some Bitcoin and don’t ever touch it. 2) Take the second half and do some crypto trading. Have the discipline to not touch the Bitcoin that you purchased and be a holder of Bitcoin. You will learn quite a bit by being a long-term holder.

Be honest about what you’re doing.

When you buy a random crypto coin, why? Did you buy it because you saw someone recommend it on X? Did you buy it because it’s got a lot of momentum? Understand the why behind your trade and document it. Successful trading over time is just as much about knowing yourself as it is about knowing the market. Be honest and reflective.