Cryptocurrency Types simplified

22 min readMar 11, 2022

Here is the deal : You will never become rich and successful by doing hard work, you only have a chance by doing smart work. Why would you build a House and enrich the Owner of the company building Houses instead of Investing in that Company and let others do the hard labor while you can go to sleep and still make money ? It is not a complicated concept, yet many people refuse to learn to do it. Sure the concept might not be complicated, what is is the execution. Investing comes with a risk, but offers a huge reward in return. You could give your money to somebody who does this for a living, thus minimizing the Risk but also the Reward. Or you could put some time, that you otherwise would have wasted, into it and learn to do it yourself.

Today it is extremely easy to Invest in Stocks. There are millions of Guides, Books and Websites that reduce the Process to a couple of Clicks. The hardest part is to decide which Stock to buy. But before going into that, what other Options are there to make your money work ?

Bank Savings Accounts ( in pretty much any Bank anywhere in the World ) or any other form of saving barely ever covers the rise of Inflation. Putting your money in a Bank Savings Account is almost the same as putting it under your mattress.

Investing in Assets that are considered a Store of Value, like Gold, is a good way to NOT LOOSE value. Your Capital will not loose value but you also wont add much to it either. There is almost no risk in it and it is better then a Bank Savings Account.

Investing in Stocks can be thought of in a simple way : you either Invest in a Stock, or an Index Fund. You will make more money by Investing in an Index Fund than with Gold and you will make significantly more money by Investing in the individual Stock. The risk is of course higher, but so is the reward.

So if you know what you are doing, you can reduce the risk of Investing in Stocks to a very low amount, yet keep the high Rewards. This however requires a lot of time, experience and commitment. You need to consume a lot of Information and do it on a daily basis. The more experience you have, the less time it is needed to spend on it everyday. But even if you commit to learning Investing in Stocks and spend Time on it everyday you will still be playing a Game which is constantly changing, and you don’t have full access to the Rules of the Game.

Just think about it. Do you honestly think that by Reading a couple of Guides or outdated Books about Investing you will have access to the same Tools and Information as the People who Invest for a living ? Insider Trading and many other forms of Market Manipulation put you in a huge disadvantage. Limited Access to certain Information, Statistics, Data or Research simply make it an unfair Game for you to play. The people who created one of the biggest Financial Crises in the world are still in charge of the Game and are the ones who will do everything to make sure they make the most money. So why bother trying to fight something that is so incalculably gigantic ? Some people tried and failed, yet still think that they have a chance. Why play a corrupted game when you can simply play another Game thus accomplishing two things at once. You help fighting those in control of the corrupted Game even more while also making significantly more money at a lower cost of effort. What else is there ?

Enter Cryptocurrencies

( I will skip many things that I already covered in my other Posts, so I suggest you reading those first )

There are plenty of places where you can learn the very Basics of Cryptocurrencies. You can assume some things in my previous posts already likely contain outdated Information, because of how fast this Industry is evolving. So I suggest you to visit places with free up to date Information like Coinbase Learn, Binance Learn or Decrypt Learn. These are just ones that came to my mind right away, but there are plenty more that might even be better ( even Wikipedia has a ton of Information ). The point is : Access to Information about basics of Cryptocurrency is free and available to everyone in the world. If you come from the world of Stocks, then my previous Posts have many links to Research about Cryptocurrency that you should definitely check out first before going further.

Assuming that you know the basics and you want to Invest in Cryptocurrencies, how can you possibly know what to choose ?

Beginning from the Top :

Bitcoin or no Bitcoin ?

Like already mentioned in previous Posts, Bitcoin is considered a Digital Store of Value that is superior to Gold in almost every way. Many People have already heard about it by now and Countries are even starting to recognize it as legal tender. Besides faith in it and the fact that people give it value, just like Gold, it has no value on its own. You cannot do much with it other then send it from one wallet to another. I will try to be brief here without going into much discussion and detail on what and why since I already did it before. The only thing to take from this is that the General Consensus is : Bitcoin is a Store of Value.

Now let’t get into the Various Categories that exist : ( Blockchain Platform aka Chain )

  • Layer 1 Chains
  • Layer 2 Chains
  • Layer 0 Chains
  • Currencies
  • Meme / Hype Coins
  • Centralized Stablecoins
  • Decentralized Stablecoins
  • Defi dApp Tokens
  • DAO Tokens
  • Synthetics / Wrapped Tokens
  • CEX Coins / Tokens

You can find some of these Categories and more on under Categories.

Layer 1 Chains

A Layer 1 Blockchain is a Blockchain that supports Smart Contracts. Read more here.

A Blockchain Platform can be Established in the DeFi Industry or Emerging. Established in DeFi means that it already has at least DeFi 2.0 or higher. Emerging means that it has a DeFi level of 0 or 1 and projects are being built on it. In this case DeFi focused dApps.

DeFi 1.0 means a Chain has at least one DEX dApp( Decentralized Exchange ).

DeFi 2.0 means that a Chain has DEX, Lending ( Decentralized Lending of course ) and Synthetics ( a Synthetic is a cryptocurrency that follows the price of a certain asset ) Platforms, preferably including a Wrapped version of itself ( a Wrapped token of the Chain’s coin ). Also it needs to have support for at least one Stablecoin, preferably a Decentralized Algorithmic Stablecoin.

DeFi 3.0 means that a chain has all of the above plus things like Decentralized Yield Aggregators / Optimizer, Decentralized Insurance, Decentralized Reserve Currencies and many other.

Emerging in DeFi means that it has potential to grow. Here you need to make a decision whether you want to Invest in a Platform where DeFi is already established or you want a higher Risk but also higher reward by Investing into a Platform where DeFi is only emerging.

Once you Invest in a Cryptocurrency with at least DeFi 2.0, you can do a lot more then just stake it ( which is very recommended because the majority of Blockchain Platforms have inflation which only affects those who do not stake. Since by staking you help secure the Chain you are rewarded with passive income which is always higher then the protocol’s inflation ).

You could put your Capital into a DEX Liquidity Pool to earn from trading fees and or Liquidity Mining Programs on that DEX or other dApps. You could lend your Cryptocurrency or Stablecoin and borrow against it. You could use your Cryptocurrency as collateral for minting Synthetics or Liquidate others who are undercollaterized. And many more other things. There is plenty you could do, but the safest and easiest way of them all is to Stake. Staking not only brings you passive income, it can bring in the power of compound for certain Chains. Different Chains use different approaches to offer compounding, so you need to research those things for yourself. is a great way you can visualize and compare different APRs ( Annual Percentage Rate, i.e without compounding ).

TVL ( Total Value Locked ) can also help you decide which Chain has potential to grow. By comparing the TVL in DeFi of all the Chains you can have a rough Idea of how many dApps and which kind of dApps certain Chains have. There you can view how much TVL is locked in certain dApps and whether they are Audited.

Layer 2 Chains

Layer 2 Blockchain Platforms are complementary Platforms that aid a Layer 1 in regards to Scalability and may offer additional features. Currently ( at the time of writing this article ) the Ethereum Platform is congested and has Layer 2 Chains helping offload transactions. You can view all the Layer 2 Platforms in and their corresponding TVL. I won’t explain here why the Ethereum Chain is so congested that it requires additional Layer 2 complementary Chains. The only thing to know here is that these Chains have a lot of potential because they are all helping something that has grown too big. So by investing in them you are Investing into the future of the Layer 1 Chains that they support, which benefits both the Layer 1 and the Layer 2.

Another Layer 2 example is the Lighting Network for Bitcoin, which just like Ethereum’s Layer 2, helps with the congested Bitcoin Network.

You can read more about Layer 2 in Binance Academy and many other places to understand the significance, necessity and strengths of Layer 2 Platforms.

Layer 0 Chains ( Hubs / Zones )

The next generation of Chains. Layer 0 Chains ( also called Hubs ) are ones that focus on Interoperability and have a different approach to Scalability. These Chains can interconnect Layer 1s and 2s together along with all the dApps and protocols running on top of them. Different Layer 0 Chains use different approaches to how they work and what they offer. You can think of it this way : In a Layer 1 Blockchain you create two dApps, a DEX and a Lending Platform. Both of those dApps require the Main Chain ( the one on top of which they were created ) to function properly and use its Cryptocurrency coin for transaction fees. When something bad happens with the DEX, the Lending Platform will also be affected. If one dApp is spamming transactions and congesting the network, the other dApp will also be affected by it, because they all run on the same Layer 1 Chain.

What happens in Layer 0 is that instead of making a dApp on the main Chain, you create a whole new Chain, which you then interconnect either directly with other chains or use some sort of Hub ( the Main Layer 0 Chain through which others are interconnected ). In the Example, the DEX becomes its own Chain and the Lending Platform become their own Chain, yet they can communicate with each other. This way they do not affect each other negatively and have many other advantages such as Sovereignty ( in certain cases ).

Different Layer 0 Chains have different approaches. Some allow you to build on top of them only if you pay them a lot of money. This ensures that you are not a malicious actor and that you have good intents, it is however costly. Other Layer 0 Chains allow full sovereignty. You can create your own Chain completely for free and all the features are Modular. You can be in charge of everything, from Governance to having your own Consensus Mechanism. After that you can even connect other Layer 1 and thus Layer 2 Chains if they meet certain requirements.

There are currently not many Layer 0 Chains, but ones that exist are building the next Generation of Cryptocurrencies. If and how successful they will be remains to be seen. But you can think of it as a new Emerging Technology in the Cryptocurrency Industry. Chains built on top of a Layer 0 Hub can be thought of as complete Layer 1 Chains ( in certain cases ), that way the whole Ecosystem achieves higher Scalability while offering the same things that normal Layer 1 Chains offer and more, while still being sovereign and in complete control of everything. You can Invest in the Chains that are a part of the Layer 0 Ecosystem or in the Main Hub itself which offers many Services to the Chains that are connected to it thus bringing a unique Value Proposition. So just keep in mind that a Chain can be a Layer 1 that is part of a Layer 0 Ecosystem.

I suggest reading “A Comparison of Heterogeneous Blockchain Networks” by Burak Arikan.


These are Cryptocurrencies that are intended for value transfer, some of them are even completely private and anonymous. Since their focus is solely on Value Transfer they do not have Smart Contracts or any form of DeFi, and many do not even have staking. Any Layer x Chain Cryptocurrency coin / token can also be used for value transfer, it is however not intended for it and you might be loosing value on it due to inflation. Currencies do not offer staking nor have inflation ( in most cases ). It is difficult to think of them as a form of Investment because their value accrual is rather limited. However some of them are used in certain ecosystems and have that as their value accrual use case. You can still make profit off of buying and selling them, but you must decide for yourself if you see potential in them.

Meme / Hype Coins

Cryptocurrency coins with no use case other then Hype and speculation. It does not mean that you wont get rich by buying and selling them, you might. But you probably won’t. But if gambling is your thing, feel free to buy them. Almost of them also fall into the Category of Currencies ( yet most of them perform a very poor job in that aspect, compared to full on Currencies ), thus the only thing you can do with them is send from one wallet to another. Their only advantage over Currencies is that they have Hype ( which is a form of marketing ) Cycles.

Centralized Stablecoins

A stablecoin is a Cryptocurrency coin that follows the price of a real world non digital currency such as $ Dollar or € Euro etc. These stablecoins are backed by Centralized entities ( for example a CEX Centralized Exchange ) and their most of the time non Cryptocurrency related collateral. A centralized stablecoin can be backed 1:1 by real $ US Dollars or other assets such as Gold to maintain its peg. In summary when a Centralized Entity wants to create 1$ in a Cryptocurrency stablecoin, they must add 1$ US Dollar to their treasury as collateral. Different Centralized Entities back their stablecoins with different kinds of assets.

These will not go up in price so do not think about buying them and simply holding. By simply holding them you loose value due to real world inflation of the currency the stablecoin follows. You can however lend your stablecoin in a centralized or decentralized manner. If you lend your stablecoins to a CEX ( centralized exchange ) you can expect a much lower % APR ( no compounding ) than if you would lend your stablecoin to a decentralized Lending Protocol. By lending Centralized stablecoins you can expect a rate between 1%-5% APR ( means you get that % per Year ). You may find higher rates ( and even find Decentralized Lending that might offer APY, i.e Lending with Compound Interest ) but in general there is a lower demand for centralized stablecoins in the Cryptocurrency Industry. It is however MUCH HIGHER than any Bank would offer you, so think about it.

Decentralized Stablecoins

Mostly referred to Algorithmic Stablecoins. These usually are decentralized, as they have an algorithm to make sure that the peg ( they keep the price of the currency they are pegged to ) is kept, they have a DAO ( Decentralized Autonomous Organization ), which ensures that the holders of the DAO token ( which can be literally anyone ) can decide on changes to the protocol, and they are usually backed by various Cryptocurrency assets or even other stablecoins. The demand for these stablecoins is much higher in the DeFi world than with centralized stablecoins and they also have a way for you to directly invest in their success. You can lend these stablecoins in a centralized or decentralized manner. If you lend them in a centralized manner you can expect a range of 2%-10% APR. If you lend them in a decentralized manner you can expect anywhere from 2%-20% APY ( i.e with compounding ). Getting 20% APY on your Capital might sound strange, but it is not only safe it can even be insured ( using decentralized insurance of course ). You should also read and understand the incredible power of Compound Interest which is one of the Wonders of the World. Needless to say, lending your stablecoins in the Cryptocurrency world is much better than Lending it to banks.

Since Stablecoins are Cryptocurrencies, you can also use them in Liquidity Pools in a DEX, you can Lend them and use them as collateral to borrow more or you can use them as collateral to mint Synthetic Cryptocurrency Assets. You can also Invest in the Protocol’s token that is responsible for Governing the Stablecoin. Since there is no centralized authority, all the participants ( literally anybody ) are the ones minting ( creating the stablecoin ) and using their Cryptocurrencies as collateral. Thus the more TVL is locked inside the Algorithmic Stablecoin the more secure it becomes and the more value the Protocol’s token responsible for it accrues and goes up in price if the demand is high.

DeFi dApp Tokens ( Protocols )

If a dApp is created on a Layer 1 Blockchain ( or a side Chain on a Layer 0 ) it can be called a Protocol. This Protocol will eventually have a token which will be used to Govern it ( if it wants to be truly decentralized ). Anybody can buy that Token and Invest in that Protocol’s future and success and also vote in Governance and even create Governance Proposals. Like a share in a Company you and others who have the Token will be in charge of deciding what happens to the Protocol. The more value is locked into that dApp or the more activity it has ( depending on the dApp ) the more that Protocol’s Token becomes valuable. There are dApps for everything, from Finance to Insurance, from Gaming to Gambling and even Social Media Platforms. Some places where you can search for dApps are :, and There you can also find NFT Marketplaces and the Layer 1 Chains they are on. See Coingecko for the Category of dApps that fits you.

DAO Tokens

DAOs are programmable organisations of people. There are DAOs that govern something and there are ones that buy something and invest it. DAOs are collectives of people who want to do something together in a decentralized, completely transparent and fair way. They have a token that represents one’s ownership of the DAO which anybody can buy and then use it to vote for Governance proposals. A DAO can manage an Index Fund, and people who vote can choose what the Index includes. A Protocol can have a DAO to govern an algorithmic Stablecoin, which requires a lot of decisions and changes, since the stablecoin is decentralized so is the entity that controls it. There are even DAOs that act as a decentralized Reserve Currency that buy up Liquidity to give its token more value by locking it up inside the DAO controlled Protocol. You can search for DAOs on or These DAOs exist on Layer 1 / 2 Chains ( which can be within a Layer 0 Ecosystem ), and some of them have the goal of benefiting the Platform they are run on. So if a Chain has many DAOs it could be a sign of a healthy Ecosystem.


The term “synthetic asset” refers to a mix of assets that have the same value as another asset. A Synthetic is simply something of value but in form of a Cryptocurrency. As Example there is a Synthetic of Gold. This allows you as the holder of the Synthetic to participate in DeFi and use the value as collateral in many different Protocols across different Chains. Since more and more Chains are becoming interconnected through Bridges or Layer 0 Ecosystems, these Synthetics will be available to more Protocols and the best part ? You can send it almost instantaneously no matter where you are, it is available in the entire world ( as long as you have an internet connection ) and available 24/7 without any limits. Since you can make a Synthetic out of anything that has value, many Chains have Protocols solely focused on creating, collateralize and maintaining these Synthetics. These are all created in a decentralized manner where you as a User can create a Synthetic using another Cryptocurrency as collateral. Everything is open, transparent and requires no trust in a centralized authority. There are even Synthetics of Stocks, that way you can buy them and send them to somebody, or use them to earn Yield through different DeFi Protocols.

Wrapped Tokens are Synthetics of another Cryptocurrencies. There are many reasons why those were created and are necessary. One example is the Wrapped Bitcoin, which has always the same price as the real Bitcoin but is represented in form of an ERC-20 Token on the Ethereum Chain. Since Bitcoin is not able to communicate with Ethereum, wrapped tokens were created so that the Value of the Bitcoin can be used in DeFi for Yield, Collateral and many other things. Another Reason some Layer 1 Chains have a Wrapped token of their own Chain ( as example there is a wrapped Version of the Ethereum coin that is an ERC-20 token, thus it exists on the Ethereum Chain ).

There are many reasons for having a Wrapped token of a coin existing on its Chain, like being able to participate in DeFi and able to vote at the same time. ( since when you put your Cryptocurrency in DeFi you actually send them to a smart contract, you can’t use those coins at the moment they are inside of a smart contract, however some Chains and Protocols give you wrapped Versions of the Cryptocurrency Coins / Tokens as soon as you put them into smart contracts, this way you can use the Wrapped tokens to vote while your original Cryptocurrency coins / tokens are earning yield ).

Another reason is so that the Cryptocurrency you put in DeFi / Staking will accrue Yield with the compounding effect. There are Wrapped tokens of certain Protocols that continuously compound staking rewards and trading fees, are flash loan resistant and the original unwrapped tokens are then proportionally distributed to those who locked them according to the amount of their staked tokens and staking duration. Normally with staking you either lock or don’t lock ( in Liquid Forms of Proof of Stake your coins are not locked and can be moved at any time ) your coins / tokens and then withdraw your rewards to restake them again. Using the wrapping system the compounding is automatic and you do not need to interact with things as much, thus you save money on transaction fees.

So usually you should not buy Wrapped Coins because they follow the price of something you should buy instead, unless you are experienced and know what to do of course. ( instead of buying the wrapped version of the Ethereum coin, you should buy the Ethereum coin itself, it is just better and safer ). You can recognize Wrapped tokens when they have a prefix to them before the Coin they represent. For example aETH, bETH, xETH, aBTC, bBTC, xBTC etc. ( these are just examples, some of them don’t even exist, but its just to show you how to recognize them ).

CEX Coins

Centralized Exchange Tokens are coins / tokens issued by Centralized Cryptocurrency Exchanges. These are Companies that offer the Service of buying Cryptocurrencies with FIAT money. Some Cryptocurrency exchanges offer different perks like discounts, rewards and chargebacks. You can’t use them to vote on any Governance proposals since the Entities issuing them are centralized. But these Exchanges make a lot of money and these tokens represent their growth and have some form of value proposition. It is not the same as Investing in the Stock of a Company, but it is similar since the growth of the Exchange will mean a higher price for the Cryptocurrency coin / token. Some of them even offer staking which can be viewed as passive income similar to Dividends. Some Exchanges even have Launchpads ( places where new Projects can get funding ) on which you can participate with your CEX coins / tokens.

Breakdown of Top 50 by Mkt.Cap ( List from 02.01.2022 )

Now that you know some basics, it should help you decide in which Sector you want to Invest. Now you just need to know what is what. You can know if a Cryptocurrency falls under a certain Category by researching and reading about. That of course can take a lot of time. So here is some help :

Disclaimer : I do not know some of these Cryptocurrency Projects as it would take too much time to know all of them by heart and understand them. I obviously only know and understand those I Invest in. I will however try to correctly Categorize them with the Information available to me at the moment. Not only will the List itself change with time, so will some of the Projects. I will not correct the List if the Project changed the Category later on, as I want this to be something that can be used for comparison. However if you see a false Categorization at the Time I wrote this part of the article, please do let me know and I will correct it.

  • Bitcoin

Category : Currency. The first Cryptocurrency ever created.

  • Ethereum

Category : Layer 1 Chain

  • Binance Coin ( 2 variants )

Categories : CEX Coin, Layer 1 Chain ( built using Cosmos SDK, which is a Layer 0 Hub). 1 variant on the Binance Smart Chain ( which is compatible with Ethereum ) and 1 variant is on the Binance Chain which is its own Sovereign Chain.

  • Tether

Category : Centralized Stablecoin

  • Solana

Category : Layer 1 Chain

  • Cardano

Category : Layer 1 Chain

  • USD Coin

Category : Centralized Stablecoin

  • XRP

Category : Currency

  • Terra

Categories : Layer 1 Chain ( built using Cosmos SDK, which is a Layer 0 Hub )

  • Polkadot

Category : Layer 0 Hub ( Connects and secures Layer 1 Chains that run on it )

  • Avalanche

Category : Layer 0 Hub ( Connects and secures Layer 1 Chains that run on it )

  • Dogecoin

Category : Meme Coin

  • Shiba Inu

Category : Meme Coin

  • Polygon

Categories : Layer 1 Chain, Layer 2 Chain for Ethereum ( built using Cosmos SDK, which is a Layer 0 Hub )

  • Coin ( 2 Variants )

Categories : CEX Coin, Layer 1 Chain ( built using Cosmos SDK, which is a Layer 0 Hub ). 1 variant is the ERC-20 Token on Ethereum ( which is compatible with Ethereum ) and 1 variant is the Cronos ( ) coin which is its own Sovereign Chain.

  • Binance USD

Category : Centralized Stablecoin

  • Wrapped Bitcoin

Category : Wrapped Version of Bitcoin ( ERC-20 token on Ethereum )

  • Algorand

Category : Layer 1 Chain

  • Litecoin

Category : Currency

  • TerraUSD

Category : Decentralized Algorithmic Stablecoin running on Terra

  • Cosmos

Category : Layer 0 Hub ( Connects and secures Layer 1 Chains that run on it )

  • Chainlink

Category : DeFi dApp ERC-677 Token on Ethereum Chain

  • Dai

Category : Decentralized Algorithmic Stablecoin running on Ethereum

  • Near

Category : Layer 1 Chain

  • Bitcoin Cash

Category : Currency

  • Uniswap

Category : DeFi dApp ( DEX ) ERC-20 Token on Ethereum Chain

  • TRON

Category : Layer 1 Chain

  • OKB

Categories : CEX Coin, Layer 1 Chain ( built using Cosmos SDK, which is a Layer 0 Hub )

  • Stellar

Category : Layer 1 Chain

  • Axie Infinity

Category : DeFi dApp ( Gaming ) ERC-20 Token on Ethereum Chain

  • Fantom

Category : Layer 1 Chain

  • Lido Staked Ether

Category : Wrapped Version of Ethereum ( ERC-20 token on Ethereum )

  • Hedera

Category : Layer 1 Chain

  • Vechain

Category : Layer 1 Chain

  • FTX Token

Category : CEX Coin, exists on Ethereum Chain as an ERC-20 token

  • The Sandbox

Category : DeFi dApp ( Gaming ) ERC-20 Token on Ethereum Chain

  • cETH

Category : Wrapped Version of Ethereum ( ERC-20 token on Ethereum )

  • Internet Computer

Category : Layer 1 Chain

  • Filecoin

Category : Other. Filecoin is a decentralized storage network based on the Interplanetary File Storage (IPFS) protocol

  • Elrond

Category : Layer 1 Chain

  • Theta Network

Category : Layer 1 Chain

  • Ethereum Classic

Category : Layer 1 Chain

  • Magic Internet Money

Category : Decentralized Algorithmic Stablecoin running on Ethereum

  • Monero

Category : Private and Anonymous Currency

  • Decentraland

Category : DeFi dApp ( Gaming ) ERC-20 Token on Ethereum Chain

  • Tezos

Category : Layer 1 Chain

  • Helium

Category : Other. Helium is a decentralized machine network powered by a physical Blockchain

  • IOTA

Category : Layer 1 Chain

  • Leo Token

Category : CEX Coin, ERC-20 Token on Ethereum Chain

  • cDAI

Category : Wrapped Version of the Algorithmic Stablecoin DAI as an ERC-20 token on Ethereum

For an overview of Parachains running on the Polkadot Layer 0 Hub see

For dApps ( and thus Layer 1 Chains ) built using the Cosmos SDK see

Some Tips

It is definitely not easy to choose the right thing to Invest in. But the longer you are Investing and reading, the more you will learn if your Investment was a good decision.

Do not be afraid to ask about things in Forums or even Subreddits dedicated to the Cryptocurrency in question.

Check social media activity of the Developer Teams working on those projects. Make sure there is actual progress and things being built and not only Hype.

Be aware and afraid of Social Media Influencers, they ARE NOT YOUR FRIEND. They are paid to hype Projects and make you Invest. If you are a beginner NEVER Invest in anything below Top 50 by Mkt.Cap. It is not worth the risk no matter how many people will tell you that it is safe. Make sure that people who for example make a Video about a Cryptocurrency Project are talking about real things being built on it or the technology itself. If there is talk about price predictions or any sort of Technical Analysis, be very diligent and extremely suspicious.

NEVER, NEVER, NEVER give your seed words or Private Keys to anyone EVER. There is no possible scenario where you need to enter your seed words to verify your wallet or to activate it. This applies especially to users of Hardware wallets like Ledger ( which I would recommend to anybody who has more then 200$ invested in Cryptocurrency ). If you use a hardware wallet NEVER enter your seed words anywhere other than the hardware wallet itself. There are 0 scenarios where you would have to input your seed words anywhere other than the hardware wallet.

Make sure to always download browser wallets or software FROM THE VERIFIED SOURCE and do not search for them on Google, rather use the direct link that is provided within the official site. Say you want to download Metamask ( one of the most popular Browser Wallets for Cryptocurrencies ) in order to store your Ethereum. Go to the official website of the Ethereum project which is and click on “Pick a wallet”. Below you will find Metamask with the official direct link to the website where you can download it.

If messaged privately by anyone that wants to help you, NEVER give them your seed words or private keys EVER. If somebody is willing to help you, YOU start the conversation by messaging them, not the other way around. Basically assume that 99% of the private or direct messages you receive are scams, so ignore them completely in almost every scenario.

You can find more tips here, here and here.

This content is for Information and educational purposes only and should not be considered investment advice or an investment recommendation.




My Website : \∆/ Hobbies : Cryptocurrency, DeFi, Web3 and Human Psychology. Degree in Computer Science. Master in 4 Human Languages.