Should newbies choose contracts or Spot? You will understand after reading!



Just entered the crypto world, and I'm stuck on the first step: should I play Spot or contracts? Which one can make money? Which one is easy to get liquidated? Please explain simply:
First, let's state the conclusion:
Want to survive in the long term: engage in Spot trading
Want to double your money quickly (or possibly lose it all overnight): play contracts

1. What is "Spot"?
When you spend real money (like USDT) to buy coins, the coins will be genuinely in your account. For example, if you buy BTC with 1000 USDT, the BTC is yours. If it goes up, you profit; if it goes down, you lose, but the coins are still there and won't be "liquidated".
Suitable for: newbies, small funds, and those who are optimistic about long-term projects.

2. What is a "contract"?
You don't really need to buy coins; you just bet on the price going up or down and can also leverage (borrow money to increase your stake). Using 10x leverage to go long on BTC, if it rises by 1%, you earn 10%, but if it drops by 1%, you could be liquidated, and your account could go straight to zero. Essentially, it's directional gambling + leverage amplification.

Who is it suitable for: Short-term experts with a stable mindset, experience, and understanding of position control.

3. Key Comparison:
Assets held: Spot has (buying real coins), contracts do not (betting on direction)
Leverage: No Spot, available for contracts (high leverage)
Profit and Loss Mechanism: Spot price increase or decrease = Profit and Loss, Contract direction correct = Profit
Risk of liquidation: Spot is not likely, contracts are very likely.
Target Audience: Spot is suitable for newbies/long-term, contracts are suitable for experienced traders/short-term.

❗️Common pitfalls for newbies:
Seeing others make quick money from contracts, I got impulsive and jumped in → liquidation
Not understanding position management, going all in → consecutive losses
Lost money leads to a breakdown in mindset, emotional increasing positions → The more you lose, the more you gamble.

🧠 Sincere suggestion:
Just entering the circle, honestly start with Spot! First, feel the market fluctuations, learn to read the market, manage your positions, and understand candlestick charts. Don't be fooled by "10x wealth"; what others earn is likely what you lose. Trading coins is not about speed, it's about understanding and mindset!

#区块链 # Cryptocurrency #投资需谨慎 # USDC #比特币 # newbie guide #小白来理财 # beware of scams
BTC-0.3%
View Original
post-image
This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.
  • Reward
  • Comment
  • Repost
  • Share
Comment
0/400
No comments
Trade Crypto Anywhere Anytime
qrCode
Scan to download Gate app
Community
English
  • 简体中文
  • English
  • Tiếng Việt
  • 繁體中文
  • Español
  • Русский
  • Français (Afrique)
  • Português (Portugal)
  • Bahasa Indonesia
  • 日本語
  • بالعربية
  • Українська
  • Português (Brasil)