It's no secret that many people have become millionaires trading in bitcoin. This has generated interest in cryptocurrencies, and more and more newcomers are trading in it, whether to get rich or otherwise. Most newbies in cryptocurrency are doing so to earn money. Sadly, this leaves them susceptible to scams and Ponzi schemes that promise quick returns. If they don't lose their money to scams, they do so to their inexperience in trading. This post is an attempt to save newcomers to cryptocurrency from all this trouble. Here are five tips for newcomers.

1. Do. Your. Research.

I cannot emphasize this enough. Most people going into cryptocurrency don't even know how it works. This leaves them susceptible to scams preying on their unawareness of cryptocurrencies.

2. If it's too good to be true, it probably is.

BitClub Network was a sophisticated scam that duped customers of $722 million. With a $99 starting fee, coupled with $500 to join a mining pool, investors were promised returns for years to come. This had all the signs of a scam, so much so that the creators of the scam were alleged to have called their customers "dumb sheep" and to have said that they were "building this whole model on the backs of idiots".

BitClub Network operated for five years, from 2014 to 2019. In those five years, many experts raised concerns, but they were quickly dismissed. This shows that a scam could look legit but be in fact a scam. So, in short, if it looks too good to be true, it probably is.

3. Invest money that you are prepared to lose.

Cryptocurrency is known mostly for its wild price swings - one day you could become a millionaire overnight, and the other you could lose almost all your money. While the prospect of doubling your money in weeks is enticing, you should know that you probably have a greater chance of losing money than earning it, especially if you are inexperienced in trading. Long story short, only invest money you are comfortable losing.

Stay tuned for more articles and tips about cryptocurrency on my blog.