Personally, I’ve been investing no small amount of money into cryptocurrencies the past couple years
and have spent a lot of time and money trying to learn as much as I
can about this wild west of decentralized finance.
But I’ll be honest, if it still feels complex and confusing for somebody like me,
I can only imagine how you might be feeling right now, whether you’re young and eager
to get your piece of the pie or you’re older and you want to diversify your investments.
Either way, I want you to pay attention as I detail a few of the mistakes that I’ve made
and the four things you need to do before you get started.
Welcome to All Things Secured, my name is Josh and for the sake of
any legal protection, I’d like to start by saying that this video does not constitute
financial advice and anything I’m saying here is for informational purposes only.
Any investments you make should be done carefully and with acknowledgment of the risks involved.
I invest in crypto and I’m bullish about the future, but that doesn’t mean that you need to.
Perhaps you’ve read the stories of people who have lost tens of thousands and sometimes much more,
to crypto scams. This is particularly true of the older generation , but even if you’re younger,
don’t think you’re immune. FOMO is a real condition that makes us do stupid things.
But more than that, crypto introduces a new kind of risk that we’re not used
to - control. When I was first naively diving into crypto, I opened a number of different
wallets and purchased a couple assets that were tied to one particular wallet.
The beauty of blockchain technology is that those assets, one of which was a blockchain website,
can’t be censored or changed on the blockchain. The danger of blockchain technology is that
if you lose access to your wallet that you’re supposed to control, which I unfortunately did,
there is no reset password button. At least not when you hold the keys. Until I find the
keys to that wallet, those assets are pretty much worthless to me. I can’t do anything with them.
If all of this is confusing to you,
don’t worry. I’m not trying to give you a full beginner’s guide to crypto here.
What I would like to do, though, is to make sure you’re prepared for this journey by giving 4
foundational steps you need to take before you invest a single dollar into cryptocurrency.
For goodness sake, do not put your life savings into crypto, ok?
No matter how amazing it sounds - and trust me, when you start hearing things like 2000%
returns, and that’s not an exaggeration, it takes willpower not to jump in with both feet.
In fact, I strongly urge you to avoid moving any money from current investments you have until
you’ve spent at least a few months, if not a year learning by investing smaller amounts in crypto.
When it comes to risk tolerance, there are three questions you should ask and I would
even write down your answer for. First, if you lost all of the money you’re about to invest,
where would that put you and your family? If the answer is anything other than “we’d be bummed,
but we can still retire comfortably”, then you need to recalculate.
Question two: what percentage of my net worth am I willing to speculate with? This is kind
of like entering into a casino. If you haven’t already determined how much you’re willing to
spend before you start, you’ll likely spend more than you should. Write down either a dollar amount
or a percentage of your salary or net worth you’re willing to invest, and stick with it.
Finally, do I have the support of my spouse and or family members. This is
particularly true if you’re investing what will likely be your wife’s nest
egg or your kids’ eventual inheritance. These decisions affect more than you,
so you need to take that into account when calculating your risk tolerance.
If you ever find yourself saying, “I need to invest now or else I might miss out on incredible
gains!” Just Stop! Trust me, you or whoever is advising you to make this kind of purchase
is not smarter than the hundreds of thousands of people who have tried
to time the market before you and lost millions.
Take your time. Wait at least a day or two. If this is an investment you think is worth making,
then it’s worth taking your time on it. And whatever gains you potentially lose out on
by waiting, you can just chalk up to being the cost of security. Urgency is your enemy here.
Some of the highest interest rate returns I’ve seen in the crypto space have come from
untested coins and unproven platforms. In other words, crazy promises in return for crazy risk.
This is probably the most common way that beginners get scammed in the crypto
world - investing your hard-earned money into a platform that looks like a legitimate place
to buy and sell crypto, it seems to show you incredible returns on your investment so that
you’ll keep pouring money into it, and then simply disappears when you try to pull your money out.
For the sake of security, you can open an account with a trusted company like
Coinbase and use that as the primary place where you buy
and sell crypto. This is called an exchange - you’ve probably heard that term before.
An exchange is critical because this is where you put in your fiat currency, the money that’s
in your bank, be it US dollar, Euro, whatever,
and get cryptocurrency in exchange, be that Bitcoin, Ethereum or some other coinn.
But the next step is super critical, and this is where I went wrong. You need to set up what’s
known as a digital wallet and you need to keep good track of it. These wallets are confusing
because they take so many forms. You can download the Coinbase wallet and move your crypto there,
or you can take the more secure route and use what’s known as a cold storage wallet
like what you see here. I’m not going to go into the details about hot verses cold storage because
for a beginner, it’s best to start with a mobile wallet like this one from Coinbase.
Bonus Tip: did you know that your wallet address is between 26 and 35 alphanumeric characters long?
Most people don’t memorize it and others don’t
realize how risky it is to copy and paste everywhere.
So what’s the solution? That’s where blockchain domains step in. If you and I are trying to
exchange crypto, which do you think is easier? I could tell you to send it to this address,
but keep in mind that even if one character gets accidentally deleted or changed,
all the money gets lost. OR, I could give you my blockchain domain that I
bought at Unstoppable Domains, who are also sponsoring this video.
You can get by without a domain, hear me clearly, but when you consider that buying
your own personal name or brand name costs as little as $20 and you never have to renew again,
it’s really a no-brainer in my opinion for anybody getting into crypto.
All I did was purchase the domain, connect it to my wallet, which is called minting,
and then add all the crypto addresses for each crypto asset I own or want to own. Then,
whenever you want to get paid for something, you just tell them to send it to, for example
allthingssecured.wallet and the risk of getting the address wrong shrinks to almost nothing.
It’s still pretty early, so chances are your
name is available as a blockchain domain. Go grab it while you can!
The final step you need to take as you’re getting started with crypto - and this
should come as no surprise to those of you who have followed this channel for a while - is to
set up 2 factor authentication. Not next week; not tomorrow. Right now.
Any crypto-related account such as BlockFi, Celcius, Crypto.com, Coinbase and
others give you the option to secure your account with a second security factor,
which could be an authenticator app or my personal favorite, the 2FA security key.
Now, if somebody steals or somehow hacks my username and password for any of these
crypto exchanges, they will be required to enter this second form of identification.
Since they won’t have access to my authenticator
app or security key I use, the stolen credentials will be useless to them.
This is just the tip of the iceberg. If you want to dive even deeper into crypto,
check out this in-depth interview I did with Naomi Brockwell.
And to purchase your own blockchain domain like I did with joshsummers.wallet
and allthingssecured.wallet, go visit Unstoppable Domains and get yours before it gets snatched up.