The key thing to know about cryptocurrency: Nobody knows anything

This situation is unprecedented, no matter what anyone says.

The one thing you need to know about the cryptocurrency craze is that we're in uncharted waters.

You can read hundreds of articles featuring cryptocurrency experts saying it's the future, and the only way it can go is up.

You can find a similar number of investors and economists who say this is a bubble, you stand to lose all your money, and it's another "Dutch Tulip bulb" fiasco from the 1600s.

Some of them might be right, some might be wrong, but that's the point I'm making ... nobody knows.

What we're seeing right now with the huge surge in cryptocurrency valuations (as of Jan. 16 it's a massive plunge) is that nobody can predict with any certainty what will happen in the weeks to come.

We stand at a juncture where unregulated digital currency is fighting to replace government-backed money amidst the technology age. 

It's unprecedented, no matter what anyone says, and as such is nigh-on impossible to predict.

There are so many variables at play here, including but not limited to:

  • The tech is still in its infancy. 
  • Nations are uneasy about their currency being undermined and are considering crackdowns (China and Korea have already done this)
  • The crypto market is flooded and it's not known which coins will survive and thrive.
  • Early adopters are cashing in, causing huge value fluctuations.

You need to go into it knowing that all bets are off. For the foreseeable future, cryptocurrency will remain an insanely volatile investment.

Based off my admittedly limited experience in the market, here are a few tips for first-timers.

How do you get started in cryptocurrency?

The basics

The easiest way to get started in crypto is through Coinbase, which allows you to buy Bitcoin, Bitcoin Cash, Ethereum and Litecoin.

There are alternatives out there, but Coinbase is particularly user-friendly. 

That said, it's a little pricey. You pay a fee of at least $1 every time you make a transaction and you're not going to get the market rate for any crypto you do buy (so if Litecoin is valued at $200, Coinbase will allow you to buy it for $202, for example).

Graduating to "altcoins"

The problem with Coinbase is that Bitcoin, Ethereum and Litecoin are relatively high-value, and if you're looking to invest in penny stock cryptocurrencies you'll need to sign up for a Bitcoin exchange site like Binance or Kucoin.

You can then send Bitcoin and Ethereum from your Coinbase account to these exchange sites, where you can change the currency for smaller value altcoins.

There may be hundreds available depending on the exchange. Blocknomi has a list of the best exchanges here.

Protecting your money

Whenever you sign up to buy cryptocurrency, make sure you activate 2-step authentication (passwords + text message to your phone) to provide some protection against hackers.

Even so, keeping money on exchanges isn't completely safe, so you might want to consider getting a secure crypto wallet where you can transfer your money. Techradar has a list of some of the best here.

A few tips for first-time investors

Don't invest what you can't afford to lose

Hearing stories of crypto investors who got on board a year or two ago and are now millionaires sounds enticing, doesn't it?

But to become a crypto millionaire, chances are you're going to have to put down a significant chunk of cash – don't do that. The chances of losing it are very real. 

Only invest what you can afford to lose and no more.

Do some research

Cryptocurrencies are created for different uses – Ripple (XRP) for example is designed to assist with transfers between financial institutions. Before you decide to invest in one, read up on it and see if you feel there's a potential future there. 

But don't believe everything you read

Social media is flooded with posts from "experts" predicting the next "moonshot" (i.e. huge upswing) is imminent.

Most of those making these predictions will have skin in the game and stand to gain from more people investing.

Don't look at prices every day – therein madness lies

Sure, keep an eye out for significant changes to the industry, but if you're planning on staying invested for a long time, don't check your account every day.

It's so volatile that you could fall into the trap of selling during a temporary dip, only to see it surge in price hours later (that's happened to me); or you buy on an upswing only to see it plunge thereafter (which also happened to me).

Maybe checking once a week is the way forward.


No matter what you're investing in, whether it's stocks, bonds or mutual funds, don't put all your eggs in one basket. 

Crypto is no different – if anything it's even more important. Because of the huge volatility between currencies, and the chance they could disappear altogether, make sure you split your money between a few to hedge your bets.

The Tip Jar is consumer writer Adam Uren's advice column on how to spend, save, and live with confidence. Read past columns here.

Next Up

Grand casino

Grand Casino celebrates 30th anniversary with more than cake

Hundreds of thousands of winning dollars are on the table.

Brodd defense witness

As defense starts, expert argues Chauvin's use of force was reasonable

Use-of-force expert Barry Brodd testified on behalf of the defense.

Chet Holmgren

Chet Holmgren named Minnesota's Mr. Basketball

Minnehaha Academy produces back-to-back award winners for the second time in state history.

Byron Buxton

Red Sox out-slug Twins in chilly matinee

Bobby Dalbec hit two RBI doubles to hand the Twins their third straight loss.

Governor Tim Walz

As CDC urges Michigan to shut down, Gov. Walz watches closely

Walz says there are no imminent plans to dial back.


Man, 26, collapses and dies at event center shortly after altercation

The incident was reported Saturday night in Stearns County.

Allina Crossroads Campus

Allina Health will reopen Buffalo clinic after fatal mass shooting

A timeline about when the clinic will reopen hasn't been released.


The Tip Jar: Costco vs. Sam's Club, which is cheaper?

We also compared the 2 wholesalers' prices with a regular grocery store.

The Tip Jar: How I'm using an app to save and invest money

It's helping me set aside a few extra bucks every week.

The Tip Jar: Getting the Black Friday sales right

Full disclosure, I don't like Black Friday.

The Tip Jar: Are air miles credit cards worth it?

And are they better than frequent flyer miles?