#1 Learn the tax rules

It feels dumb to say, but I didn’t even think about taxes when I started. I was carefree and carelessly tradin’ and buyin’ and sellin’ and just havin’ myself a grand ol’ time. And then I learned that most of what I was doing probably had tax implications.

&*($#.

Luckily, this was only about one month into the journey, and it wasn’t too terrible to get caught up on things. Still, this was my biggest regret in the beginning.

Now, I keep a spreadsheet for all my transactions. I record the cost basis and realized gains & losses when selling or trading. It still gets pretty complex in a hurry, so I also use free services CoinTracker and Koinly to help.

The point here is to know that there are rules and get ahead of them, so you don’t find yourself playing catch-up later. Because it really stinks.

#2 Compare exchanges

I don’t remember how I ended up with Coinbase, but that’s where I started. I’m glad that’s where I started, though, because one of the cool things about Coinbase is their “earn” program that lets you watch videos about new cryptocurrencies to earn small rewards.

Currently, you can earn about $30 in rewards this way. Not only is it great for getting some free crypto, but I also found it interesting to learn about the new cryptos themselves. This helped me understand the bigger picture and how cryptocurrencies play an increasing role in the world.

So that’s one cool thing about Coinbase, but I also find myself looking longingly at Binance and wishing I had assets over there to move onto the low-fee Binance Smart Chain (BCS). And both Coinbase and Binance don’t have certain cryptocurrencies I wish I could buy.

This is why I suggest you shop around. Compare what promotions and sign-up there are to take advantage of. Look for cryptocurrencies. Consider what fees might be involved and lock periods before you can move funds off the exchange. Please do your research so you can maximize rewards and not feel trapped when it’s time to do the things you want to do.

#3 Invest some stablecoins

This one stings on the heels of a bad week because I didn’t do this. There are really great interest rates available, and having the non-volatile assets available to buy the dips is a real treat.

The first place I recommend for this is Celsius. They offer a 12.5% return on most stablecoins. In addition to great rates on stablecoins, they also offer returns for many popular coins like BTC (6%), DASH (5.5%), MATIC (13.99%), and many others. It’s set-it-and-forget-it gains that you earn just by having funds in your wallet.

Celsius isn’t available everywhere, though. Nexo is another site that offers 12% returns on stablecoins and many others. BlockFi is a third option, but they offer just 8.6%. (However, I just read today that BlockFi is a good play to deposit funds and then use your one free withdrawal per month to move USDC to Celsius as a way to dodge fees.)

Having a pile of high-interest earning stablecoins is also great for making sure you have money to pay taxes at the end of the year. (Remember #1?) Consider the 12% return rates here against banks, where high-yield savings might earn you 0.5% interest. Even the stock market, with all its risks, can’t guarantee you these returns.

The tradeoff is that these funds aren’t FDIC insured. Certain providers offer different assurances, so again, do your own research.

#4 Invest in DeFi

Those stablecoin interest rates I was talking about are pretty impressive, but they pale in comparison to the return rates offered by many defi apps. Look around, and you’ll see APYs north of 200%.

I’ve invested a small amount with Cake DeFi, and I’ve been excited about the result. They offer $30 for signing up, and you can earn 130% APY with their BTC-DFI liquidity pool, 5–7.5% on BTC with their Lapis service, or 37% by staking DFI.

DeFiChain (DFI) is their native coin, and it’s trading for about $3.50. Cake DeFi’s goal is to bring user-friendly, high-return crypto financial services to the masses, and so far, they’re delivering. I like here because of the high returns plus the high potential of the DFI coin.

I’ve invested $500 with Cake DeFi, and every day I earn about 0.50 DFI and a couple of satoshis of BTC. I did the match, and the story checks out: it amounts to approximately 130% APY return.

Cake DeFi is just one option, though, and not an especially popular one at that. Harvest, Beefy, and many others exist — look around!

#5 MetaMask & Web3.0

It took me a minute to understand how a lot of the distributed apps (dApps) worked. It’s a different world. You don’t sign up with usernames and passwords and have accounts. Instead, you connect your wallet, and that’s who you are.

I started using Trust Wallet, and it’s been fine. There’s a built-in browser that I can use within the app that seems to work pretty well. I can also use the MetaMask browser extension for Chrome to use the same wallet on my desktop computer.

This has allowed me to expand into ETH2 staking and investing with SnowSwap and use one of the most popular dApps — Uniswap — to obtain tokens that aren’t available through the exchanges.

It’s a non-intuitive process to pick up coming from the traditional internet world we all know & love. And I’m a pretty tech-savvy person. Just having the awareness that this is a thing probably would’ve been enough to make it intuitive enough to grasp, but there’s no web3.0 handbook that really spells it out.

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Source: https://medium.com/this-crypto-life/if-i-could-start-my-crypto-life-over-8577de8debda?source=rss——-8—————–cryptocurrency