After eight years of trading cryptocurrencies, I have grown from a clueless novice who lost all my savings into a seasoned analyst. This transformation was not due to luck, but rather a comprehensive set of tools. Many retail investors trade based purely on intuition, buying whatever others recommend, resulting in significant losses. Today, I will share with you the four tools I use most often to help you transition from 'blindly following the crowd' to 'rational investing' and avoid 90% of common pitfalls.
The first tool: Gas tracking tool (Etherscan's Gas Tracker). Many retail investors are unaware that gas fees are 'network congestion fees', and during transactions on the Ethereum mainnet, fees can be as high as several dozen to even over a hundred dollars. Before each transaction, I always use this tool to check the current gas prices and choose to trade during low-fee periods, which can save a considerable amount in transaction fees over the year. For example, during the early morning or late night, when network congestion is lower, gas fees can be more than 50% lower than during the day.
The second tool: Project rating tool (CoinGecko/CoinMarketCap). Many retail investors blindly invest in altcoins, resulting in encounters with scam coins or fraudulent projects. Before I invest in any project, I always use these two tools to check the project's rating, team background, open-source code status, and liquidity lock status. If a project's rating is below B, or the team background is opaque, I will never invest. For example, there was an altcoin project with a CoinGecko rating of C-, and I couldn't find any team background, so I decisively gave up, and later, this project indeed ran away with the funds.
The third tool: Blockchain explorer (Etherscan, Solscan). This tool is an "essential artifact" for trading coins, allowing you to check the transfer records of any wallet, the flow of funds in the project, contract code, etc. Before each investment, I always use it to check whether the project's contract is open-source, whether the funds are locked, and whether there are any abnormal transfer records. For example, if a project's funds are concentrated in one wallet and there are numerous transfer records, it indicates that the project party may be cashing out, and you must avoid it.
The fourth tool: Tax tool (CoinTracker). Many retail investors overlook tax issues and end up being fined by the tax bureau. In the United States, the IRS considers cryptocurrency assets as "property," and transactions are subject to capital gains tax; even in China, although trading is prohibited, the appreciation of held cryptocurrency assets may also involve tax issues. I use CoinTracker every year to automatically generate tax reports, recording all transaction records and earnings to avoid tax risks.
In addition to these four tools, I also use some auxiliary tools, such as market analysis tools (TradingView), community monitoring tools (Telegram/Discord monitoring plug-ins), etc. These tools help me better understand market dynamics and make rational investment decisions. Many retail investors feel that "using tools is too troublesome," but I want to say: trading coins is a high-risk investment, and only by equipping yourself with professional tools can you survive in this market for the long term.
I will explain in detail how to use each tool later, including how to use the blockchain explorer to check the flow of project funds and how to use the project rating tool to filter for quality projects. Follow me @链上标哥 to avoid getting lost! Let you transform from a "retail investor" to a "veteran," making stable profits in the cryptocurrency circle.
