One of the biggest traps you can fall into when diving into crypto is being unclear on your goals. This resource will help you get the conversation started on your goals before diving into crypto and finding yourself deep in the weeds without a plan.
Disclaimer: We are not financial planners, and this is not investment advice—so it’s essential you think critically about your crypto investments and consider your own personal situation.
Key Takeaways
- One of the biggest traps you can fall into when diving into crypto is being unclear about your goals.
- Before you get started with crypto, establish clear goals that define what you want to get out of it.
- Setting clear goals and understanding your reasons for being here can help you avoid costly mistakes or succumbing to FOMO (i.e. fear of missing out).
Contents
- Why Set Goals?
- Setting Goals
- How to Set Effective Goals
- Understanding The Risks
- It’s On You At The End Of The Day
Why Set Goals?
If you’re ready to start buying, swapping and trading cryptocurrencies, it’s key to set some goals to understand exactly what you want to get out of it and develop a plan of attack!
Goal setting can help to create a clear plan, so you can avoid mistakes and the dreaded FOMO.
With so many different cryptocurrencies, it’s so important to plan your goals and what you want to get out of them before getting stuck in a bad situation or unclear about what to do next.
Goals help you understand what you want out of the crypto space. This can help in many ways, particularly during times of high volatility in the crypto market.
Setting Goals
Before diving into crypto, you should establish clear goals that define what you want to get out of it. What are you here for?
| What Are You Here For? |
| A trader? |
| A long-term holder? |
| Are you interested in blockchain technology? |
| Want to understand crypto so you can become your own bank? |
| To expand your knowledge and land a job in the industry? |
| Which Cryptocurrency Areas Do You Want To Learn More About? |
| Do you want to learn about staking or yield opportunities? |
| Are you interested in getting involved with NFTs? |
| Do you want to use stablecoins? |
| Are you primarily focused on using DeFi? |
| Do you want to learn more about web3 as a creator? |
Key Questions To Ask
Only you can come up with your goals, but there are a few questions to ask that can inform your goals.
| Are you a short-term trader or prefer long-term holding? |
| What is your timeframe? |
| How old are you? Are you approaching retirement age? |
| When do you need your initial capital back? |
| How much risk tolerance do you have? |
| How much money are you willing to invest and potentially lose? The loss part is essential— remember, crypto is extremely risky, and you can lose some or all of your initial investment, especially in ‘altcoins’ (cryptocurrencies outside of Bitcoin). |
| Do you have particular goals for why you’re allocating to crypto? |
How to Set Effective Goals
Consider applying some of these golden rules of goal-setting:
- Setting realistic goals
- Being consistent
- Avoiding ‘guaranteed money’
- Diversifying
- Understanding the risks
Applying the SMART goal-setting framework can also help.
Understanding the Risks
It’s critical to understand the risks in crypto when you’re setting goals. Understanding the risks better can help influence your goals and provide more clarity so you can avoid common mistakes.
Two great resources to help you understand the risks:
Anything outside Bitcoin is considerably riskier
It’s essential to be prepared to lose some or all of your initial investment if you allocate outside Bitcoin. This is because the further you go out of the top 10, 25, and 100+, the higher the risk your crypto could go to zero.
Even Bitcoin is not guaranteed to survive—at the end of the day, crypto and web3 are still in the early stages of their development—newer inventions or systems could outpace them.
Ultimately, It’s On You
This resource aims to help get the conversation started about your goals and targets. We are not financial advisors nor financial planners, so we cannot give you the ‘answers’.
Only you have this responsibility, but we can help you think about the right questions to ask, consider your timeframes and give you the information to make the most informed decisions possible!