Having been in this industry for so many years, I have seen too many people get rich overnight, and even more lose everything. Today, I want to share with you the pitfalls I’ve encountered and the lessons I’ve learned over the years, hoping to help everyone avoid detours.

**Policy and Regulatory Risks — The Most Unpredictable**

Cryptocurrencies are inherently decentralized, which conflicts with the financial regulatory systems of many countries. Look at the market charts—just yesterday, prices were rising nicely, and then suddenly a country issues a ban or an exchange is asked to delist certain tokens. The market plunges immediately; a 50% drop is considered lucky. Retail investors face information asymmetry and have no way to predict these events in advance, nor do they have effective hedging strategies. Such black swan events often come suddenly and are impossible to prevent.

**Market Volatility Risks — Don’t Touch If You Lack Strong Mental Resilience**

Daily fluctuations of 20% to 30% are as common as eating and drinking in the crypto world. Major coins like BTC and ETH experience this regularly, let alone smaller tokens—doubling or even going to zero is not news. Whales can manipulate the market with a single move; a big bullish candle might make you feel wealth is within reach, but a sudden bearish candle can trap you at a high position, leaving you unable to move. This psychological torment is not something everyone can endure.

**Project Zeroing Risks — How Deep Is the Aircoin Harvesting Trick?**

Over 90% of altcoins on the market are essentially aircoins—without real application scenarios, no technical barriers, and the only goal of the project team is to “harvest” investors’ funds. No matter how fancy the packaging or how loud the slogans like “Metaverse” or “Web3” are, once retail investors buy in, the team often cashes out and disappears, leaving the coin’s price to zero. Finding someone to defend your rights is impossible. This scam has been repeated countless times in the crypto space.

**Exchange Security Risks — Is Your Asset Truly Safe?**

Exchanges seem to be the transfer stations of funds in the crypto world, but they are not as secure as you might think. Hacks, platform collapses, internal theft—these incidents happen more often than you’d expect. How many major exchanges have experienced security breaches? Users’ assets get frozen, withdrawals become difficult, and ultimately, they have to accept losses. Smaller exchanges are even riskier—runaway risk is always present. Storing your money on an exchange is like putting eggs in someone else’s basket; the risk is always there.

**Liquidity Risks — You Might Not Be Able to Sell When You Want**

Some small-cap tokens look tempting with attractive gains, but their trading depth is insufficient. When you want to sell large amounts, there may be no buyers. Orders sit unfilled for hours, or you’re forced to sell at a significant discount just to get out. Even if the price recovers later, you can only watch helplessly. Liquidity traps turn paper gains into paper losses for many investors.

**Technical and Smart Contract Risks — Code Bugs Can Be Catastrophic**

If DeFi projects or token contracts have coding flaws, discovering vulnerabilities can lead to major incidents. User funds might be drained directly, or contracts could be frozen. Such events happen frequently in the crypto market; whether they can be prevented depends entirely on the project team’s technical strength.

**Core Advice**

Always remember in crypto investing: don’t put all your chips into a single project, leave room for risk buffers. Policy changes are unpredictable, market fluctuations are uncontrollable, and the only thing you can truly control is your position and mindset. Claims of guaranteed profits are nonsense; real investors silently endure the market’s tests.