These mistakes can cost you money or prevent you from buying.
Baby Doge Coin may have only launched at the beginning of June, but it was an almost immediate success. In the first 15 days, the price increased by over 1,000%. While a significant drop followed, it has since hit a new all-time high thanks to Tweet from Elon Musk.
With the potential for great returns, many people are jumping on the bandwagon and buying Baby Doge Coin. This is not the most straightforward process, especially if you have not purchased smaller cryptocurrencies before. Here are the mistakes to avoid so that everything goes smoothly.
1. Don’t search for Baby Doge Coin first
First things first, buying Baby Doge Coin is not a decision you should rush into. This is a new and very volatile cryptocurrency, and there is a high probability of losing money in it.
If you’re interested in Baby Doge Coin because you saw something on Reddit, YouTube, or elsewhere about how huge it would be, take some time to review their website and whitepaper first. Do your research instead of taking someone else’s word that it will make you a millionaire.
Baby Doge Coin has been a success so far because of the hype behind it. This is not a sustainable long-term strategy, which is one of the reasons why many enthusiasts do not view it as a good investment in cryptocurrency.
2. Choosing the wrong cryptocurrency exchange
It does not list the major cryptocurrency apps and exchanges Baby Doge Coin. With so many cryptocurrencies out there, these exchanges are very selective about which ones they offer. As a relatively new and small token, Baby Doge Coin has yet to make the cut.
PancakeSwap is the most popular place to buy Baby Doge Coin at the moment. This is a decentralized exchange where users contribute cryptocurrencies used for trading.
The process of trading on PancakeSwap may be different from what you are used to, but it is not very complicated. On the PancakeSwap website, you need to connect a crypto wallet, then go to the exchange page to make your trade.
3. Expect to buy it for cash
PancakeSwap is not the type of exchange where you deposit cash and use it to purchase cryptocurrencies. It only allows you to trade one cryptocurrency for another.
After you connect your crypto wallet to PancakeSwap and go to their exchange page, you can select the cryptocurrency you want to trade for Baby Doge Coin. Binance Coin (BNB) is a popular choice.
If you don’t have any cryptocurrencies you want to trade, you need to buy some from another exchange and transfer them to a crypto wallet first. Here is a step-by-step guide to explain how this works:
- Buy 1 Binance Coin.
- Transfer Binance coins to a crypto wallet, such as Metamask or Binance Chain Wallet.
- Visit the PancakeSwap exchange page and click Connect.
- Connect your wallet to PancakeSwap.
- Trade your Binance coin for Baby Doge Coin.
4. Not setting slip tolerance to 12%
There is one more important concept to know when trading cryptocurrencies on PancakeSwap, and that is price slippage.
Slippage is the price change between when a trade is submitted and when it is executed. In PancakeSwap, you can set your slip tolerance, or change the price you’d like to accept to start your trade. Here’s how to adjust this setting:
- Go to the PancakeSwap exchange page.
- Click the Settings button (the icon in the interchange box with three horizontal bars with stripes).
- Choose one of the preset slip bearing options or write your own.
With highly volatile cryptocurrencies like Baby Doge Coin, trading with a low tolerance for slippage may not work. The Baby Doge Coin team recommends setting the slip tolerance to 12%.
This means that if you trade 1 million Baby Doge Coin, you will likely end up with anywhere from 880,000 to 1.12 million tokens.
5. Spend a lot on it
Be careful about how much money you put into Baby Doge Coin. There have been many cryptocurrencies that start out strong and then end up in limbo. They leave behind a lot of frustrated hopefuls who buy near the peak, only to see their investments plummet in value.
Look at Baby Doge Coin like playing the lottery. If you really want to try it, put a small amount of money in it without expecting to make anything.
To build wealth, stick to retirement accounts and the stock market. And if you want to make crypto part of your portfolio as a high-risk, high-return investment, decide which cryptocurrency to buy based on what they can do and not their popularity.
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