The allure of cryptocurrency has drawn millions into the craze. The stories of people becoming millionaires overnight during the 2017 boom are too irresistible. As such, it’s easy to have an unrealistic view of how people make money off crypto trading.
When getting started with crypto trading and digging for helpful resources, you’ll likely come across “signal trading groups.” These groups promise to help you maximize on your trades by providing you with winning buy/sell signals. However, you need to take these promises with a grain of salt.
What are Crypto Signals Groups?
These are communities/groups where the creators publish live trades that members can use to enter into trades. The essence of a crypto signal group is for the members to ease into crypto trading by following these guides/signals that dictate to them where and when to buy crypto and when to rope in profits.
Crypto signals groups can be paid or free. Usually, paid crypto groups offer deeper insights, more regular signals, and in some cases, trading advice. Free groups, on the other hand, are more likely to merely churn out signals without much thought paid to the process.
In an ideal environment, a crypto signal group should guide traders to make profitable decisions backed by actual market analysis and accurate interpretation of market trends. Instead, we have unoriginal info being packaged as new, overly expensive subscriptions not worth the penny, and other undesirable practices around the art that should have you questioning the need to join.
Here are some compelling reasons why you shouldn’t join crypto signals groups.
1. Targeting of the Inexperienced
Usually, crypto signal groups target beginner traders who are still looking to gain a foothold in the world of crypto trading. Since they’re still familiarizing themselves with even the tiniest of details, they’re willing to fork out cash for the promise of handholding.
But that’s hardly the problem. The thing is, these traders are likely to accept any and all information coming their way and trust it as the gospel. One of the surest things in crypto trading is doing your own research and verifying information. If you’re not doing this, you’re risking money. In crypto trading, no one can look out for your interests better than you can.
2. No Learning Here
Some crypto signals groups, especially paid ones, provide in-depth analysis of crypto trends, what’s triggering what in the crypto world, and how you can better optimize your knowledge for smart decisions.
But these groups are the exception, not the norm. Most crypto signal groups typically spoon-feed traders, who then never get to learn why certain calls were made, why the crypto market is moving a certain way, and how to base future trading decisions.
As we’ve noted before, some crypto signal groups are free. But for the most part, these groups are low-effort.
Paid groups, for their part, cost money. Some go for up to hundreds of dollars per month. Most crypto traders are just trying to make money. If they follow trade signals blindly, it can lead to their entire savings going up in smoke.
4. Pump and Dump Scams
Some crypto signal groups are run by individuals who do the right thing. Others are pump and dump scams. Usually, the group leader will hype up some low-cap coin and sing praises of how it’s going to be the next big thing (pumping). This will cause the coin’s demand to shoot up as more people rush to invest in.
After the price soars, the group leader will then offload their holdings. This is what’s called ‘dumping’. After offloading, the coin floods the market again, losing value. Investors will then be left with a worthless coin in their hands, one which they might never get an opportunity to offload profitably.
5. Work of Copy
Most of the time, the ‘novel’ innovation presented in these groups is anything but novel. On the contrary, many of the group leaders of these groups are actually following other crypto signals groups. Then, they will gate keep the best of the info and present the rest.
Other group leaders will relay buy and sell signals without a single shred of analysis on how they arrived at a particular decision. They make it look like the market is ripe for amazing profits anytime. The truth could not be more different.
6. Manipulation and Lies
Quite often, these groups will say anything just to get more subscribers. But without you going back to their posts and comparing them with actual market figures, it’s very easy to get duped. It’s not uncommon to see signal groups making unrealistic claims about the massive profits they stand to gain, while in actual sense, they’re manipulating figures.
It’s exactly as it looks like. The information these groups are peddling – you too can find it where they’re sourcing it from. Many of the most successful traders post their analysis on forums like Facebook and Twitter.
The thing is, this info is freely available. Its originators aren’t charging for it, so why should you? Moreover, when you go to the original source, you get to learn so much more than just responding to signals.
8 Here Today, Gone Tomorrow
Again, there’s no catch here. Most of these group leaders are in it for the money, and guess what? There’s the chance they’ll be gone as soon as they figure they’ve made enough of it. And, of course, if they disappear, chances are high the group will too and with it, your money.
What You Can do Instead
Instead of joining crypto signal groups, which are rarely worth the money, what can you do instead? One of the surest strategies you can look into is social trading. Social trading is not a new thing by any means. Going back centuries, people have always looked upon each other to be guided on critical decisions. By listening and taking cues from others, we can always make wiser decisions on many things.
The same applies to modern trading. Experienced traders make better decisions than beginners primarily due to their exposure in the game and continued mastery of the skill. Some platforms such as eToro allow traders to leverage the knowledge of experts in the community so as to improve on decision making and portfolio and asset choices. Social trading can either be copy trading or relying on social forums for trade ideas.
- Copy Trading
Copy-trading allows inexperienced traders to copy the moves of more experienced and seasoned traders. This strategy gives traders the opportunity to participate in the markets when they don’t have the time or experience to do so.
New traders get to rely on others’ experience while acclimatizing to the trade. They also get the chance to learn new strategies from others and, in the process, become better traders themselves.
- Social Forums
Social Forums are avenues where you can talk to other traders and exchange trading ideas and knowledge off each other. These forums are on platforms such as Reddit, Telegram, Twitter, and Facebook. Other forums were made with the sole goal of building reliable crypto communities.
Topics in these communities are exclusively dedicated to discussing trends in crypto, trading, market movements, mining, and other crypto trading technicalities. Some of the most popular crypto forums include Bitcointalk.org, Altcoincommunity.net, Mastersofcrypto.com, and Cryptocurrencytalk.com.
The ideal crypto group signal should be reasonably priced, provide original and profitable ideas, and provide insightful market analysis. Even then, these kinds of groups are not necessary for your path as a crypto trader. Following the moves of actual industry experts and learning from the insights of fellow traders can prove to be a far more fruitful approach.