Crypto Frequently Asked Questions (FAQs)
Welcome to Scholarly CryptoNite! Whether you're brand new to crypto or need clear answers, this FAQ covers the most searched, most asked, and most beginner-focused cryptocurrency questions.
General Cryptocurrency Questions
What is cryptocurrency?
Cryptocurrency is digital money that uses encryption (crypto) to secure transactions. Bitcoin and Ethereum are two of the most well-known examples.
How does cryptocurrency work?
Cryptos run on a technology called blockchain—a public, decentralized digital ledger where a network of computers verifies every transaction.What is blockchain?
Think of blockchain as a digital ledger that securely and transparently records all cryptocurrency transactions. Every new transaction forms a “block” that connects to previous blocks, making a secure chain.Is cryptocurrency legal?
Yes. In most countries, including the U.S., cryptocurrency is legal to buy, sell, and hold. However, regulations differ worldwide, so check your local laws.What’s the difference between short-term and long-term crypto investing?
Short-term investing involves buying and selling frequently to capitalize on price swings. Long-term investing involves holding crypto for months or years, allowing it to ride out market fluctuations and ups and downs. Beginners often find long-term strategies less stressful and more rewarding.
Getting Started as a Beginner Investor
How do I start investing in crypto?
Start with three simple steps:Read our beginner’s ebook: Learn Crypto Now!
Explore our Crypto Cheat Sheets for quick education on safety and strategy.
Use our Crypto Investment Calculator to plan your contributions and see your potential growth.
How much money do I need to start investing in crypto?
Start small. Many beginners start with $10 to $50 per month. The goal isn’t to “get rich quick” but to learn the ropes and build confidence. You can always scale up later as your knowledge and strategy evolve. Some start with just $25 per month. Consistency matters more than the starting amount.How do I choose which cryptocurrencies to invest in?
Look for projects with strong leadership, real-world use cases, solid technology, and community support. Avoid investing based on hype alone. Scholarly CryptoNite offers cheat sheets and blog posts to help you make wise choices.
What is dollar-cost averaging (DCA) in crypto?
Dollar-cost averaging means investing a fixed dollar amount on a regular schedule (like monthly), regardless of the crypto price. It helps reduce risk over time.Is it too late to invest in Bitcoin?
No! While Bitcoin’s price has risen over the years, it’s still seen as a long-term store of value. Small, consistent investments today can add up over time.Which crypto is best for beginners?
Most beginners start with Bitcoin (BTC) and Ethereum (ETH) because they are the most established and widely adopted cryptocurrencies.Should I diversify my crypto investments?
Absolutely. Diversification spreads risk across various assets, including Bitcoin, Ethereum, altcoins, and stablecoins. If one asset performs poorly, others may balance your portfolio. It’s a smart strategy for both beginners and experienced investors.
Crypto Tools & Resources at Scholarly CryptoNite
How accurate are crypto investment calculators?
Crypto investment calculators use inputs such as investment amount, duration, and estimated return rate to provide a forecast. While they can't predict the future, they’re excellent for visualizing potential outcomes and comparing strategies. Scholarly CryptoNite’s calculator is built with beginners in mind—simple, educational, and goal-focused.
What is the Crypto Investment Calculator?
Our calculator helps you visualize how your small monthly crypto investments could grow over time. You can adjust your monthly contribution, starting balance, and estimated annual return.What other tools do you offer?
We currently offer:Crypto Cheat Sheets (Security, DeFi, NFTs, Taxes, Altcoins)
The Crypto Investment Journal
Bunny-themed educational videos
Crypto Security & Avoiding Scams
How do I keep my crypto safe?
Crypto itself is secure due to blockchain technology; however, user mistakes can create vulnerabilities. Use hardware wallets, never share your private keys, and avoid unknown links or apps. Follow these basic safety steps:Use a cold wallet (hardware wallet like Ledger or Trezor) for long-term storage.
Secure your seed phrase offline in a safe place—never store it digitally.
Back up your seed phrase and store it offline, safely.
Enable two-factor authentication (2FA) on your accounts.
Be cautious of phishing emails, fake websites, and online scams.
Read the Federal Trade Commission's article: What To Know About Cryptocurrency and Scams
Back up your seed phrase and store it offline, safely.
What is a seed phrase, and how should I store it safely?
A seed phrase is your cryptocurrency’s master key. The seed phrase may consist of a set of words or numbers. If someone accesses it, they can take your funds. At that point, you will not have the ability to reset or recover your investments. Here’s how to store it safely:
Write it down by hand on paper or a steel wallet (like a metal backup plate).
Never take a photo or save it digitally—this creates hacking risks.
Store it in multiple secure locations, such as a fireproof safe, a locked filing cabinet, or a trusted family member’s home.
Avoid cloud backups or password managers unless you use encrypted storage with layered security. Think of your seed phrase as your crypto’s master key. Protect it like you would protect gold or cash.
What is a crypto wallet?
A cryptocurrency wallet stores your private keys and allows you to send, receive, and store digital currency (crypto). Wallets can be:Hot Wallets: Online and easy to use, but less secure.
Cold Wallets: Offline and more secure for long-term storage.
For long-term storage, we recommend using hardware wallets such as Ledger or Trezor. For beginners who require accessibility, hot wallets like Coinbase Wallet can be suitable, although they offer less security.
Can I lose all my money in crypto?
Yes, it is possible. Prices can drop rapidly due to market fluctuations, regulatory changes, or project failures. With that said, crypto is highly volatile. Only invest what you can afford to lose, and never invest without conducting thorough research. Consider diversifying your investments, and never invest more than you can afford to lose. Remember, education comes first, and consider consulting a certified financial professional for guidance.
Understanding Crypto Markets
What is a bull market in crypto?
A bull market happens when crypto prices are rising and investor sentiment is positive.What is a bear market?
A bear market is when prices are falling, and there’s widespread pessimism in the market.Should I wait for a market dip before investing?
Trying to time the market is a risky endeavor. For beginners, dollar-cost averaging is a safer and more consistent strategy.What role does risk tolerance play in crypto investing?
Crypto markets can be volatile. If watching prices swing stresses you out, opt for stablecoins or blue-chip coins like Bitcoin and Ethereum. Your strategy should align with your comfort level regarding risk.
Building a Smart Beginner Portfolio
How should I diversify my crypto investments?
Our recommended beginner model is:Adjust your percentages based on your risk tolerance.
What are altcoins?
Altcoins are any cryptocurrencies other than Bitcoin. Examples include Ethereum (ETH), Solana (SOL), and Cardano (ADA).What are stablecoins?
Stablecoins are cryptocurrencies pegged to stable assets like the U.S. dollar. Popular examples include USDT (Tether) and USDC (USD Coin).
Technical Crypto Terms (Explained Simply)
What is a smart contract?
A smart contract is a self-executing piece of code that runs on a blockchain (like Ethereum). It automatically enforces agreements and executes transactions without the need for intermediaries.What are gas fees?
Gas fees are small payments required to process transactions on certain blockchains (like Ethereum). They vary based on network traffic.What is staking in crypto?
Staking means locking up your crypto to help secure a blockchain network. In return, you may earn rewards. This is common on Proof-of-Stake (PoS) networks.
Crypto & Taxes
Do I have to pay taxes on crypto?
Yes. In the U.S., crypto is treated as property. This means you may owe:Capital gains tax when you sell your crypto at a profit.
Income tax if you earn crypto as payment or rewards.
Always keep detailed records and consult a tax professional.
Here's a resource to get you started with understanding crypto taxes.
Payments, Products & Policies
How can I buy your ebook and other products?
You can purchase all digital products (ebooks, cheat sheets, journals, etc.) directly on our website using our secure checkout system powered by Stripe.Are your products refundable?
Due to the digital nature of our products, all sales are final. If you experience a download issue, please contact us at Support@scholarlycryptonite.com. We're here to helop.
Affiliate Transparency
Do you use affiliate links?
Yes. Some links on our site are affiliate links. This means we may earn a small commission if you make a purchase, at no extra cost to you. We only recommend products and tools we believe in.
Stay Connected
Subscribe to our email list for exclusive tips, crypto tools, and updates.
Follow us on social media:
YouTube: @ScholarlyCryptoNite
Instagram: @scholarlycryptonite
TikTok: @cryptoscholar
What’s Coming Next?
We’re working on:
Self-paced crypto courses
New calculators and tools
Interactive portfolio tracking
Exclusive membership perks
Stay tuned for updates!
Still Have Questions?
Reach out anytime at Support@scholarlycryptonite.com or visit our Contact page.
We’re here to help you learn confidently, invest smartly, and build your crypto future. Remember to always conduct thorough research before making crypto investments.
Disclaimer: This is for educational purposes only. Always conduct thorough research and consult a certified financial advisor before making any investment decisions.