Are Ethereum and Bitcoin both stablecoins? An analysis of the 3 major cryptocurrency differences beginners often confuse

"I want to buy a stable cryptocurrency, so buying Bitcoin should be safer, right?"

If you think so too, then this article is for you. This is precisely the most common fatal misconception among crypto beginners. Many mistakenly believe that "Bitcoin is famous = price stability," only to panic sell during a major dip after buying, leading to significant losses.

Please keep one core concept firmly in mind:
❌ Bitcoin is not a stablecoin
❌ Ethereum is not a stablecoin
✅ Only those with "USD" in their name are likely stablecoins (e.g., USDT, USDC)

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Understand the three differences in a nutshell

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Why aren't Bitcoin and Ethereum stablecoins?

Bitcoin (BTC): Digital Gold, Not Digital Dollar

• Essence: A scarce asset with a total supply of only 21 million units, its value is determined by market supply and demand.
• Volatility Examples: Historically, from its peak to its lowest point,it has fallen by over 80%.. In 2021, there was a single-daycrash of 30% incident.
• Conclusion: It is an "investment asset" aimed atlong-term appreciation, not price stability.

Ethereum (ETH): Blockchain Fuel, Even More Volatile

• Essence: The "fuel" of the Ethereum network, used to execute smart contracts and pay transaction fees.
• Volatility Examples: Its historical volatilityis even higher than Bitcoin's, and it has also fallen from its peak to its lowest point byover 82%..
• Conclusion: It is also an 'investment asset,' with its value tied to the demand for the Ethereum ecosystem, making it equally unstable.

Stablecoins: The Truly 'Stable' Choice

• Essence: Cryptocurrencies designed to maintain price stability, typicallypegged 1:1 to the US dollar.
• Price Performance: 99.9% of the time, the price fluctuates between 0.99 and 1.01, with a deviation of less than 1%.
• Main Uses: Medium of exchange, hedge against volatility, cross-border payments, earning stable interest on exchanges (approx. 3-6%).
• Common Currencies:USDT(best liquidity),USDC(highest transparency),USAT(latest trend).

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Three Steps for Beginners: The Right Investment Path Starting with Stablecoins

📍 Phase One: Stablecoin Learning Period (1-3 months)

• Goal: Get familiar with the crypto world with zero risk.
• Action: Purchase with 1,000-5,000 NTDUSDT or USDC. Practice buying and selling, transferring, and checking market prices.
• Why? Prices don't fluctuate, no stress, and build the right understanding.

📍 Phase Two: Small Investment Period (3-6 months)

• Goal: Experience real investing with a small amount.
• Action: Invest 3,000-5,000 NTDto buy a small amount of Bitcoin, and set for long-term holding (1-2 years).
• Why? Losses are manageable, truly experience market fluctuations, and learn emotional management.

📍 Phase Three: Stable Allocation Period (After 6 months)

• Goal: Build a personalized long-term investment portfolio.
• Suggested Allocation(Beginners can start with a conservative type):
  • Conservative: 70% stablecoins + 25% Bitcoin + 5% Ethereum
  • Moderate: 50% stablecoins + 35% Bitcoin + 15% Ethereum
• Core Principle: Regardless of the type,keep at least 30% in stablecoinsas ammunition for hedging and buying opportunities!

‍※ The above suggestions are for reference only.

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Summary: Remember these 3 key points to avoid common pitfalls

1. Bitcoin ≠ Stablecoins: It is "digital gold," with highly volatile prices, suitable for long-term investment.
2. Ethereum ≠ Stablecoins: It is "blockchain fuel," more volatile than Bitcoin, and suitable for advanced investors.
3. Only 'USD' stablecoins are stable: USDT and USDC are the 'digital dollars' you should use for learning, hedging, and trading.

Immediate Action Plan for Beginners:

1. Don't rush to buy Bitcoin! Start with stablecoins.
2. Download a Taiwan-licensed exchange(such as ZONE Wallet mentioned in the article), and use NTD to buy your firstUSDT or USDC.
3. Use this stablecoin to familiarize yourself with all operations, and once you have a clear understanding, then consider a small investment in Bitcoin.

Remember,stablecoins are your safe starting point; prioritize stability over profit to ensure long-term success in the cryptocurrency market.

Disclaimer: This article is for educational reference only and does not constitute investment advice. Cryptocurrency investments are high-risk, with extreme price volatility, and may result in the loss of your entire principal. Please assess carefully before investing.