# Spot trading is really not that complicated, but newbies can easily fall into pitfalls.

Many people buy coins for the first time through spot trading - putting money into BTC and holding it in hand. It seems simple, but many people do not understand the difference between spot and leverage or futures, and as a result, they run into problems.

**What is Spot?** It is instant trading, you pay and I give you the coins, that's it. There is no borrowing to leverage, no contract date, you buy what you take. Platforms like Binance and Uniswap are all spot trading.

**The advantages are obvious**:
- The rules are simple and the risks are controllable. Invest 1000 USDT to buy BTC, and the maximum loss will be this 1000, no liquidation.
- Price transparency, determined by market supply and demand, without so many tricks.
- A good mindset. You don't have to stare at the market for fear of being forcibly liquidated; you can sell whenever you want.

**But there are also many pitfalls**:
- The ceiling on earnings is low. With only this much money in hand, that's all you can earn. Futures and leverage can use the same capital to pry larger positions, but spot trading cannot.
- Holding coins = self-custody. You are responsible for wallet security and private key backup, which can be quite troublesome.
- Large transactions are prone to slippage. If you want to buy 10 million BTC in one go, the market doesn't have that much liquidity, so you either need to buy in batches or go to an OTC desk.

**Key Difference**: Spot is T+0 (immediate settlement), futures are for future settlement; spot can only use the money you have, leverage can borrow money to amplify.

**Newbie Advice**: Start with Spot trading to understand the market rhythm, then consider other strategies. Without a solid foundation, using leverage is a recipe for disaster.