Cryptocurrency
Digital assets with high volatility and evolving regulation.
Crypto combines market risk with infrastructure risk
Cryptocurrency prices can move sharply, but price volatility is only one part of the risk.
Investors also need to understand custody, wallet control, exchange structure, network mechanics and what happens if an intermediary fails. Owning an asset directly in a wallet is operationally different from holding it through a brokerage, exchange, trust or exchange-traded product.
Those structures should not be treated as interchangeable simply because their prices reference the same cryptocurrency.
What to compare
Start with the exposure itself: direct ownership, fund exposure or a derivative.
Then compare custody, transfer rights, trading costs, spreads, liquidity and the protections that apply to the account. A convenient trading interface can obscure meaningful differences in who holds the asset and what legal claim the investor actually owns.
Common mistakes
- ×Leaving long-term holdings on an exchange instead of understanding custody
- ×Sizing a position without deciding in advance how much loss is tolerable
- ×Treating staking yield as risk-free income
- ×Overlooking that every disposal is a taxable event