Before You Invest in Crypto, Know the Risks

Cryptocurrencies, like Bitcoin and Ethereum, are different from stocks and real money. Crypto is not regulated like stocks or insured like real money in banks. Crypto’s high risks can offer big rewards or huge losses. A cryptocurrency is a digital currency, which is an alternative form of payment created using encryption algorithms. The use of encryption technologies means that cryptocurrencies function both as a currency and as a virtual accounting system. To use cryptocurrencies, you need a cryptocurrency wallet.

Fidelity Crypto® is offered by Fidelity Digital Assets®.Investing involves risk, including risk of total loss.Crypto as an asset class is highly volatile, can become illiquid at any time, and is for investors with a high risk tolerance. Crypto may also be more susceptible to market manipulation than securities. Crypto is not insured by the Federal Deposit Insurance Corporation, the Securities Investor Protection Corporation, or any other government agency, and is not an obligation of any bank. Cryptocurrencies are still relatively new, and the market for these digital currencies is very volatile.

Get more out of crypto

Examples include web-based, mobile, and desktop wallets. Cold wallets keep your private keys offline and out of reach of online threats. Past performance is not indicative of future results. Any investment in blockchain assets involves the risk of loss of part or all of your investment. The value of the blockchain assets you swap is subject to market and other investment risks. Bitcoin uses peer-to-peer technology to operate with no central authority or banks; managing transactions and the issuing of bitcoins is carried out collectively by the network.

Crypto IRAs: What you need to know

In contrast, non-custodial wallets, like Ledger’s, enable you to fully own and control your crypto. A crypto wallet stores your private keys and gives you access to your assets. The public key can be compared to a bank account number that you can share with third parties to receive crypto without worrying that your assets will be compromised. Securely manage and swap crypto in Exodus with your Ledger and Trezor hardware wallets. And while index funds don’t guarantee profits (no investment does), they are less risky and more appropriate for most investors. Crypto wallets come in many forms, from hardware wallets, like Ledger’s, to mobile apps that you can download on your phone or tablet.

Finally, since you store your cryptocurrencies in a digital wallet, if you lose your wallet (or access to it or to wallet backups), you have lost your entire cryptocurrency investment. Cryptocurrency, or crypto, is virtual or digital assets purchased with real money ($, £) traded on blockchain technology. It does not have all the values of real or fiat currencies.

Market cap breakdown

• Examples include web-based, mobile, and desktop wallets.
• These wallets can be software that is a cloud-based service or is stored on your computer or on your mobile device.
• From Bitcoin and Ethereum to an ever-growing list of altcoins, cryptocurrencies have taken a new generation of investors around the world by storm.
• “Ledger makes cold storage downright easy. My NFTs land infinitely safer and I don’t have to feel as paranoid about connecting to new smart contracts.”

Faster trades with real time market and portfolio insights. Exodus users are responsible for storing their own recovery phrase. If the recovery phrase is lost, the user might not be able to retrieve their private keys.

Bitcoin is open-source; its design is public, nobody owns or controls Bitcoin and everyone can take part. Through many of its unique properties, Bitcoin allows exciting uses that could not be covered by any previous payment system. From Bitcoin and Ethereum to an ever-growing list of altcoins, cryptocurrencies have taken a new generation of investors around the world by storm. Fast-moving and volatile, this industry keeps participants, observers, and regulators on their toes.

“Ledger makes cold storage downright easy. My NFTs land infinitely safer and I don’t have to feel as paranoid about connecting to new smart contracts.” Reliable backup signers https://au.tech-narix.com/ to swap, stake and HODL at home or on the go. Build your knowledge with education for all levels. Get the latest Exodus news and product updates delivered straight to your inbox. Monitor prices, track performance, buy and sell, and swap between thousands of swapping pairs. Get assistance anytime with our dedicated support team.

Easily buy and sell crypto with your Fidelity Crypto® account. Stake your crypto in a few taps to passively earn rewards. Select market data provided by ICE Data Services. Copyright © 2026 FactSet Research Systems Inc.Copyright © 2026, American Bankers Association. CUSIP Database provided by FactSet Research Systems Inc. SEC fillings and other documents provided by Quartr.© 2026 TradingView, Inc.

You have probably read about some of the most popular types of cryptocurrencies such as Bitcoin, Litecoin, and Ethereum. Cryptocurrencies are increasingly popular alternatives for online payments. There are different types of crypto wallets, each with its own benefits and drawbacks.Hot wallets are connected to the internet and usually convenient to use, however, they are also vulnerable to online attacks.