Cryptocurrencies inspire passionate opinions, from those who believe they’re a transformational technology to those who worry they’re just a fad. Whatever your view, it’s important to be aware of the risks and rewards.
There are many different types of cryptocurrencies, but they generally fall into one of four categories: utility, transactional, governance or platform. Each serve a particular purpose on their respective blockchains, and they’re all available to trade on the crypto market.
Cryptomarkets are very different to traditional financial markets, offering a unique research opportunity for investors and regulators alike. They feature non-stop trading and a lack of regulatory oversight, making them a fertile ground for testing theories on price formation and stabilization.
The cryptocurrency market is highly volatile, and prices can rise or fall by large amounts in a short period of time. This makes it an exciting, but risky investment area for traders, and you should only invest money that you can afford to lose. Diversification is key, and we advise you to trade cryptocurrencies with IG using CFDs – leveraged products that enable you to speculate on whether a currency will rise or fall without owning the asset itself.
When it comes to researching cryptocurrencies, the best place to start is by looking at how much people are spending on them and what they’re buying with them. It’s also worth checking out how the project is funded. Reputable cryptocurrencies are usually publicly traded, and you can see details like how many coins were issued in the initial token sale, or who’s backing it.