Stocks or cryptocurrencies: what to invest in now?


Types of cryptocurrency investments have grown in popularity over the past decade. But compared to traditional financial instruments, cryptocurrencies are risky to support an entire financial system due to the lack of regulation. In addition, no institution regulates their price. Their value responds to supply and demand.

Another factor to consider for investors: the volatility of cryptocurrencies is a characteristic of this technology, with large variations in value over short periods of time. The best illustration is Bitcoin, which is nevertheless one of the least volatile cryptocurrencies. Between November 2021 and June 2022, its price fell by almost 70%.

However, cryptocurrencies remain a serious type of investment. This is evidenced by their acceptance in the traditional financial sphere: the SEC in the USA approved in 2021 an ETF on Bitcoin. In Europe, the crypto exchange platform Binance registers with financial market regulators.

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Stocks vs Cryptos

A stock represents a share of the ownership of a company. When the value of the stock increases due to the success of the company, investors benefit. The higher the company’s sales and profits, the higher its stock should grow.

Stocks are also considered volatile. Between January and June 2022, Apple, which is the most traded stock in the world, lost 27%!

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Cryptocurrencies and stocks are both viable investment alternatives, but their roles in a portfolio are distinct.

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Cryptocurrencies are riskier and suitable for a performance-oriented portfolio exceptional. Equities are also performance-oriented, compared to bonds for example. However, the equity investor seeks to achieve more moderate and realistic performance.

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