What is the difference between Cryptocurrency and stocks?
The original goal for the creators of Cryptocurrency was for Crypto to one day become a currency that is as commonly accepted as cash and credit. Many people now associate Cryptocurrency with stocks, even though they’re completely different.
Let’s take a look at some of the differences between Cryptocurrency and stocks. You can use this information to learn more about Crypto, but it’s not financial advice and you should consider talking to a professional advisor of your choice before making important financial choices like buying or selling Crypto.
Difference: What you own
When you buy Crypto, you're given the rights to a certain amount of that virtual currency. Someday it may be possible to use Crypto in transactions as easily as other currencies, but today it’s primarily a store of value that you can hold onto or sell. By comparison, stocks are offered by companies as equity or ownership in that company.
Both Crypto and stocks can go up and down in value, so buying either one involves risk. However, Crypto has gained a reputation for sudden and drastic changes in value that can happen without warning. Stocks, on the other hand, are directly linked to companies that must publicly and regularly share how they’ve been doing and how they expect to do in the future. Investors can use that information to make informed decisions.
Difference: How they’re governed
Several different organizations regulate the London Stock Exchange to protect fair trade. By contrast there is no central organization like the Financial Conduct Authority regulating the crypto market. It's also not covered under the authority of the Financial Ombudsman Service, the European Consumer Center, or any UK or Luxembourg Financial Services Compensation Scheme.
Difference: Hours of operation
Barring exceptional circumstances, the crypto market typically runs 24/7 365 days a year. You'll see the price of cryptos change even as the clock strikes midnight on New Year's Eve. The stock market only works full-time on business days but takes nights, weekends, and designated holidays off.