How different is crypto trading from stock trading?


Stocks and cryptocurrencies are two very different kinds of investing tools. While both are liquid assets that should be included in your speculative portfolio, the similarities end there. These are two very different types of securities that should be maintained in separate portfolios.

What are Cryptocurrencies?

A cryptocurrency is defined as a type of digital asset that only exists on the internet. It has no physical components and simply exists as entries in an online ledger that maintains ownership. The US dollar, on the other hand, includes a physical as well as a digital component. The unit of a cryptocurrency is referred to as a token, just like the unit of a stock is referred to as a share.

What Are Stocks?

Stocks are a publicly traded company’s ownership shares. Each share of stock you buy gives you a percentage ownership in the company. A corporation’s ownership is proportionate to the number of shares it has issued.

Assume ABC Corp. sells 50 shares of stock in exchange for a 50% stake in the company. You will own 1% of ABC Corporation if you buy one of these shares of stock.

Major differences

There are substantial differences between investing in cryptocurrencies and equities. Some of the most noteworthy differences, though, are as follows:


Stocks and cryptocurrencies both provide a variety of investment options. The combined listings of the NYSE and the NASDAQ gave investors access to almost 6,000 companies. Several cryptocurrency exchanges are also giving 10,000 to 12,000 prospective cryptos.


The most volatile of assets you can invest in is cryptocurrency. This is true of both individual assets and the whole market. Whether you buy Bitcoin or an altcoin, crypto is a roller coaster ride. Assets might rise in value one day and then drop in value the next.

Stocks are less volatile than bitcoin, but they are not intrinsically stable. Until crypto, shares in a single company were widely considered the most volatile investments available. The stock market, despite the unpredictability of individual assets, is reasonably stable and predictable. It advances slowly in general, to the point when large stock market fluctuations make the news.


Stocks are among the most heavily regulated assets on the market. The Securities and Exchange Commission (SEC) monitors public shares and the markets where they are traded on a regular basis. It is important to note that regulation applies even for investors using apps for trading, so if you’re looking for the best trading app in South Africa, consider one that guarantees utmost peace of mind.

There is currently no centralized cryptocurrency exchange system. Instead, users can trade cryptocurrencies among themselves through a network of hundreds of small exchanges run by autonomous groups. Despite the fact that a few more popular bitcoin exchanges dominate coverage, there are no really dominant firms in this market.

So, which asset do you think you should invest in? Cryptocurrency is a volatile, boom-and-bust asset that has generated a lot of buzz in a short amount of time. If you’re interested, just put your most speculative money into it, money you’re willing to lose. Individual stocks are determined by the performance of the underlying company, which influences the stock’s price. These investments are still risky and volatile, but not as much as cryptocurrencies.