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In this wall, I will being giving an overview of the benefits and risks of both stocks and cryptocurrency through multiple trusted videos, websites, and images.

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Summary

Although stocks can be highly beneficial due to there higher potential of returns and the ability to make your portfolio your own, stocks are taxable and there's a possibility of a total loss on your investment.

Why I chose this

I chose this image as one of my images because I think it breaks down the pros vs the cons of stocks very well and a piece of information I didn't know was that stocks are taxable.

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Summary

Like everything in the world, cryptocurrency has its pros and cons. Crypto is super transparent and secure and also allows for global transactions but it has limited acceptance and is ambiguous.

Why I chose this

Again, I chose this image because of how simple the breakdown is allowing for you to obtain knowledge quickly while still getting a good understanding of the pros vs cons. I also didn't know that there is limited acceptance to cryptocurrency.

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How is this topic is relevant/interesting for me?

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How is this topic is relevant/interesting for me?

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As I get older and start to earn more money, its important that I look at ways to expand my wealth and grow my portfolio and stocks/cryptocurrency are great ways to do this if you have a good understanding of how they work. Learning the benefits/risks of these investments will help me make the right choice for myself in the future when the time comes to start looking into investing.

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What's the most important thing to pass on to a family member or friend about your topic?

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What's the most important thing to pass on to a family member or friend about your topic?

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I would say that the most important piece of information I could pass on is that both stocks and cryptocurrency are not definite ways of gaining wealth as both are fluctuating currencies and are not 100% safe although there are safer options than others. For example, investing in penny stocks is going to be way more risky than investing in a safer company like amazon but they will give you a higher ROI which is just apart of the risks.

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Summary

The article compares stocks vs cryptocurrency. Stocks have real value, are regulated and are more stable as they give ownership in the company your buying into whereas cryptocurrency is digital and doesn't really have regulations making them more risky and unpredictable than stocks

Why I chose this

I chose this article because it highlights the main differences between stocks and cryptocurrency. It talks about how stocks are a more safe and stable option compared to crypto that's less secure and unpredictable. It really outlines the differences to help you make a choice between the both of them. Also I learned that when purchasing stocks, you're buying ownership in the company.

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Stock Market vs Cryptocurrency: Differences, Benefits & Risks

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Learn about the differences between stock market vs cryptocurrency investments and the benefits & risks of each, with smallcase!

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Summary

This article compares the investment options between stocks and crypto. Crypto is seen as more risky as the value can change quickly and are not backed by the government compared to stocks that normally growth slowly and steady over time if you invest in a safe company. Stocks tend to be the safer option but crypto can give you a higher return or a bigger reward but is much more risky.

Why I chose this

This article does a great job explaining the differences between the two options if you were unsure in what to invest in. it helps you decide which is better for your goals by showing the risks and benefits to both which I think is very beneficial. I learned that stocks are government backed to ensure security while investing.

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Investors have always had many choices, but the market recently gained another option. Traditional choices such as stocks, bonds, real estate, and business ventures have been joined by cryptocurrencies. Let's see how crypto investments compare so far to the time-honored stock portfolio.

Image source: Getty Images.

What is crypto vs. stocks about?

Cryptocurrencies have generated massive interest from investors in recent years. Trading volumes and token prices skyrocketed in 2017, backed down for a couple of years, then surged again in 2020. Near the latest peak in November 2021, Bitcoin ( BTC -0.02% ) sported a market cap of $1.2 trillion, while Ethereum ( ETH -0.55% ) tokens were worth a total of $540 billion.

The sudden and dramatic changes in cryptocurrency prices can be exciting. On a good day, the crypto market can look like a successful get-rich-quick scheme, especially when you're looking at smaller and more volatile types of altcoins.

Then again, the peaks are usually followed by equally sudden crashes and corrections. Bitcoin and Ethereum have been around for years, but many of those ultra-exciting altcoins have come and gone, leaving investors disappointed.

A number of these qualities also apply to stocks, of course. There are no sure things in any market, and you always have to accept some risk when you're putting your hard-earned cash to work in any type of investment. But there are some significant differences between investing in cryptocurrencies and investing in stock, and you should know what they are before you make the leap into crypto.

Crypto vs. stocks value

One fundamental difference between stocks and digital coins is that a stock represents ownership of an actual business. Stock investors can base their investment decisions on business results, cash reserves, growth prospects, and more.

The value of a cryptocurrency may eventually have similar qualities if and when people start to use them in real-world transactions and crypto-based applications, but that day is still not here. So far, the market value of a cryptocurrency basically comes down to supply and demand. Can you find someone who is willing to pay a higher price for your crypto coins than you paid when you bought them?

Crypto vs. stocks governance

The stock market has a long history with more than a century's worth of regulation and legislation baked into every transaction. There are firm rules for how you trade, own, and manage your stock portfolio. You can earn postgraduate degrees and have an entire career in just the taxation aspects of stock-based gains.

The cryptocurrency market doesn't have any regulatory framework. The U.S. government has several different agencies working up how crypto regulations should look in the long run, but they are just getting started. Should cryptocurrencies be subject to the same rules as the stock market? Are they more akin to fiat currencies such as the U.S. dollar, the euro, and the Japanese yen? Or are they a completely different animal that deserves a whole new rulebook? Maybe every cryptocurrency shouldn't be treated the same way because different digital coins come with different technology platforms and long-term goals.

The regulatory future for cryptocurrencies is up in the air, and many investors simply will not enter the crypto market until there's a clear rulebook in place.

Trading crypto vs. stocks

The basic experience of buying cryptocurrencies is not very different from buying a stock. You open an account with a crypto brokerage, transfer some money to that account, pick a cryptocurrency, and place an order with the brokerage. After a short break, you'll have some cryptocurrency tokens (or a fraction of a token) in your crypto wallet.

The gears may turn very differently behind the scenes, but the crypto-buying procedure should feel familiar if you've ever bought a stock. There are some differences, though:

Crypto brokers are likely to charge trading fees for each transaction -- a practice that most stock brokers ended in 2018 and 2019. For example, the popular Coinbase (COIN 2.85% ) platform charges a transaction fee of 0.6% on crypto purchases of less than $10,000.

A stock transaction can be performed very quickly, to the point where algorithmic trading systems can close a deal in a few microseconds. Crypto trades are slower because each new transaction must be approved and verified by the digital currency's blockchain network -- a process that typically takes about 15 seconds for Ethereum trades and several minutes on the Bitcoin network.

Unless you insist on a printed stock certificate, your stock broker will act as the custodian of your stock-based holdings. That's not always the case for cryptocurrencies, where some investors insist on removing their digital coins from the centrally managed brokerage platform in favor of a cold wallet in their own possession.

Crypto advantages vs. stocks

Crypto coins can run extremely hot, skyrocketing at the drop of a hat. Since their valuation generally isn't held back by financial results (or the lack thereof) or other value investor concerns, the sky is the limit.

Many crypto investors hope to be among the first to put money into the next big thing before it takes off. The chances of hitting that winning lottery ticket may be small, but it could certainly happen. Other people prefer cryptocurrencies because of their decentralized nature, enhanced privacy features, high-powered automation options when the currency offers smart contracts, and other advanced options that no ordinary stock or currency can offer.

Crypto disadvantages vs. stocks

The lack of proper regulation adds an uncomfortable amount of risk to the crypto market. Until Congress figures out how to manage a newfangled class of digital assets, many investors will stay away for good reason. In particular, institutional investors won't capitalize the fledgling market until they know how the government will tax the gains and how regulators will address fraud in cryptocurrency trading systems.

The slow transactions can also be an issue for some traders. Soaring crypto prices can come crashing down just as quickly.

How can you be sure that both your cryptocurrencies and your crypto brokerage are safe from hackers? And what if you download your crypto holdings to a safe local wallet -- and then forget the password? These things have happened in the past, and they may very well happen again.

Investing in crypto vs. stocks

Simply put, you are likely to lose much more sleep worrying about the security of your cryptocurrencies than you ever did worrying about your stock portfolio.

If you are an experienced stock owner, you may want to add some crypto to your portfolio, but you should do that in small nibbles and make sure that you're learning everything you can about the crypto market before taking that step.

If you don't have any investing experience at all, you shouldn't jump straight into the deep end of the pool. You'll be better off learning the fundamentals of investing and long-term thinking in the stock market.

You can dip your toes into the crypto opportunity without even opening a crypto brokerage account. Many well-respected companies are exploring the cryptocurrency phenomenon from a variety of unique angles, with the added fall-back security of a serious business operation. Investing in these companies is probably the best place to start thinking about crypto investments for most people.

Related investing topics

What does the future look like for crypto and stocks?

The cryptocurrency sector's quirks, challenges, and opportunities will change over time. Regulations are on their way, but it's too early to tell what the final regulatory structure and the future of cryptocurrency will look like. Meanwhile, the stock market continues to evolve more slowly, having dealt with the bulk of its growing pains many decades ago.

So until further notice, stocks are inherently safer than cryptocurrencies, and the stock market's calmer waters can still generate life-changing wealth over time. You should keep your crypto exposure small for now, keeping in mind the speculative nature of these exciting but largely unproven opportunities.

Lyle Daly has positions in Bitcoin and Ethereum. The Motley Fool has positions in and recommends Bitcoin, Coinbase Global, and Ethereum. The Motley Fool has a disclosure policy.

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Crypto vs. Stocks: What Should I Invest In? | The Motley Fool

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Should you invest in cryptocurrency or stocks? Find out the advantages and disadvantages of each so you can choose wisely.

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Summary

the article compares main differences between cryptocurrency and stocks. Cryptocurrency is highly unstable and high risk but offer a high reward if you're successful whereas stocks are more stable and are a long-term investment but grow slowly leaving you with a smaller return on your investment in the short term. Overall stocks are a safer option but crypto will give you a higher return due to the bigger risk.

Why I chose this

I chose this article because I think it gave me a better understanding of the key differences between crypto and stocks. It explains the risk vs reward factor very well and would definitely help me make a choice between the two if I was trying to decide on which to invest in. I learned that crypto is highly unstable but due to this, there ROI is higher which might be a good choice for some but not others.

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While crypto and stocks do indeed share certain characteristics, they are fundamentally different.

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What did you learn about your topic that surprised you the most?

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What did you learn about your topic that surprised you the most?

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I was surprised to learn that when purchasing stocks, you're actually buying a portion of the company you're buying into. I've never really looked into any type of investing so I wasn't really sure how it worked but I found that quite interesting.

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Summary

The articles compares the risks and benefits of both, stocks and cryptocurrency. Crypto is risky, unpredictable, isn't regulated, can end in significant loss but also in significant gain. Stocks on the other hand are regulated, and represent a percentage of ownership in the company. These investments are normally considered safe, long-term investments that grow steadily over time.

Why I chose this

This article helped expand my knowledge on the risk factors of crypto vs stocks. When I have some more financial freedom, I would like to start investing myself so this website helped me make my options more clear and helped me guide a path into which one I think I'd like to start investing in myself. I also learned that cryptocurrency is unregulated which I thought was very interesting.

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More info

Cryptocurrency has taken the world by storm, especially during the last few years. The total value of all these digital currencies has swelled to about $2 trillion, says Bloomberg. Of these, Bitcoin is the most popular, worth more than $800 billion itself, according to CoinMarketCap.com. Investors have swarmed to this digital gold rush, often with little knowledge and a lot of hope.

Cryptocurrency's rapid appreciation has many investors questioning the place of stocks in their portfolios. But there are numerous differences between stocks and cryptocurrencies. The most important is that a stock is an ownership interest in a business (backed by the company's assets and cash flow), whereas cryptocurrency in most cases is not backed by anything at all.

If you're buying cryptocurrencies, it's important to understand what you're purchasing and how they compare to traditional investments such as stocks, which have a solid long-term track record.

Should you invest in cryptocurrency or stocks?

Any savvy investor needs to know exactly what they're investing in. It's crucial to weigh the risks and rewards of investing, and what will drive the investment's success. If they don't have this kind of information, they can't make the calculation. In this case, it's not really investing - it's much more like gambling.

Here are the key things investors need to know about stocks and cryptocurrency.

Stocks

A stock is a fractional ownership interest in a business. It's easy to lose sight of this, if you become overwhelmed by the wiggling stock prices - and the potential for profit. As a legal ownership stake in the business, the stock gives shareholders a claim on the assets and cash flow of the business. These back your investment and provide a basis for its valuation.

Why stocks rise and fall: A stock price moves as investors assess the future success of the company. While investors may become overly optimistic about the stock in the short term, the stock price ultimately depends on the company's ability to grow its profits over the long term. That is, a stock rises in the long term due to the success of the underlying company.

For a stock to be a successful investment, the underlying company must perform well over time. (Here's a step-by-step guide for how to invest in stocks.)

Cryptocurrency

Generally, cryptocurrency is backed by no hard assets (specialized stablecoins being an exception), and that's the case for the most popular crypto coins such as Bitcoin and Ethereum. A cryptocurrency may allow you to perform certain functions, such as sending money to another person or using smart contracts that automatically execute after specific conditions are met.

Why cryptocurrency rises and falls: Because cryptocurrency is not backed by assets or cash flow, the only thing moving crypto prices is speculation driven by sentiment. As sentiment changes, prices shift - sometimes drastically. So cryptocurrency is driven only by the hope that someone will buy it for more in the future - what's called the "greater fool theory of investing."

For a cryptocurrency to be a successful investment, you must get someone to buy it from you for more than you paid for it. That is, the market must be more optimistic about it than you are. (Check out this beginner's guide to investing in cryptocurrency.)

Pros and cons of investing in cryptocurrency vs. stocks

Pros of investing in cryptocurrency

Possible hedge against fiat currency: For some investors, one of the biggest appeals of cryptocurrencies is its decentralized nature. It's not controlled by central banks or governments who like to print money and generate inflation in fiat currencies such as the U.S. dollar or the euro. Cryptocurrency has been called "digital gold" by some investors who hold it because they think it will protect them from inflation.

Potential for outsized gains: Buying cryptocurrencies creates the potential for large gains on your investment. Several cryptocurrencies have seen their prices skyrocket since first being introduced. These gains are the main reason people are attracted to cryptocurrencies, but the potential for price appreciation comes with significant risk.

Growing number of coins: In the early days of cryptocurrencies, there were just a few coins that could be invested in, but the speculative interest has changed that. New coins are introduced regularly and there are now thousands to choose from.

Wide interest in digital currencies: There seems to be a growing interest in cryptocurrencies from investors, companies and governments. Tesla holds Bitcoin on its balance sheet and briefly accepted the digital currency as payment before reversing course. El Salvador adopted Bitcoin as legal tender in 2021, though the International Monetary Fund has urged the country to reverse its decision. Increasing acceptance of digital currencies could be positive for investors.

Cons of investing in cryptocurrency

Extreme volatility: Cryptocurrencies have been extremely volatile so far in their relatively young existence. They aren't backed by anything, so the price they trade at is determined by the whims of traders. Fortunes can be made and lost quickly and there's no telling where a coin might trade next.

Cybersecurity risks: Despite cryptocurrency enthusiasts touting the security benefits of digital coins, there have been notable hacks involving cryptocurrencies. It is often difficult to recover stolen funds.

No intrinsic value: Cryptocurrencies have no intrinsic value, which means they aren't backed by underlying assets or earnings the way that stocks are. Stocks have value because of their future earnings power and what they will return for their owners, while cryptocurrencies offer nothing of the sort.

Regulatory risks: While El Salvador has embraced Bitcoin, many governments are much more skeptical about cryptocurrencies. China has banned them altogether and other countries could follow suit.

Pros of investing in stocks

Long history of solid returns: Stocks have a long track record of producing solid investment returns, with the S&P 500 returning about 10 percent over the long-term. Though stocks can be volatile in the short term, they have generally been safe to hold over long periods of time.

Have intrinsic value: A stock represents an ownership interest in a company and its value over time depends on the success of the underlying company. Companies own assets that produce earnings and cash flow for investors, creating what's known as intrinsic value.

Accessible: It is easier than ever to invest in stocks these days with many online brokers cutting trading fees to zero. You can invest in individual stocks or choose to purchase a diversified basket of stocks through an index fund. Index funds help keep costs low and you can build a diversified portfolio even if you don't have much money to start with.

Stronger regulation: Stock exchanges, brokers and companies are all heavily regulated through various government agencies. Companies are required to provide certain information to investors through the Securities and Exchange Commission. No regulatory body is perfect, but stocks have been around for a long time and there are certain investor protections in place.

Cons of investing in stocks

Volatile: When you hold a broad basket of stocks through index funds, stocks are less volatile than cryptocurrencies. Individual stocks can be more volatile, but typically less so than cryptocurrencies. Because of this volatility, stocks are best held as part of a long-term investment plan, so you have time to recover from any short-term losses.

Lower potential for extreme gains: Broad stock indexes like the S&P 500 likely have less potential for the extreme gains that can sometimes be found among cryptocurrencies. Stocks have returned about 10 percent over the long term, whereas it's not uncommon for cryptocurrencies to move 10 percent in a single day.

Other considerations when investing in stocks vs. crypto

Time horizon

Your time horizon - when you need the money from an investment - is a key criterion. The shorter your timeline, the safer your asset should be, so that it's there when you need it. The more volatile an asset, the less suited it is for those with a short timeline. Generally, experts suggest investors in risky assets such as stocks need at least three years to ride out volatility.

Stocks

Stocks are often volatile, but they tend to be less volatile than crypto. Individual stocks are more volatile than a portfolio of stocks, which tends to benefit from diversification.

Stocks are better suited to investors who can leave their money alone and don't need to access it. Generally, the longer you can leave it invested, the better.

Some stocks can be more volatile than others. For example, growth stocks tend to fluctuate much more than value stocks or dividend stocks.

Investors may shift from more aggressive stocks (growth stocks) to safer ones (dividend stocks) as they need to tap their money, such as when they approach retirement.

Cryptocurrency

While stocks are volatile, cryptocurrency is ridiculously volatile. For example, during 2021, Bitcoin lost more than half its value in a few months and later gained 100 percent. Such volatility makes crypto unsuited for short-term investors.

Crypto is better suited to traders who can leave their money tied up and wait for it to recover. Think years rather than weeks.

Portfolio management

As you're thinking about constructing your portfolio, you don't have to make an either-or choice between cryptocurrency and stocks - or other kinds of asset such as bonds or funds, either. It's all about weighting your portfolio in a way that fits your risk and time horizon.

Cryptocurrency

Given its inherent risks, cryptocurrency works better with a small allocation in your overall portfolio. Think 5 percent or less.

Even a small allocation could do wonders for your portfolio if cryptocurrency really takes off. Also, limiting to a small allocation protects you against a complete loss if crypto goes nowhere.

If crypto grows to be a significant portion of your portfolio, you can re-allocate more of your money to stocks to lower your portfolio's overall risk.

Stocks

Given stocks' strong long-term record, a diversified collection of stocks should make up the majority of your portfolio, especially if you have decades until you need to tap it.

If you're investing in individual stocks, you'll need to research your stocks carefully to achieve good returns.

If you're investing in funds, you can buy a broadly diversified fund such as an S&P 500 index fund without significant research and enjoy the potential for high returns.

Bottom line

Some cryptocurrencies have soared in price since being introduced over the past few years, but investors need to understand what they're investing in, instead of just rushing in because other traders are. If you decide to take a stake in crypto, consider how it fits with your own risk tolerance and financial needs. Investors can earn good returns without investing in cryptocurrency, and some investors, including legends such as Warren Buffett, won't touch cryptocurrency.

Learn more:

Editorial Disclaimer: All investors are advised to conduct their own independent research into investment strategies before making an investment decision. In addition, investors are advised that past investment product performance is no guarantee of future price appreciation.

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Cryptocurrency Vs. Stocks: What's The Better Choice For You? | Bankrate

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More info Cryptocurrency has taken the world by storm, especially during the last few years. The total value of all these digital currencies has swelled to about $2 trillion, says Bloomberg. Of these, Bitcoin is the most popular, worth more than $800 billion itself, according to CoinMarketCap.com.

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Summary

The video talks about the importance of knowing the what you're buying into before making a decision. He compares it to a weather report and basically saying that you wouldn't go to the beach without checking the weather so why should you purchase stocks or cryptocurrency without doing more research on them first.

Why I chose this

I chose this video because I also feel like its important to make the right decisions when choosing things like these and doing a further back round check on the differences and risks/benefits to each could be the difference to if you make the right call or wrong call. I learned that there are people and websites out the to help you make the right decision and help limit the risks when buying in.

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Stocks vs Crypto - Which Should You Invest In?

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Summary

The video compares stocks vs crypto and the key differences from each. Stocks usually are going to be a more safe option as you're buying into a company and are pretty understood as they've been around for years whereas crypto is usually seen as a more risky option since it hasn't been around for long and really has no government backing making it more volatile.

Why I chose this

I chose this video because although he isn't a financial advisor, he is an investment writer so he definitely has plenty of knowledge on each of this subjects. He explains the differences and risks between the two very well and definitely helped grow my understanding of each of them. I learned that there are people that have jobs such as stock brokers who's job it is to help you grow your portfolio successfully and make sure you're making the right decisions when it comes to choosing the right thin to invest in.

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Stocks vs Crypto: Understanding Different Types of Investments | NerdWallet

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Summary

This video dives a little deeper on comparing stocks vs crypto and which might be the better option for you. Stocks are going to be the safer option for long-term success whereas crypto can turn a quick profit but is much much riskier. The key takeaway is that stocks are tied to companies performance compared to crypto that relies on the market sentiment, technology, and adoption.

Why I chose this

I chose this video because he does a great job at really simplifying the risks and differences and helped me get a better understanding on investing and which type might be better options for others. I learned that cryptocurrency provides more trading flexibility and accessibility than stocks.

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Difference between Cryptocurrency and Stocks

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Summary

This video talks about how to properly invest and how to make the right decisions when it comes to picking what you invest in. It's important to not limit yourself to just one investment since if this stock or cryptocurrency crashes, you'll be left with nothing. Although cryptocurrency is widely known to be more risky than stocks, there are still safer options in these types of investments. For example, something like bitcoin or ethereum is a pretty reliable coin to invest in. although these do fluctuate, they are relatively safe as they continue to grow.

Why I chose this

I chose this video because it was the first source that kind of highlighted the positive side of cryptocurrency. Although other sources weren't necessarily saying crypto is bad, they tended to focus on the negative whereas he tried to show the good in it by showing his profits and explaining how to properly invest into it. I learned that its smart to keep your options open and to try to invest in as many smart options as you can so you're not left at a complete lose if you're stock or coin crashes.

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Crypto vs Stocks:The Best Retirement Investment (Tested)