What risks are connected to cryptocurrencies?

It’s especially risks, you need to be aware of before you trade cryptocurrencies. There’s volatility, cyber-crime, and that crypto are unregulated assets without guarantees.

Volatility

Cryptocurrencies are very volatile assets. This means that the value of a cryptocurrency can rise and fall very dramatically. From one day to another, your money could become more than tenfold, just like you could lose the entire amount.

If you want to read more about volatility, and why cryptocurrencies rise and fall drastically, you can read more here .

Cyber-crime

When you trade cryptocurrencies , you can risk being deceived by cyber-criminals. Since September 2020, the Danish police has gotten reports on crypto-fraud, where the accumulated amount is about 20 million DKK, according to DR News.

This can happen following hacker attacks on personal computers, where IT-criminals force access to the computer, lock out the owner and blackmail them for money.

You could also risk trading cryptocurrencies on foreign platforms and websites, where fraud may happen. Therefore, you should always make sure to trade cryptocurrencies on credible platforms you trust.

Here you could choose to use Lunar Block - Probably Denmark’s most user friendly platform for buying and selling cryptocurrencies. 

Trade cryptocurrencies via Lunar Block - a Danish crypto platform

Unregulated assets without guarantees

Usually, your money is protected by a guarantee - In Denmark, an example of such guarantee is The Danish Guarantee Fund (Garantiformuen ).

If the money you have deposited in the bank were to disappear as a result of your bank going bankrupt, The Danish Guarantee Fund will cover your losses on up to 750,000 DKK. 

But for cryptocurrencies, there is no guarantee. Crypto is unregulated which also means that no central authorities can guarantee and protect the money you’ve purchased cryptocurrency with.

Read more about what it means that cryptocurrencies are unregulated here .

By how much have the different cryptocurrencies risen?

Here, you can see an overview of the most popular cryptocurrencies and their highest and lowest value according to CoinGecko . The numbers were retrieved in June 2022.

Is trading cryptocurrencies a good idea?

Before you consider trading cryptocurrencies, it could be a good idea to learn the most basic things about them. You can also learn more about what cryptocurrencies actually are, here .

And before you decide which cryptocurrencies to place your bets on, you could beneficially get wiser on each cryptocurrency’s features and ideas.