Crypto vs. Stocks: Which is Right for You?

Crypto vs Stock

Deciding whether to invest in stocks or cryptocurrency is a big decision, whether or not you’re an experienced investor. Investors are always trying new ways to make more money, so it’s only natural you’d be considering something like Bitcoin. Of course, both investment options carry risk, but it’s up to you to decide how much risk you’re willing to take on. Here’s how you can decide whether to invest in crypto or stocks. 

Weigh the Risks

No investment is risk-free, but there are safer investments for investors. The stock market can crash, and companies can go out of business, but stocks can also soar and make you rich. Risk is an important factor when deciding whether or not to invest in anything.

Even though stocks carry risk, they’re typically the safer option because there are ways to determine whether a price will rise or fall. For example, you can look at a company’s stock price and how much it makes to understand whether or not a stock is a good investment.

Crypto investments aren’t something you can predict. The investment is based only on supply and demand, so you’ll only make money if you can trade crypto tokens for more than what you purchased them for. However, someone always has to be willing to pay more than you did for them.

Cryptocurrency is still new and hasn’t been widely adopted as an investment, which adds more risk because it can always be replaced by something else that’s trending.

Consider the History

Crypto History

You can always look to the past to try to predict the future, but you shouldn’t base future performance on history. However, it’s useful to look at how different types of investments have performed over the years. Cryptocurrency and crypto investing are still relatively new, but the past few years have provided some insight.

For example, cryptocurrency has had a volatile history, with prices drastically fluctuating, sometimes in just a single day. Crypto is one of the most volatile types of investments because it doesn’t have a centralized authority, which means it’s subject to drastic swings.

On the other hand, stocks can also be volatile, but there is more long-term potential, and they have a long history, which gives investors more confidence in their investments. Historically, the stock market has provided investors with a good return, but the same can’t be said for crypto. While you might hear success stories about individuals who got rich from investing in cryptocurrency, there are just as many, if not more, horror stories about investors who lost everything because they invested too much of their money.

Determine Your Timing

When you want to see a return on investment you should invest in crypto or stocks. If you have a relatively short timeline, then your asset is typically safer and will be there when you need it. Any volatile assets should be avoided if you quickly want a return on your investment. Both stocks and crypto are long-term investment strategies, so there’s no reason to invest if you’re going to pull out when you get cold feet.

The good news is that stocks are less volatile than crypto and better for investors who don’t obsess over what the market is doing; instead, investors should have a long-term strategy in mind.

If you want to quickly get a return on your investment, then you should avoid crypto. Instead, you should be the type of investor that can leave their money alone and wait for recovery when there is a drop in value. In addition, you should never be willing to invest more into cryptocurrency than you’re willing to lose. You can easily lose everything overnight if you’re not careful.

Consider Asset Management

Investing in anything is all about building and diversifying your portfolio. There’s no reason to invest in stocks or crypto when you can invest in both and diversify your portfolio while minimizing risk.

Even though crypto carries risk, it works best if it makes up only a small portion of your portfolio. Thus, all of your money should not be tied up in cryptocurrency. On the other hand, stocks have a track record for being great long-term investments, but a portfolio should be diversified with other types of assets as well.

Which is Best for You?

Based on the information we’ve provided, you might already know whether stocks or crypto are the better investment for you. Essentially, you’re a good fit for being a crypto investor if you want alternatives to more common assets, such as stocks. However, cryptocurrencies like Bitcoin should not be the majority of your portfolio. Instead, consider how much risk you can tolerate and the amount of money you’re comfortable losing.

Many people invest in cryptocurrency because they like the idea of having money that’s not regulated by any government or bank. However, keep in mind you’ll still have to keep track of your investments with tax software and pay taxes on any gains, just like you would with stocks.

Stocks are a great match for many different types of people, and they’re often the main focus of a portfolio. In addition, stocks are a more stable investment, even though they might have short-term volatility.

Ultimately, investing in cryptocurrency can diversify your portfolio because they don’t have a price correlation with the stock market. If you’re a believer in the shift to cryptocurrency usage becoming widespread, then it makes sense for you to invest. However, make sure you never invest or sell your tokens based on what everyone else is doing. Cryptocurrency is trending, which means more people are currently buying in, but if the trend fades, then you could be left with nothing.

Final Thoughts

Some investors enjoy taking a walk on the risky side, which is why investing in bitcoin may sound like a great opportunity. However, the main thing you consider should be your risk tolerance. If you’re someone who doesn’t like to take on too much risk, then you’re better off investing in stocks.

Cryptocurrency has been in the news a lot lately, which is making investors want to take more risks. However, it’s important not to buy into something just because everyone else is. Instead, understand what you’re investing in and decide how much risk you can handle within your portfolio.

Matt Casadona


Matt Casadona has a Bachelor of Science in Business Administration, with a concentration in Marketing and a minor in Psychology. Matt is passionate about marketing and business strategy and enjoys San Diego life, traveling, and music.

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