Differences Between Cryptocurrency and Stocks

Differences Between Cryptocurrency and Stocks

Finding differences between cryptocurrency and stock trading decipher necessities of both financial trades. Firstly, traders look forward to updated pieces of information because it gives clarity about two distinct domains.

Based on the merit, investors can lock their future and subscribe to what interests them. If we differentiate both, then cryptocurrency is still a toddler, while stocks are veterans.

Share markets have seen the world change over the centuries, whereas, the digital currency is its byproduct. Let us find odds and disparities below:-

Major Difference Between cryptocurrency and stock trading

Historical difference 

Historically, both share a stark contrast. The first-ever stock market came into existence in 1602. Amsterdam Stock Exchange finds a place in the Guinness book of world records.

However, it took centuries before cropping up as one of the most excellent financial markets. Stock markets had to face a lot of resistance initially, due to its new concept then.

But cryptocurrency, despite the latest invention, it saw the light of the day. People showed instant interest in the technology, and the testimony to it is unprecedented.

Whereas, the inception of stock exchanges, it faced a lot of resistance due to the primitive era.

Technological difference

Four centuries ago, when stock exchanges dawned, everything happened on paper. Diaries, papers and account books (known by different names then).

However, it was tough to maintain them. There was a risk of losing the count of papers and calculations. Plus chances of cheating and malfunctioning was high. Moreover, tracking several accounts at a time was a mammoth task.

On the other hand, Cryptocurrency is the byproduct of the latest technology. It is a network created by powerful computers packed with evolved software.

And due to the significance, it is easy to tackle it. Buying and selling of cryptocurrencies have always been an easy task from day one. Also, security and safety are the force of reckoning these virtual currencies are boasting.

Although, today, things are different. Stock trade is happening with the tools of information and technology.

Possession and ownership of stakes

Afterall cryptocurrencies are a virtual thing with no background of assets. It is a computer-generated program, which is not present in a physical entity.

A trader can’t have a claim on an asset of a matter. So, there is nothing that an investor can touch or see. However, shares fall under the same category.

People own them in the form of derivatives or contracts. Although there are physical assets and properties attributed to a company that allocates shares.

An investor has a right over them. And if anything goes wrong or a company fails, people have ways to recover their money.

But if such a problem occurs with cryptocurrency, there is no way traders can get their money back. The absence of a physical entity looks worrisome in that case. On the recovering monetary end, this market falls short.

Process of transaction

While in conventional stock trading, it took a few days to several days before a trader could start trading. An investor had to open a Demat account and connect it with the bank by visiting the branch physically. However, things are changing quickly, but some archaic rules remain.

But cryptocurrency has the edge over other financial tradings. A person can start trading on any of the existing platforms by providing minimum details.

Because there is no centralised service provider or a physical entity to bank upon, everything happens on the internet. Hence, it is quick, and actions take place swiftly.

Timings for cryptocurrency and stocks

Globally, stock exchanges work by schedules and have week day-offs. In that stipulated time, fluctuation, investments, trading, buying-selling and other phenomenon takes place in markets. The reflux in the market is mostly for five days. There are six to seven hours, among which all speculation and hush-hush happen. Once the market closes for the day, all entries are cut short if they are for the intra-day.

But cryptocurrency is beyond time specific. It works all day and 365 days a year without a halt. The movement in the market is continuous, and traders from several countries get involved in it at a time. Thus, volumes are higher that promote positive result. There is excitement among investors to earn profits. Plus, a trader needs to be vigilant.

Risk of hacking cryptocurrency and stocks

Technology has its prons. And in the case of cryptocurrency, it is higher compared to others. The crypto platforms are always on the target of hackers. And once they hack it and transact any deal, there is no way to cancel it because of the absence of a governing body. An investor can’t even file a legal case against the theft. In 2017, investors lost more than 137 million Euros, and it could be more, provided non-reporting of crimes.

Whereas in share markets, there is a possibility of cheating, phishing and another malfunctioning. But due to a secure system and governing bodies, money lost get recovered in no time. Also, in recent times, no such mishappening has come in the picture. Every government in the world has put a legal striction and authority to regulate stock markets while cryptocurrencies are on their own all the time.

Security and insurance for cryptocurrency and stocks

A few stock markets in the world provide insurance to brokers and traders. It gives them security against losses. But cryptocurrency is bereft of such luxuries. The reimbursement facility in the former accentuates people to buy shares. But the crypto market does not boast of any such facility. A trader is own his/her own with no insurance to cover their insecurities.


In stock trading, an investor gets a share of the capital invested in the company after every financial year. It increases as the company performs well in the market. The amount of the dividend depends on the number of units purchased by a person.

However, there is no such scheme available in crypto trading. No matter how much a currency does well or plummets, there is no dividend policy. Therefore, the only way a trader can earn is through the performance of cryptocurrencies.


The investment in cryptocurrency depends on the popularity of the unit. Traders put their money on a currency based on the opinion of others because there are no physical fundamentals. So, it fairs well on recommendations. Sometimes, hype results in the momentum. Also, it is tough to predict the outcomes.

The popularity and performance of stocks depend entirely on their fundamental values. If the business of the company does well and its products, people cling on it quickly. A rumour doesn’t have a long-life here. People can make wild guesses that can be spot on or at least near.


Both financial markets are crucial to the world. Both have utilities, drawbacks and necessities attached with them. If we talk about crypto, it is bridging the world in one thread. Blockchain technology makes cryptocurrency valid. On the other hand, businesses and jobs are growing exponentially with the advancement in share markets. Cryptocurrency is slowly and steadily making its progress in getting accepted as a regular currency, replacing the notes. And the growth of share markets is essential to explore new dimensions of prosperity.

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