Should You Invest in Crypto Stocks Right Now? – Motley Fool

Should You Invest in Crypto Stocks Right Now? – Motley Fool

As Bitcoin (CRYPTO:BTC) continues its upward climb, many investors have their eyes on cryptocurrencies. Bitcoin has soared more than 77% since the beginning of the year. Dogecoin, another popular cryptocurrency, has skyrocketed more than 950% so far this year. With incredible run-ups like these, it’s becoming hard to ignore cryptocurrencies.

However, they aren’t the right investment for everyone. Although they have the potential to make investors a lot of money, they also carry a significant amount of risk. Before you invest in crypto stocks, here’s what you need to know.

Hand dropping Bitcoin token into a golden piggy bank

Image source: Getty Images.

What are crypto stocks?

First, it’s important to understand the difference between crypto stocks and cryptocurrencies themselves. It’s possible to invest directly in digital currencies, like Bitcoin or Dogecoin, by buying tokens. Or you can invest in a stock that’s heavily invested in cryptocurrency or is building the technology behind it. Some of these stocks include: