Investing Archives | Page 156 of 221

Sep

2022

Crypto vs Stocks: 8 Key Differences Traders Should Know

By Colin Dodds | Growing Wealth, invest, Investing | Comments Off

Whether to invest in crypto vs. stocks may sound like a crazy debate to longtime traders and investors. The two asset classes couldn’t be more different — in terms of how they’re structured (one is digital, one has real-world value), how volatile they are (crypto’s swings can be more dramatic), where you store these assets, and more.

So, is crypto better than stocks — or are stocks better than crypto? Each one offers its own compelling set of opportunities, as well as risks. For new traders considering investing in crypto, here are some things to review as you enter the crypto vs. stocks debate.

Stocks: A Quick Review

When thinking about the difference between crypto and stocks, the first point to remember is that a share of stock represents a percentage of ownership in a tangible, brick-and-mortar business.

While stocks and whole sectors go in and out of fashion with investors, the stock itself still corresponds to a portion of a functioning company, with a price that reflects the value of that company. By contrast, cryptocurrencies are wholly digital, and that impacts their value, their real-world viability, and how they are traded.

💡 Recommended: What Is a Stock? A Closer Look

Cryptocurrency: A Quick Review

Cryptocurrencies are types of digital assets that are created and stored digitally, using blockchain technology.

The main difference between crypto vs. stocks is that stocks are a share of ownership, while cryptocurrencies don’t have any intrinsic value, unlike fiat currencies. Fiat currency, like the U.S. dollar, is money that’s issued and backed by a central bank or government. Cryptocurrencies are wholly digital, and are not issued or overseen by a government, bank, or any other central authority.

And because they’re super volatile, most types of crypto aren’t currencies in the traditional sense. Their real-world value as a means of purchasing goods and services is limited right now.

The value of a cryptocurrency reflects a variety of factors, including current supply and demand for that currency. In some cases, it also reflects a faith in the underlying technology that powers the currency, or a particular innovation that a certain crypto stands for.

💡 Recommended: What Is Cryptocurrency? A Beginner’s Guide

8 Major Differences Between Crypto and Stocks

Cryptocurrencies and stocks are very different assets. Here’s a look at some of the characteristics that set them apart.

1. Ownership

To purchase and own stock, you typically need a brokerage account to handle the transaction. That account is verified by information like your address, Social Security number, signature and more. This offers some protection in the event of identity theft or fraud.

Cryptocurrency offers more anonymity, but less security. You keep your coins or other digital assets in a crypto wallet, which can be fully virtual or it can exist on a USB drive. That anonymity may create unique risks, such as losing crypto to hackers or forgetting your password and losing access to your account. Or you could misplace your USB drive, and lose all your crypto.

💡 Recommended: How to Find Lost Bitcoins and Other Cryptos

2. Exchanges

Stock exchanges have existed in some form or another for more than three centuries, most famously on Wall Street, in New York City. Cryptocurrency exchanges, on the other hand, are fairly new. The largest one, Binance, launched in 2017. Coinbase, another major player, was created in 2012.

Binance had a daily trading volume of about $76 billion, as of August 2022. At the same time, the Nasdaq, which is just one small part of the global stock market, had a trading volume that was nearly three times that amount. And the Nasdaq is only 14.5 % of the total stock market by some estimates.

3. Liquidity

Smaller markets also affect the ability to trade in and out of your investments, whether they’re stocks or cryptocurrencies. That ability to trade at will is called liquidity. Investors typically consider stocks highly liquid, since there are so many active traders in the stock market.

With cryptocurrency, on the other hand, liquidity varies quite a bit from one form of crypto to another. Bitcoin is more liquid than most cryptocurrency, simply because it has a higher trading volume. That means there are more buyers and sellers who want to trade if you want to get in or out of that particular cryptocurrency.

Both stock investors and crypto investors can fall victim to slippage, which involves losses when you have to sell a large amount of an asset during a period of low liquidity. However, the risk is higher for crypto owners, given the lower levels of liquidity in the crypto markets.

4. Volatility

There is volatility and risk involved in buying both crypto and stocks. Both assets can go up or down in value, and it’s nearly impossible to time the market to know exactly the best time to buy or sell.

While the stock market has a well-earned reputation for volatility, the broader market has tended to go up over the course of decades, with an average total return of about 10%. Since past performance is no guarantee of future returns, and public stocks must publicly report on their finances, investors have access to several sources of information to make decisions about purchasing those securities.

On the other hand, cryptocurrency is more likely to undergo sudden, drastic changes in value, sometimes without warning, leaving some to particularly wonder why crypto can be so volatile. Those swings can lead to potentially huge wins for crypto traders, but it can also create large losses in a very short period of time. More than 1,600 forms of crypto have vanished altogether in recent years. While it is possible for public companies to go bankrupt, they’re far less likely to lose all of their value than most cryptocurrencies are.

Get up to $1,000 in stock when you fund a new Active Invest account.*

Access stock trading, options, auto investing, IRAs, and more. Get started in just a few minutes.

*Customer must fund their Active Invest account with at least $25 within 30 days of opening the account. Probability of customer receiving $1,000 is 0.028%. See full terms and conditions.

5. Trading Costs

Every time an investor buys or sells stocks, they may have to pay transaction fees, such as commissions, that eat into their returns. Even investors who purchase low-fee, no-load index mutual funds — which are essentially baskets of stocks — have to pay fees that cover the costs of running the fund.

The costs of actively managed funds, and for trading through a brokerage account, may be higher.

The difference between stocks and crypto here isn’t substantial, because crypto trading can also come with substantial costs. Crypto exchanges charge fees. And there are “gas fees,” which are the costs extracted by a network for various transactions on the blockchain. Those fees vary widely from one form of crypto to another.

Some networks will raise the gas fees to speed up transactions. But by some estimates, the leading marketplaces charge at least 1.5% in fees to buy or to sell crypto. That will wipe out any gain under 3%.

6. Regulation

There are national agencies such as the Securities and Exchanges Commission (SEC) in the United States, which oversee stocks and stock markets. The regulation by those companies ensures a certain level of transparency into the publicly traded companies.

By contrast, cryptocurrencies remain largely unregulated.

That’s a benefit to some investors, who may have mixed feelings about government regulation. Decentralized networks run each cryptocurrency, with individuals focused on maintaining their technology and ensuring the integrity of the project.

Because the issue of crypto regulation is in flux, cryptocurrencies and exchanges remain at risk of facing drastic transformation or elimination. For example, a key debate in 2022 has been the question of whether crypto is a security or a commodity.

7. Trading Hours

The stock markets are usually only open during business hours in their home country, Monday through Friday, and closed on holidays on weekends.

By contrast, the crypto market runs around the clock, every day of the year. The 24/7 availability of the crypto markets may be one reason why crypto is so volatile. As decades of research on the stock market has shown, investors often succumb to emotional impulses that can drive their investment behavior. Time off can help restore a sense of control and order.

8. Diversification

Many investors aim to build a portfolio with diversified holdings that perform differently in different markets. In general, stocks often perform in correlation with the broader economy and are impacted by factors like inflation, unemployment rates, interest rates, and more.

Some proponents of cryptocurrency believe that it’s a non-correlated asset, meaning that this asset class doesn’t react to market events like traditional securities such as stock and bonds. Some also believe that it could act as a hedge against inflation, making it a valuable counterweight in a portfolio that has more inflation-sensitive assets.

Pros and Cons of Investing in Crypto

The question of investing in crypto vs. stocks comes down to the advantages and disadvantages of each, and what matters to your goals and risk tolerance.

Pros

Crypto is a new and, for some investors, an exciting asset class with many potential opportunities. It’s driven by cutting-edge technology, which is itself driving many new digital assets and innovations.

When the cryptosphere first launched with Bitcoin in 2009, it was considered an outlier. Now owning crypto is key to participating in nascent digital economies, like Web 3.0.

Cons

Speaking of sudden losses, one of the big disadvantages to investing in crypto is how vulnerable the technology can be to cyber attacks. Entire coins have been wiped out, billions of dollars have been lost (maybe more), and the truth is that until there are real crypto regulations on the books, those kinds of risks are going to be endemic to the crypto space.

The cost of owning and trading crypto is also unpredictable, thanks to the fluctuating costs on different exchanges and crypto networks. Just completing transactions on different networks can come with hidden costs.

Pros and Cons of Investing in Crypto
Pros	Cons
Potential for big gains	Potential for huge losses
Exciting new technology, essential for Web 3.0 and other innovations	Highly unregulated and vulnerable to cyber attacks
Opportunity to invest in new coins	Coins can lose value and disappear

Pros and Cons of Investing in Stocks

Stocks may seem old-school next to crypto, but after hundreds of years the stock markets aren’t going anywhere, and investing in stocks vs. crypto still offers some advantages (as well as some risks).

Pros

Investors who put their money into stocks enjoy the benefits of an asset class that’s long established and highly regulated. This also makes trading stocks simpler and more straightforward. It’s almost impossible to “lose” stocks you own, because of guardrails that protect investors, thanks to existing structures and regulations.

While stocks can be volatile and risky, overall stocks may be less vulnerable to hackers. Their value doesn’t hinge only on digital functionality, but the performance of an underlying entity — the company the stock represents. Therefore stocks have intrinsic value.

Cons

While the swings of the stock market still occur, some investors now handle that volatility by investing in stocks for the long term. You’re less likely to see wild gains in the stock market, the way you are with the crypto market.

Stock investors may not be as vulnerable to cyber attacks and hacks, compared with crypto investors, but there are plenty of vulnerabilities in the existing markets. The stock market is highly complex, and new securities and investment products enter the market frequently — think robo advisors, various derivatives, and more — with accompanying opportunities and risks.

Pros and Cons of Investing in Stocks
Pros	Cons
Wall Street is highly regulated, with many protections for investors	Investors may not have the same kind of opportunities for outsize gains
Stocks are less vulnerable to cyber crimes and hacks	The stock market is highly complex, and new products pose new risks
Stocks have intrinsic value

The Takeaway

Stocks and cryptocurrency couldn’t be more different. Stocks offer investors a tangible piece of ownership in a company (even if it’s a tiny fraction of that company), whereas crypto assets don’t have intrinsic value. They are wholly digital and decentralized, which means they’re not regulated by a central authority like the Securities and Exchange Commission, which is one of the many agencies that help oversee the stock market and keep it safe for investors.

That said, of course, cryptocurrencies are new and exciting investments that present many opportunities that stocks, being more traditional, may not.

To some degree, investors can benefit from investing in both stocks and crypto, especially these days. When compared with crypto, stocks now seem like a fairly steady long-term play. And investing in crypto is going to be necessary in order to take part in the growing global digital economies, like Web 3.0.

FAQ

Does cryptocurrency work like stocks?

No. Cryptocurrencies are bought and sold on crypto exchanges; the fees are unpredictable; and many types of crypto are so new they don’t have a track record, and it’s hard to establish their value. Stocks are well established and highly regulated securities that can be bought and sold via a traditional brokerage or app, in a variety of forms — including index funds and exchange-traded funds, and more.

Is crypto a better investment than stocks?

It depends on your priorities. If you’re looking for super high-risk, potentially high-return investments — and you’re willing to face big losses — crypto might be your bag. If you prefer a long-term investment with less risk and the potential for relatively steady average returns over time, stocks could be your friend.

How can crypto markets impact stock markets?

As of September 2022, what happens in the crypto markets seems somewhat correlated with what happens in the stock markets. Meaning, investors in each market are behaving similarly – as when the Fed raised interest rates, and both stock values and crypto values dropped. That said, it’s not clear that one market impacts the other, but that investors handle stocks and crypto in similar ways.

Photo credit: iStock/ljubaphoto

SoFi Invest®
INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE
SoFi Invest encompasses two distinct companies, with various products and services offered to investors as described below: Individual customer accounts may be subject to the terms applicable to one or more of these platforms.
1) Automated Investing and advisory services are provided by SoFi Wealth LLC, an SEC-registered investment adviser (“SoFi Wealth“). Brokerage services are provided to SoFi Wealth LLC by SoFi Securities LLC.
2) Active Investing and brokerage services are provided by SoFi Securities LLC, Member FINRA (www.finra.org)/SIPC(www.sipc.org). Clearing and custody of all securities are provided by APEX Clearing Corporation.
For additional disclosures related to the SoFi Invest platforms described above please visit SoFi.com/legal.
Neither the Investment Advisor Representatives of SoFi Wealth, nor the Registered Representatives of SoFi Securities are compensated for the sale of any product or service sold through any SoFi Invest platform.

Crypto: Bitcoin and other cryptocurrencies aren’t endorsed or guaranteed by any government, are volatile, and involve a high degree of risk. Consumer protection and securities laws don’t regulate cryptocurrencies to the same degree as traditional brokerage and investment products. Research and knowledge are essential prerequisites before engaging with any cryptocurrency. US regulators, including FINRA , the SEC , and the CFPB , have issued public advisories concerning digital asset risk. Cryptocurrency purchases should not be made with funds drawn from financial products including student loans, personal loans, mortgage refinancing, savings, retirement funds or traditional investments. Limitations apply to trading certain crypto assets and may not be available to residents of all states.

²Terms and conditions apply. Earn a bonus (as described below) when you open a new SoFi Digital Assets LLC account and buy at least $50 worth of any cryptocurrency within 7 days. The offer only applies to new crypto accounts, is limited to one per person, and expires on December 31, 2023. Once conditions are met and the account is opened, you will receive your bonus within 7 days. SoFi reserves the right to change or terminate the offer at any time without notice.

First Trade Amount		Bonus Payout
Low	High	Bonus Payout
$50	$99.99	$10
$100	$499.99	$15
$500	$4,999.99	$50
$5,000+		$100

SOIN0922057

Sep

2022

What Companies Accept Dogecoin and Other Cryptos as Payment?

Which Companies Accept Dogecoin and Other Cryptos as Payment?

By Matthew Zeitlin | Growing Wealth, invest, Investing | Comments Off

A growing list of businesses accept cryptocurrencies like Dogecoin as a form of payment, especially as crypto itself becomes more widespread and commonplace. Though Dogecoin is not as big or as popular as Bitcoin or Ethereum, it’s still gaining more and more acceptance among merchants and service providers.

That’s a list that includes airlines, professional sports teams, and many more.

Dogecoin Basics

Dogecoin, as of September 24, 2022, is valued at around $0.06, with a total market cap of more than $8.5 billion. While this may seem like a lot — and enough to put it in the cryptocurrency top ten, according to CoinMarketCap — it’s still relatively small compared to Bitcoin (valued at $19,000 with a $366 billion market cap) or Ethereum ($1,345, $164.4 billion). Yet, it’s still one of the top cryptos by market cap.

History of Dogecoin

Jackson Palmer created Dogecoin in 2013 as both a reference to the then-popular meme and to what was then seen as an explosion of interest in Bitcoin. In early 2018, during another huge runup in crypto prices, Dogecoin’s market cap reached more than $1 billion, which may have been seen as extreme at the time (it would fall back down to around $400 million), but was nothing compared to what was coming.

Between April and May of 2021, Dogecoin’s market cap rose from around $8 billion to almost $95 billion. After values dropped in 2022, it’s currently at around $8.5 billion. So, if you had hopes to see Dogecoin to $100, or to the moon, those hopes have likely been dashed for now.

💡 Recommended: Dogecoin Price History: 2013 to 2022

While traders can buy and sell Dogecoin like any cryptocurrency on mainstream exchanges like Coinbase, it does not have the buzzing hive of developer activity and use in businesses that others do. That’s slowly starting to change.

More than 240,000 people have signed a Change.org petition aimed at getting Amazon to start accepting the coin. While that request hasn’t gotten much traction, there are some businesses that have decided to start accepting it as a means of payment.

How Dogecoin Works

As for how Dogecoin actually works, it’s more or less the same as Bitcoin. Dogecoin is a virtual currency that lives on a blockchain network, operating off of a proof-of-work protocol. That means that participants on the blockchain network can mine new coins.

Transactions are verified and recorded on the blockchain, and new coins are produced, or mined, every minute.

💡 Recommended: SoFi’s Crypto Guide for Beginners

Get up to $1,000 in stock when you fund a new Active Invest account.*

Access stock trading, options, auto investing, IRAs, and more. Get started in just a few minutes.

*Customer must fund their Active Invest account with at least $25 within 30 days of opening the account. Probability of customer receiving $1,000 is 0.028%. See full terms and conditions.

15 Companies That Accept Dogecoin as Payment in 2022

1. The Dallas Mavericks

The NBA basketball team, owned by billionaire Mark Cuban, is not afraid of the occasional stunt to get attention. In March 2021, the basketball team said in an official statement that it would be accepting Dogecoin for both tickets and merchandise. Cuban explained the reasoning for the decision:

“The Mavericks have decided to accept Dogecoin as payment for Mavs tickets and merchandise for one very important, earth-shattering reason, because we can! Because we can, we have chosen to do so. We have chosen to do so because sometimes in business you have to do things that are fun, engaging and hopefully generate a lot of PR. So we will take Dogecoin, today, tomorrow and possibly forever more. For those of you who would like to learn more about Dogecoin we strongly encourage you to talk to your teenagers who are on TikTok and ask them about it. They will be able to explain it all to you”

There are some other sports teams that accept cryptocurrencies, too, like the NBA’s Sacramento Kings, the NFL’s Tennessee Titans, the NHL’s San Jose Sharks, and MLB’s Oakland Athletics.

2. AirBaltic

Around the same time the Mavericks said they would begin accepting Dogecoin as payment, the European airline AirBaltic made a similar announcement.

“As an innovative airline, we always strive to search for ways to improve the customer experience starting from the booking process. Over the years around 1,000 clients have used the payment option, which may not seem like a lot, but still offers passengers a unique payment option hard to find elsewhere,” the airline’s CEO Martin Gauss said in a statement.

AirBaltic is majority owned by the Latvian state, adding an official level of approval to a cryptocurrency that, as its founder has said whenever anyone would ask, is meant to be a joke.

3. Newegg

The electronics online retailer said in April 2021 that it would start accepting Dogecoin. “We’re committed to making it easy for our customers to shop however works best for them, and that means letting them complete transactions with the payment method that suits them best. To that end, we’re happy to give Dogecoin fans an easy way to shop online for tech,” a Newegg executive said in a statement.

4. The Kessler Collection

The Kessler Collection owns several luxury hotels throughout the United States. In March 2021, the company said it would “accept Bitcoin, Ethereum, Dogecoin.” The company specifically pointed to cryptocurrencies hitting “an all-time high” as a justification for the expansion of the number of currencies they would accept.

5. Twitch

Twitch is a digital streaming service traditionally used by gamers to broadcast their gaming and associated commentary. Though it’s owned by Amazon, which does not accept Dogecoin or other cryptocurrencies as a valid form of payment, you can use Dogecoin on Twitch. Users can tip streamers in a variety of cryptos, in fact.

6. Tesla

As of early 2022, electric car maker Tesla accepts crypto. Tesla accepts Dogecoin, too, but not all Tesla products are eligible for purchase with crypto, though, so take note before you try and pre-order a Cybertruck with your DOGE holdings.

7. Keys4Coins

Keys4Coins is a digital PC games store, which sells a number of different products and services in the gaming sphere. As the name of the company suggests, it does take coins (crypto coins) as a form of payment, too, including Dogecoin.

8. AMC

You can also buy movie tickets at AMC Theaters with Dogecoin and Shiba Inu, using the company’s mobile app. AMC’s leadership made the announcement in early 2022, and have said that they will accept other cryptocurrencies in the future, too.

9. GameStop

GameStop has embraced its place in the meme space, and has started accepting meme coins, like Dogecoin, as a form of payment. GameStop is getting deeper into the crypto space with NFTs and metaverse projects, too, and is also accepting a short list of other cryptos as well.

10. Bitrefill

Bitrefill is a digital platform that allows customers to buy gift cards or even cell phone air time with crypto. Given the wide range of gift cards available from the retailer, it could be a good way to get a lot of utility from your crypto holdings. Bitrefill accepts Dogecoin, and several other cryptos.

11. Sling TV

You can even pay for your monthly television subscription with Dogecoin, as Sling TV has partnered with a crypto payment processor to accept crypto payments. Along with Dogecoin, you can pay for Sling TV with Bitcoin, Bitcoin Cash, and Ethereum.

12. Menufy

Menufy is an online ordering platform designed for use by restaurants. It allows restaurants to accept cryptocurrency payments through a crypto payment processor. There are thirteen in all, including Dogecoin.

13. ExpressVPN

For those seeking to cover their tracks on the internet, a VPN can go a long way. And now, you can pay for a VPN service using crypto like Dogecoin. ExpressVPN accepts several cryptocurrencies in exchange for using its service.

14. Sheetz

Sheetz, a chain of convenience stores in the eastern United States, is unique among businesses of its type in that it will accept crypto at the gas pump and in the store. That includes Dogecoin, along with Bitcoin and Ethereum.

15. Various Non-Profits

There are many non-profit organizations that allow people to donate money to, or pay them using Dogecoin and cryptocurrency. An internet search will yield many, many results.

	Bitcoin	Dogecoin	Ethereum	Tether	Bitcoin Cash
Newegg	Yes	Yes	Yes	No	Yes
Dallas Mavericks	Yes	Yes	No	No	No
The Kessler Collection	Yes	Yes	Yes	No	No
AirBaltic	Yes	Yes	Yes	No	Yes
Twitch	Yes	Yes	Yes	No	Yes
Tesla	No	Yes	No	No	No
Keys4Coins	Yes	Yes	Yes	No	Yes
AMC	Yes	Yes	Yes	No	Yes
GameStop	Yes	Yes	Yes	No	No
Sheetz	Yes	Yes	Yes	No	Yes
Bitrefill	Yes	Yes	Yes	Yes	No
Sling TV	Yes	Yes	Yes	No	Yes
Menufy	Yes	Yes	Yes	No	Yes
ExpressVPN	Yes	Yes	Yes	No	No

Pros and Cons of Using Dogecoin for Purchases

There are some considerations, or pros and cons, to take into account when using Dogecoin to make purchases.

On the pro side, Dogecoin’s user base is growing, and so is the potential number of businesses that might accept it. And since Dogecoin is modeled after Bitcoin, it’s relatively easy to transact. It’s also easy to exchange for fiat or other cryptocurrencies, as Dogecoin is listed on most major crypto exchanges.

Conversely, though it’s become more popular, Dogecoin is still not accepted by many businesses, relatively speaking. It’s also worth noting that it’s an incredibly volatile asset, and could lose value before you’re able to make a purchase. Finally, there’s no supply cap for Dogecoin, which could affect its value going forward.

Pros & Cons of Making Purchases With Dogecoin
Pros	Cons
Growing in popularity	Still not widely accepted
Easy to transact	Fluctuations in value
Easy to exchange	No supply cap

Buying Crypto Today

While merchants have not begun accepting any types of cryptocurrencies, many do accept Dogecoin. Given its volatility, however, it can be hard to know whether using Dogecoin to make purchases will end up saving or costing the buyer money.

FAQ

Which retailers will accept Dogecoin?

Many retailers accept Dogecoin, such as Sheetz, GameStop, and Newegg. It’s likely that more will in the future, too.

How many companies accept Dogecoin as payment?

It’s hard to pin down just how many companies accept Dogecoin as payment, but the list is likely growing by the day. As cryptocurrency becomes more commonplace, it’s likely that more companies will accept it as payment, and Dogecoin may be among those cryptos.

Does Amazon take Dogecoin?

No, Amazon does not accept Dogecoin as a form of payment. In fact, it doesn’t accept any cryptocurrencies at all.

Photo credit: iStock/Ksenia Raykova

SoFi Invest®
INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE
SoFi Invest encompasses two distinct companies, with various products and services offered to investors as described below: Individual customer accounts may be subject to the terms applicable to one or more of these platforms.
1) Automated Investing and advisory services are provided by SoFi Wealth LLC, an SEC-registered investment adviser (“SoFi Wealth“). Brokerage services are provided to SoFi Wealth LLC by SoFi Securities LLC.
2) Active Investing and brokerage services are provided by SoFi Securities LLC, Member FINRA (www.finra.org)/SIPC(www.sipc.org). Clearing and custody of all securities are provided by APEX Clearing Corporation.
For additional disclosures related to the SoFi Invest platforms described above please visit SoFi.com/legal.
Neither the Investment Advisor Representatives of SoFi Wealth, nor the Registered Representatives of SoFi Securities are compensated for the sale of any product or service sold through any SoFi Invest platform.

Crypto: Bitcoin and other cryptocurrencies aren’t endorsed or guaranteed by any government, are volatile, and involve a high degree of risk. Consumer protection and securities laws don’t regulate cryptocurrencies to the same degree as traditional brokerage and investment products. Research and knowledge are essential prerequisites before engaging with any cryptocurrency. US regulators, including FINRA , the SEC , and the CFPB , have issued public advisories concerning digital asset risk. Cryptocurrency purchases should not be made with funds drawn from financial products including student loans, personal loans, mortgage refinancing, savings, retirement funds or traditional investments. Limitations apply to trading certain crypto assets and may not be available to residents of all states.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

²Terms and conditions apply. Earn a bonus (as described below) when you open a new SoFi Digital Assets LLC account and buy at least $50 worth of any cryptocurrency within 7 days. The offer only applies to new crypto accounts, is limited to one per person, and expires on December 31, 2023. Once conditions are met and the account is opened, you will receive your bonus within 7 days. SoFi reserves the right to change or terminate the offer at any time without notice.

First Trade Amount		Bonus Payout
Low	High	Bonus Payout
$50	$99.99	$10
$100	$499.99	$15
$500	$4,999.99	$50
$5,000+		$100

SOIN0822017

Sep

2022

14 Benefits of Cryptocurrency in 2023

By Brian Nibley | Growing Wealth, invest, Investing | Comments Off

The primary benefit of Bitcoin and most other cryptocurrencies based on blockchain technology is that many of them lack a central authority, payment processor, or company owner. From this stems several other benefits, such as ease of transactions, potential for higher return for traders, and even relatively good network security.

Since crypto networks tend to be peer-to-peer, meaning that people can transact directly with one another. Let’s look at some of the advantages of cryptocurrency in this crypto guide.

Benefits of Owning Crypto in 2023

1. Easy Transactions

Crypto transactions can be made easily, generally at a low cost, and in a relatively private manner. Using a smartphone app, hardware wallet, or exchange wallet, almost anyone can send and receive a variety of cryptocurrencies.

Some types of cryptocurrencies, including Bitcoin, Litecoin, and Ethereum, can be purchased with cash at a Bitcoin ATM. A bank account isn’t always required to use crypto, so it’s possible that someone could buy Bitcoin at an ATM using cash, then send those coins to their digital wallet or phone. This may be a huge advantage for people who might lack access to the traditional financial system.

2. Relatively Secure

Because cryptocurrencies are rooted in cryptography and blockchain security, decentralized cryptocurrencies tend to make for secure forms of payment. As such, the relative security of cryptos may be one of the biggest benefits for users.

Crypto security, in large part, is determined by hash rate. The higher the hash rate, the more computing power is required to compromise the network. Bitcoin is considered to be the most secure cryptocurrency, as it tends to have a higher hash rate than other networks.

Note, though, that using a crypto exchange is only as secure as the exchange itself, however. Most incidents of crypto being hacked involve exchanges being hacked or users making mistakes, like falling for phishing scams.

3. Short Settlement Times and Low Fees

While some people may only want to invest in cryptocurrency to take advantage of (prospective) price appreciation, others might find benefit in the ability to use crypto as a medium of exchange.

Bitcoin and Ether transactions can range from a few cents, to several dollars or more. Other cryptocurrencies, like Litecoin, XRP, and others, might be able to be sent for less. Payments for most cryptos settle within minutes, and some within seconds. Conversely, wire transfers at banks can cost significantly more, and often take three to five business days to settle.

4. Exponential Industry Growth

The cryptocurrency industry has been one of the fastest-growing markets that most of us have seen in our lifetimes, especially since the industry got its start with the debut of Bitcoin back in 2009. The total market cap of the cryptocurrency market in 2013 was about $1.6 billion. By September 2022, it’s worth more than $930 billion. That, too, is including the so-called “crypto winter” that the crypto markets experienced for much of 2022.

So, while the industry as a whole has seen incredible growth over the past decade, it’s important to keep in mind that markets ebb and flow.

5. The Possibility of Outsized Returns

Bitcoin has been one of the best-performing assets of the last 13 years. When it debuted in 2009, Bitcoin essentially had no value, but in the following years, it would rise to a fraction of a penny, and then eventually to tens of thousands of dollars. This represents millions of percentage points’ worth of gains. By comparison, the S&P 500 index of stocks returns an average of about 8% per year.

💡 Recommended: Bitcoin Price History: 2009-2023

Some altcoins have outperformed Bitcoin by wide margins at times, although many of those later saw their prices collapse. Gains like these might be among the most well-known cryptocurrency benefits. The losses, on the other hand, may be among the most well-known drawbacks. And that’s important to note, as crypto prices have fallen quite a bit, as of late. For example, during 2022, Bitcoin’s price has fallen by more than 60% as of September.

That type of volatility has characterized prices in the crypto space, which has been one of the key benefits of cryptocurrency for day traders and speculators, too. Taking advantage of the fluctuations in price can help traders earn returns, even if prices fall.

6. More Private Transactions

Privacy can be a big benefit of cryptocurrency, but crypto isn’t always as private as some people might think. Blockchains create a public ledger that records all transactions forever. While this ledger only shows wallet addresses, if an observer can connect a user’s identity to a specific wallet, then tracking transactions becomes possible.

While it’s worth noting that most crypto transactions are pseudonymous, there are ways to make more anonymous transactions. Coin mixing services group transactions together in a way that makes it hard to pick them apart from one another, which can make it difficult to track for outside observers. Individuals who run a full node also make their transactions more opaque because observers can’t always tell if the transactions running through the node were sent by the person running the node or by someone else.

Methods like these are for more advanced users and could prove difficult for those new to crypto. So while absolute privacy is really not one of the main positives of cryptocurrency, transactions are still generally more private than using fiat currency with third-party payment processors.

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*Customer must fund their Active Invest account with at least $25 within 30 days of opening the account. Probability of customer receiving $1,000 is 0.028%. See full terms and conditions.

7. Portfolio Diversification

Cryptocurrency has become known as a non-correlated asset class. Theoretically, crypto markets largely function independently of other markets, and their price action tends to be determined by factors other than those affecting stocks, bonds, and commodities. Though that theory has been tested this year, as assets of all types of slipped, including cryptocurrencies. It’s worth noting, though, that during the last few years, cryptos have begun to sometimes trade in tandem with stocks for short periods of time.

So, in terms of diversification, cryptocurrencies offer investors another vehicle with which to try and grow their money outside of stocks, ETFs, or bonds. Crypto has its own unique risks, but it is another avenue for potential returns for investors.

8. Potential Inflation Hedge

Mineable cryptocurrencies with a limited supply cap, like Bitcoin, Litecoin, and Monero, to name a few, were traditionally thought to be good hedges against inflation. Because monetary inflation can occur when central banks and governments print more money (increasing the supply), things that are more scarce tend to appreciate in value.

With more and more new dollars chasing fewer and fewer coins, the price of these fixed-supply coins as measured in dollars has a higher chance of going up. Additionally, the Bitcoin protocol, for example, is also designed to keep those coins scarce regardless of what happens with monetary policy.

The potential of cryptos to stand up to inflation has been yet another test this year, as we’ve experienced higher rates of inflation than in several decades. As mentioned, crypto prices have fallen, but it’s hard to say how much of that has to do with inflation. Crypto may still serve as a hedge, but it may not be as ironclad of a concept as it once was.

9. Cross-Border Payments

Cryptocurrencies have no regard for national borders. An individual in one country can send coins to someone in a different country without any added difficulty. With traditional financial services, getting funds across international borders can take a long time and come with hefty fees. In some cases, doing so might not even be possible due to regulations, sanctions, or tensions between specific countries.

But again, cryptocurrency gets around all of that, as users can engage in peer-to-peer transactions from anywhere in the world.

10. A More Inclusive Financial System

Some of the benefits of cryptocurrency extend to people who don’t have access to, or perhaps don’t trust, the traditional financial system. Due to its decentralized and permission-less nature, one of the benefits of cryptocurrency is that anyone can participate outside of that system.

People don’t need permission from any financial authority or government to use the crypto ecosystem. (Though it’s worth noting that Bitcoin mining is banned in China, and that there may be other local rules and regulations to take not of.) Participants also don’t necessarily need to have a bank account. There are billions of people today who are “unbanked,” meaning they have no access to the financial system, including bank accounts. With crypto, however, the only thing those people need is a smartphone, and they can essentially become their own bank.

11. Transactional Freedom

One of the great benefits of crypto is that it can be used to exchange value between two parties. This can be done independently of any third-party, making the transaction about as free as it can get. It’s similar to handing a dollar bill to a friend on the street.

Banks, or other payment processors, can choose to cut off services to anyone for any reason. This can make things difficult for some journalists, political dissidents, or other individuals working in nations with oppressive government regimes. Because there is no central authority governing Bitcoin or most other cryptocurrencies, it’s very difficult to stop anyone from using them.

12. Always-Open Markets

Stock markets, like the New York Stock Exchange (NYSE), are only open on weekdays during the regular business hours of 9:30 am to 4:30 pm Eastern Time. During nights, weekends, and on holidays, most traditional financial markets are not open for business.

Crypto markets, on the other hand, operate 24 hours a day, seven days a week, without exception. Some of the only things that could interrupt a person’s ability to trade cryptocurrency would be a power outage, internet outage, or centralized exchange outage.

13. Adaptability

Some cryptocurrency projects take measures to become more efficient or resource-intensive. That’s a big difference between, say, the traditional banking system, which is often stuck utilizing outdated technologies and protocols.

One example: “The Merge,” which involved Ethereum moving from a Proof-of-Work model to a Proof-of-Stake model, effectively ending mining operations, and instead, adopting a much more efficient operating model. The ability of cryptos to change things up in a big way, and on a widespread, operating level, means that it has another advantage over traditional systems.

14. Specialization

Some cryptos can be designed specifically for certain projects or uses. Some cryptos, for instance, are designed to work with metaverse projects or games, and can be used to help create in-game assets or tokens.

The Takeaway

Transactional freedom, security, and ease of transaction are among the most important advantages of cryptocurrency. Many cryptos are designed to have unique advantages over fiat currencies or the traditional banking system, even if they don’t have widespread use or adoption yet.

Of course, there are potential flaws as well — volatility being a major downside. As with anything, though, those interested in buying, selling, and trading crypto would be wise to do their research before getting involved in the crypto market.

FAQ

Is cryptocurrency a good investment?

Cryptocurrency can be a worthwhile investment, and has numerous benefits for investors. It is, however, a speculative investment, and there are lots of risks unique to the crypto markets. As such, investors should do their homework before getting in the market.

What should you know before trading cryptocurrency?

There are many considerations to take into account before trading crypto, including the fact that there are numerous exchanges, ways to trade, and coins on the market. Prospective traders should also know that fees may be involved, and that crypto is a highly volatile asset class.

How do I weigh up the pros and cons of each cryptocurrency?

Many cryptocurrencies are similar, but most are their own, individual projects. As such, researching how they each work, what their intended use is, and what the potential drawbacks are for each crypto is a good place to start when weighing pros and cons.

Photo credit: iStock/insta_photos

SoFi Invest®
INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE
SoFi Invest encompasses two distinct companies, with various products and services offered to investors as described below: Individual customer accounts may be subject to the terms applicable to one or more of these platforms.
1) Automated Investing and advisory services are provided by SoFi Wealth LLC, an SEC-registered investment adviser (“SoFi Wealth“). Brokerage services are provided to SoFi Wealth LLC by SoFi Securities LLC.
2) Active Investing and brokerage services are provided by SoFi Securities LLC, Member FINRA (www.finra.org)/SIPC(www.sipc.org). Clearing and custody of all securities are provided by APEX Clearing Corporation.
For additional disclosures related to the SoFi Invest platforms described above please visit SoFi.com/legal.
Neither the Investment Advisor Representatives of SoFi Wealth, nor the Registered Representatives of SoFi Securities are compensated for the sale of any product or service sold through any SoFi Invest platform.

Crypto: Bitcoin and other cryptocurrencies aren’t endorsed or guaranteed by any government, are volatile, and involve a high degree of risk. Consumer protection and securities laws don’t regulate cryptocurrencies to the same degree as traditional brokerage and investment products. Research and knowledge are essential prerequisites before engaging with any cryptocurrency. US regulators, including FINRA , the SEC , and the CFPB , have issued public advisories concerning digital asset risk. Cryptocurrency purchases should not be made with funds drawn from financial products including student loans, personal loans, mortgage refinancing, savings, retirement funds or traditional investments. Limitations apply to trading certain crypto assets and may not be available to residents of all states.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

²Terms and conditions apply. Earn a bonus (as described below) when you open a new SoFi Digital Assets LLC account and buy at least $50 worth of any cryptocurrency within 7 days. The offer only applies to new crypto accounts, is limited to one per person, and expires on December 31, 2023. Once conditions are met and the account is opened, you will receive your bonus within 7 days. SoFi reserves the right to change or terminate the offer at any time without notice.

First Trade Amount		Bonus Payout
Low	High	Bonus Payout
$50	$99.99	$10
$100	$499.99	$15
$500	$4,999.99	$50
$5,000+		$100

SOIN0922056

Sep

2022

What Is Polkadot (DOT)?

By Brian Nibley | Growing Wealth, invest, Investing | Comments Off

The Polkadot blockchain protocol is designed to help other blockchains work together in a single network. Polkadot aims to let different blockchains quickly communicate value or information without an intermediary.

For example, the Polkadot blockchain allows Bitcoin and Ethereum to transfer data to one another. It accomplishes this by using parallel blockchains, known as parachains, that take the burden of processing power away from the main blockchain, making the Polkadot blockchain generally more efficient.

Proponents believe this could solve some existing cryptocurrency challenges of interoperability and scalability, by processing many transactions on parachains at the same time. DOT is the native utility coin of the network.

How Does Polkadot Work?

Speed, scalability, interoperability, and security are paramount for many crypto projects — but achieving all of them is challenging. The Polkadot blockchain is an innovative platform that is attempting to address the so-called trilemma of many crypto platforms, thanks to its interconnected system of blockchains.

Polkadot’s Blockchain Ecosystem

The Polkadot network is made up of two kinds of blockchains: the relay chain, where all transactions are finalized, and custom, user-generated chains, called parachains that use the computing power of the relay chain to validate transactions.

On top of these, Polkadot has another layer composed of Bridges that enable data to move between different blockchains — and even connect with non-blockchain databases.

The network’s many parachains, each of which is like a blockchain unto itself, do a lot of the heavy lifting for the main relay chain. As a result, the Polkadot network can process more than 1,000 transactions per second. As the network grows and more parachains are added, Polkadot should get even faster.

What Is Kusama?

Kusama is an operational blockchain within the Polkadot network that enables the testing of new features for Polkadot before they are released. Kusama is sometimes called a “canary network,” or an experimental network used by developers who want to iterate quickly, or are preparing for deployment on Polkadot.
Kusama coin (KSM) is the native cryptocurrency of the Kusama network.

How Do You Stake on Polkadot?

What is Polkadot crypto and how does it work? Unlike some other types of crypto, DOT cryptocurrency has two main functions: holders can stake their DOT with validators who confirm transactions on the network and produce new DOT tokens, or they can use their DOT to nominate delegates who will have a say in the future of the protocol. In the second case, DOT works as a governance token.

DOT is considered an inflationary crypto as there is no maximum supply or cap, as there is with Bitcoin and other crypto.

The Polkadot blockchain uses a consensus mechanism known as Nominated Proof of Stake (NPoS), which is a variation of Delegated Proof of Stake (DPoS).

In NPoS networks, nominators can use their staked DOT tokens to back validators whom they believe will act in the best interest of the blockchain. One of the key differences between NPoS and DPoS, according to the official Polkadot website, is that NPoS punishes nominators who nominate bad validators.

Developers created the NPoS system to deal with one of the biggest problems that DPoS networks have faced in the past: the potential for some delegates to wield disproportionate control over how the network works.

Advantages & Disadvantages of Polkadot

Here are some pros and cons of investing in Polkadot (DOT).

Advantages

Some potential pros of the Polkadot cryptocurrency include:

• DOT holders can stake it to earn more DOT, at a relatively high rate of interest (about 14%, as of September 2022).

• It offers exposure to crypto assets that empower interoperable blockchains.

• Rather than being full validator nodes, users can also be collators or fishermen. These roles require less technical expertise. Collators keep track of valid parachain transactions while fishermen report bad behavior on the network.

• Developers can also use Polkadot and DOT coin to create and launch new kinds of blockchains.

Disadvantages

Some potential drawbacks of DOT include:

• The NPoS consensus mechanism is new, making its future uncertain.

• Altcoins can suffer deep price declines when a new competitor emerges or if investors lose interest.

• To directly participate in network activities like staking or governance requires large amounts of DOT.

• Becoming a validator requires substantial technical knowledge and time commitment, so nodes could wind up becoming controlled by a small number of people.

Who Created Polkadot?

Gavin Wood, chief training officer and core developer of Ethereum, helped create the project alongside co-founders Peter Czaban and Robert Habermeier, and published the whitepaper in 2016.

Wood is known for having invented Solidity, the language developers use to write decentralized applications (dapps) on Ethereum.

Despite having a record-high ICO (initial coin offering) in 2017, the project was hacked and the setbacks prevented Polkadot from launching until 2020.

Why Does Polkadot (DOT) Have Value?

DOT crypto is key to maintaining and operating the Polkadot ecosystem. Users who own and stake DOT can vote on network upgrades. Votes are proportional to how much DOT you have staked.

Price of Polkadot (DOT)

As of September 28, 2022, DOT was worth $6.43 and is the 11th largest crypto, with a market cap of $7.22 billion.

Why Use Polkadot (DOT)

Investing in DOT has a couple of important use cases. The first, obviously, is the potential for steady returns through staking. But a longer-term perspective could be that investing in DOT helps to support the innovations that Polkadot brings to the table, which could improve the cryptosphere for all.

Does Polkadot (DOT) Have Staking?

Yes. But staking rules on different platforms vary, so be sure to understand what’s involved by checking the Polkadot website. Only nominators can stake coins, but the number of nominators is limited.

The Takeaway

The Polkadot crypto project is a next-generation blockchain that attempts to promote a heterogeneous multi-chain framework and tries to resolve many of the limitations that blockchains currently hold, like scalability and security, as well as true, trustless interoperability.

Polkadot is considered innovative, and somewhat successful, in that its ecosystem has fostered greater interoperability. This is important because blockchain networks remain isolated from each other, which is problematic for the future of crypto and for blockchain technology. The interoperability between banks, for example, encourages commerce throughout the world; without the ability to seamlessly transfer assets, economies would stall.

Photo credit: iStock/smrm1977

First Trade Amount		Bonus Payout
Low	High	Bonus Payout
$50	$99.99	$10
$100	$499.99	$15
$500	$4,999.99	$50
$5,000+		$100

SOIN0722034

Sep

2022

What Is a 51% Attack?

By Inyoung Hwang | Growing Wealth, invest, Investing | Comments Off

A 51% attack is when a cryptocurrency miner or group of miners gains control of more than 50% of a network’s blockchain. The 51% attack scenario is rare — especially for more established cryptocurrencies — mainly because of the logistics, hardware, and costs required to carry one out. But a successful block attack may give the attacker complete control of the network and allows them to double-spend coins, prevent other transactions from confirming, and block other miners from mining.

Cryptocurrency investing can be potentially lucrative, but it involves a higher degree of risk, especially compared with stock or bond investing. And 51% attacks could be a threat for people who use, buy, and sell cryptocurrencies. If an investor is considering adding digital currencies to their portfolio, it’s important to understand the implications of a 51% attack.

Background on 51% Attacks

A 51% attack is an attack on a blockchain, which is a type of digital database in ledger form. With blockchain technology, information is collected in groups or blocks and linked together to create a data chain. In cryptocurrency trading, blockchains are used to record approved transfers of digital currencies and the mining of crypto coins or tokens.

With many cryptocurrencies, “miners” can attempt to add blocks to the chain by solving mathematical problems using mining machines — a process known as Proof of Work. These machines are essentially a network of computers. If miners succeed in adding a block to the chain, they receive cryptocurrency in return.

The speed at which all the mining machines within the network operate is the hashrate. A good hashrate can help gauge the health of the network.

A 51% attack occurs when one or more miners take control of more than 50% of a network’s mining power, computing power, or hashrate. If a 51 percent attack is successful, the miners responsible essentially control the network and certain transactions that occur within it. This could mean that the attackers could double-spend coins or manipulate transactions.

Additionally, a 51% attack on a blockchain could damage the reputation of a cryptocurrency, leading to a decline in value as investors sell their crypto.

Examples of a 51% Attack

51% attacks are not just a theoretical concern. There have been a few notable examples of 51% attacks in the past, including:

• A 2018 attack on Bitcoin Gold (BTG) resulted in over $18 million worth of the currency being double spent.

• Multiple attacks on Vertcoin (VTC) in 2018 resulted in doubling spending of more than $100,000 worth of VTC.

• A 2019 attack on Ethereum Classic (ETC) resulted in over $1 million of the currency double spent. Additionally, the crypto faced three attacks in 2020.

• A 2020 attack on Grin (GRIN), though the blockchain was able to regain control.

• Three attacks on Bitcoin SV (BSV) occurred in 2021, damaging its reputation.

Most 51% attacks occur on smaller cryptocurrencies. Experts say it’s unlikely that major cryptocurrencies will face a successful 51% attack because it is prohibitively expensive to take control of more than half of mining power.

How a 51% Attack Works

When a cryptocurrency transaction occurs, newly mined blocks must be validated by a consensus of nodes or computers attached to the network. Once this validation occurs, the block can be added to the chain.

The blockchain contains a record of all transactions that anyone can view at any time. This record keeping system is decentralized, meaning no single person or entity has control over it. Different nodes or computer systems work together to mine, so the hashrate for a particular network is also decentralized.

However, when one or more miners control a majority of the hashrate, the cryptocurrency network is disrupted. This disruption is a 51% attack. Those responsible for a 51% attack would then be able to:

• Exclude new transactions from being recorded

• Modify the ordering of transactions

• Prevent transactions from being validated or confirmed

• Block other miners from mining coins or tokens within the network

• Reverse transactions to double-spend coins

These side effects of a block attack can be problematic for cryptocurrency investors and those who accept digital currencies as payment.

For example, a double-spend scenario would allow someone to pay for something using cryptocurrency, then reverse the transaction after the fact. The malicious actor would effectively be able to keep whatever they purchased along with the cryptocurrency used in the transaction, bilking the seller.

What a 51% Attack Means for Cryptocurrency Investors

A 51% attack isn’t a common occurrence, but it’s not something that can be brushed off. For cryptocurrency investors, the biggest risk associated with a 51% attack may be the devaluation of a particular digital currency.

If a cryptocurrency is subject to frequent block attacks, that could cause investors to lose confidence in the market. Such an event could cause the price of the cryptocurrency to collapse.

The good news is that there are limitations to what a miner who stages a 51% attack can do. For example, someone carrying out a block attack wouldn’t be able to:

• Reverse transactions made by other people

• Alter the number of coins or tokens generated by a block

• Create new coins or tokens from nothing

• Transact with coins or tokens that don’t belong to them

The larger a blockchain grows, the more difficult it becomes for rogue miners to attack it. On the other hand, smaller networks may be more vulnerable to a block attack. Investors may be able to insulate themselves against the possibility of a 51% percent attack by investing in larger, more established cryptocurrency networks versus smaller ones.

Ways to Prevent a 51% Attack

50% Limit on a Single Miner

A blockchain’s protocol could ensure that no miner or a group of miners controls more than 50% of the blockchain’s hashing power.

Using Proof of Stake

A blockchain could use a more robust blockchain consensus algorithm. Some consensus algorithms, like Proof of Stake, are more resistant to 51% attacks than others, like Proof of Work.

Strong Network Community

A blockchain’s strong community could help prevent a 51% attack, especially if the blockchain uses a Proof of Stake (PoS) consensus algorithm. With PoS, the community must vote to determine if a user can be a block validator, which is like a miner in a Proof of Work system. If the community senses that a user is amassing power to attack the blockchain, they can throw the user out of the network, preventing an attack.

The Takeaway

Cryptocurrency investing may appeal to investors if they’re comfortable taking more risks to pursue higher returns. If an investor is new to cryptocurrency trading, the prospect of a 51% attack might seem intimidating. Understanding how they work and the likelihood of one occurring can help them feel more confident.

FAQ

What’s the difference between a 51% attack and a 34% attack?

A 51% attack is a type of attack in which a group of miners takes control of more than 50% of the total computing power of a cryptocurrency network. This allows them to double-spend coins, prevent other transactions from being confirmed, and so on. A 34% attack is a type of attack in which a group of miners takes control of more than 34% of the total computing power of a cryptocurrency network. This may allow the attacker to approve or disapprove transactions, though it does not allow them to take full control of the blockchain.

Can a 51% attack reoccur?

Yes, a 51% attack can reoccur. A 51% attack could reoccur if the original attacker regains control of 51% of the network’s hash power or if another entity gains control of 51% of the network’s hash power. Multiple attacks on a blockchain may occur if steps are not taken to improve a blockchain’s security.

Who is at risk of a 51% attack?

Smaller cryptocurrencies are more at risk of a 51% attack. It is less expensive and energy-intensive to amass 51% control of hashing power for smaller cryptocurrencies than larger and more established cryptos.

SoFi Invest®
INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE
SoFi Invest encompasses two distinct companies, with various products and services offered to investors as described below: Individual customer accounts may be subject to the terms applicable to one or more of these platforms.
1) Automated Investing and advisory services are provided by SoFi Wealth LLC, an SEC-registered investment adviser (“SoFi Wealth“). Brokerage services are provided to SoFi Wealth LLC by SoFi Securities LLC.
2) Active Investing and brokerage services are provided by SoFi Securities LLC, Member FINRA (www.finra.org)/SIPC(www.sipc.org). Clearing and custody of all securities are provided by APEX Clearing Corporation.
For additional disclosures related to the SoFi Invest platforms described above please visit SoFi.com/legal.
Neither the Investment Advisor Representatives of SoFi Wealth, nor the Registered Representatives of SoFi Securities are compensated for the sale of any product or service sold through any SoFi Invest platform.

Crypto: Bitcoin and other cryptocurrencies aren’t endorsed or guaranteed by any government, are volatile, and involve a high degree of risk. Consumer protection and securities laws don’t regulate cryptocurrencies to the same degree as traditional brokerage and investment products. Research and knowledge are essential prerequisites before engaging with any cryptocurrency. US regulators, including FINRA , the SEC , and the CFPB , have issued public advisories concerning digital asset risk. Cryptocurrency purchases should not be made with funds drawn from financial products including student loans, personal loans, mortgage refinancing, savings, retirement funds or traditional investments. Limitations apply to trading certain crypto assets and may not be available to residents of all states.

Investment Risk: Diversification can help reduce some investment risk. It cannot guarantee profit, or fully protect in a down market.

²Terms and conditions apply. Earn a bonus (as described below) when you open a new SoFi Digital Assets LLC account and buy at least $50 worth of any cryptocurrency within 7 days. The offer only applies to new crypto accounts, is limited to one per person, and expires on December 31, 2023. Once conditions are met and the account is opened, you will receive your bonus within 7 days. SoFi reserves the right to change or terminate the offer at any time without notice.

First Trade Amount		Bonus Payout
Low	High	Bonus Payout
$50	$99.99	$10
$100	$499.99	$15
$500	$4,999.99	$50
$5,000+		$100

SOIN0922063