Crypto investing
Crypto investing in Europe: bitcoin and ethereum are popular with both beginners and experienced investors. There are also many other cryptocurrencies, while staking and lending can provide additional returns. Learn how to buy, store and invest in crypto.
- Investing in crypto
- Crypto exchanges
- A personal wallet
- Risks and returns
- Investing in bitcoin
- Ethereum or other coins
Please note: investing in crypto involves high risks. You may lose part or all of your investment.
What is crypto?
There are many different cryptocurrencies, and their purposes differ. Some are used for payments, while others help validate transactions. The ones investors buy are more comparable to assets, such as stocks. Bitcoin and ethereum are the best-known examples. You buy those when you expect their value to increase over time.
Investing in crypto
If you already invest in stocks or ETFs, you can easily add crypto to your portfolio. For example as a hedge against inflation or geopolitical uncertainty, similar to digital gold. For this purpose, a small investment in bitcoin and ethereum can help a lot already.
For example through a crypto ETN, which works similarly to investing in ETFs and is available through most European investment platforms. Several popular brokers also offer direct access to crypto, including DEGIRO, Trade Republic and Scalable Capital.
Open an account directly with a large European broker such as eToro, known for its beginner-friendly platform, or DEGIRO, which is popular for its low trading fees. Investing involves risks. You can lose your investment.
Crypto exchanges
If you want more than a simple buy-and-hold strategy in the most popular cryptocurrencies, there are also dedicated crypto brokers and exchanges. These often offer lower trading fees, a wider selection of coins and access to services such as staking, lending and earn programs.
The introduction of the European MiCA regulation has created a framework for crypto companies, increasing oversight and transparency across the sector. Some of the most popular crypto platforms in Europe include:
Bitvavo started in 2018 and is the leading crypto exchange platform in the Netherlands and active in 27 European countries. You can invest in more than 400 cryptocurrencies. The platform is easy to use with both an easy dashboard for beginners, and a very complete exchange for experienced users.
- 2+ million European users
- low trading fees
- local European payment methods
- easy-to-use staking program
- recurring crypto purchases (DCA)
- MiCAR licensed in Amsterdam, The Netherlands
Has users all over the world and is an authority in the crypto industry. It offers an extensive range of crypto, a user-friendly interface and advanced trading features. Has a strong emphasis on security, including insurance of digital assets.
- 300+ billion dollars in assets under custody
- high liquidity across major cryptocurrencies
- trusted by retail and institutional investors
- institutional custody provider
- publicly listed on US Nasdaq
- Regulated in the United States and across Europe
Professional exchange with over 480 coins/tokens, many trading options and secure storage. Based in the US, but Kraken operates internationally, and has 15+ million users worldwide. The ease of use however, can be challenging for inexperienced users.
- Over 42 billion dollar in client assets
- 665 billion dollar trading volume in 2024
- Large selection of coins and tokens
- Professional exchange
- Includes futures and margin trading
- MiFID II and MiCAR licenses
Storing crypto in a personal wallet
A broker, exchange or ETN can store your cryptocurrencies for you. It is also possible to store them independently of other parties by keeping them in your own wallet.
This can be done through a software wallet on your phone or computer, or by using a separate hardware wallet. With a hardware wallet you can store your crypto offline. This is known as cold storage and can bring an extra level of safety.
Investment risks and returns
Cryptocurrencies are among the most volatile investment assets. Prices can rise sharply, but can also fall by 50 percent or more. For this reason, many investors only allocate a small part of their portfolio to crypto. The high volatility also creates the potential for substantial returns.
The value of cryptocurrencies depends entirely on supply and demand. There is no revenue, profit or dividend that can be used to estimate what a cryptocurrency should be worth, as analysts often do with stocks. Large investors and institutions can also have a major influence on prices, especially in smaller cryptocurrencies. As a result, price movements can be difficult to explain and even harder to predict.
Investing in bitcoin
Bitcoin was the first cryptocurrency and remains the largest by market value. Because of its size, long track record and limited supply of 21 million coins, many investors see bitcoin as digital gold.
For many investors, bitcoin is the starting point when building a crypto portfolio. It is also widely available through crypto exchanges, brokers and crypto ETNs. Because bitcoin often sets the direction of the broader crypto market, its price movements are closely watched by investors.
Ethereum or other coins
Ethereum is the second-largest cryptocurrency. Together, bitcoin and ethereum form the foundation of many crypto portfolios. Beyond those two, there are thousands of other cryptocurrencies. Some, such as solana and XRP, have become established projects. Others are much smaller and still have to prove themselves.
Stablecoins
With stablecoins, the value is linked to assets such as the euro or US dollar, making them less sensitive to market movements. Stablecoins do not offer price gains, but some platforms offer returns on stablecoins through lending and earn programs.
Many investors also use stablecoins to move money between crypto to avoid converting back to euros or dollars.
