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Crypto

Cryptocurrencies are digital assets that use cryptographic technology for secure transactions on decentralized blockchain networks. They operate independently of traditional banking systems.

🔑 Key Characteristics

Property Detail
Code in LibreFolio CRYPTO
Pricing 24/7 trading on crypto exchanges (Binance, Coinbase, Kraken, etc.)
Currency Typically quoted in USD, but tradeable against many fiat and crypto pairs
Dividends None for most (some DeFi tokens offer staking rewards)
Volatility Significantly higher than traditional assets
Typical providers Yahoo Finance (e.g., BTC-USD), Manual

📊 Key Concepts

🔐 Decentralization

Unlike stocks or bonds, cryptocurrencies have no central issuer. The value is determined purely by supply and demand across global exchanges.

📈 Market Capitalization

\[ \text{Market Cap} = \text{Current Price} \times \text{Circulating Supply} \]

Market cap is the primary metric for comparing crypto assets. Bitcoin typically represents 40-60% of total crypto market capitalization.

🔄 Trading Pairs

Crypto assets trade in pairs (e.g., BTC/USD, ETH/BTC). LibreFolio tracks each crypto as a single asset with a reference currency, using FX rates for conversion.

⚡ Staking

Some proof-of-stake (PoS) cryptocurrencies allow holders to "stake" their tokens to earn rewards — functionally similar to interest on bonds.

⚠️ Considerations

  • High volatility: Daily swings of 5-10% are common
  • Regulatory risk: Rules vary widely by jurisdiction and are evolving rapidly
  • Tax treatment: Many countries treat crypto differently from traditional assets — see Taxation
  • 24/7 markets: Unlike stocks, crypto never stops trading