Is Cryptocurrency a Good Investment? Should I Invest in It?

Investing in virtual currency has produced jaw-dropping returns for some, but total loss for others.

By Keith Noonan – Updated May 19, 2026 at 6:47 PM EST | Fact-checked by Frank Bass

Key Points

Investing in crypto ETFs offers exposure to digital currencies with potential lower risk.
Cryptocurrency lacks firm regulations, heightening investment risks and uncertainty.
Diversified portfolios can include crypto to harness its high-reward potential safely.

It is possible to make a lot of money by investing in cryptocurrency -- but it is also very possible to lose all of your invested money. Investing in crypto assets is risky, but it can be a good investment if you do it properly and as part of a diversified portfolio. Let's explore if cryptocurrency is a good investment.

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An infographic outlining risks of cryptocurrency, including cyberattacks, regulations, competition, and volatilities. — Image source: The Motley Fool.

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Is cryptocurrency a good investment?

Cryptocurrency can be a good investment if you want to gain direct exposure to the demand for digital currency. A safer but potentially less lucrative alternative is to buy the stocks of companies with exposure to cryptocurrency. Between these extremes, some cryptocurrencies are now available as spot-price exchange-traded funds (ETFs).

Is cryptocurrency safe?

Multiple factors show that cryptocurrency is not always a safe investment. Still, other signs are emerging that say cryptocurrency is here to stay. The key thing (as with all other investments) is to thoroughly research the cryptocurrency you plan to purchase.

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Cryptocurrency

Cryptocurrency is decentralized and secure digital money, based on blockchain technology, that offers new investment opportunities.

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Risks of investing in cryptocurrency

Cryptocurrency exchanges, more so than stock exchanges, are vulnerable to hacking and other criminal activity. Security breaches have led to sizable losses for investors whose digital currencies were stolen, prompting many exchanges and third-party insurers to offer protection against hacks.

As of May 2026, there were still no clear-cut regulations governing the broader cryptocurrency industry, and the Securities and Exchange Commission (SEC) and other agencies are using existing federal and state laws to regulate it, with mixed results. All of this is to say, there are few protections for investors looking to get into the cryptocurrency market.

Storing cryptocurrencies safely is also more difficult than owning stocks or bonds. Cryptocurrency exchanges such as Coinbase (COIN -4.43%) make it fairly easy to buy and sell crypto assets, such as Bitcoin (BTC +0.07%) and Ethereum (ETH +0.63%). But many people don't like keeping their digital assets on exchanges because it risks allowing any company to control access to their assets.

Some cryptocurrency owners prefer offline cold storage options, such as hardware wallets, but cold storage comes with its own challenges. If you lose your private key, you'll be unable to access your cryptocurrency.

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There's also no guarantee that a crypto project you invest in will succeed. Competition is fierce among thousands of blockchain projects, and many projects are scams. Only a small percentage of cryptocurrency projects will ultimately flourish.

Regulators may also crack down on the entire crypto industry, especially if governments view cryptocurrencies as a threat rather than an innovative technology. For instance, the SEC has filed enforcement lawsuits against many players in the cryptocurrency sector with mixed results.

On the upside, these suits should help Congress and courts hammer out long-term rules and regulations for owning and trading digital assets in the long run. The cutting-edge technology underpinning cryptocurrencies also increases the risks for investors.

Cryptocurrency adoption

Crypto futures markets are being established, and many companies are gaining direct exposure to the cryptocurrency sector. Professional and individual investors are gradually receiving the tools they need to manage and safeguard their crypto assets.

Strategy (MSTR -3.01%) -- a business intelligence software company -- has been accumulating Bitcoin since 2020. It held 818,334 Bitcoin tokens as of May 3, 2026. Chairman Michael Saylor was dubbed by Forbes in 2025, "The Bitcoin Alchemist."

Although other factors continue to affect the riskiness of cryptocurrencies, the accelerating pace of adoption is a sign of a maturing industry.

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Is crypto a good long-term investment?

Many cryptocurrencies, such as Bitcoin and Ethereum, are launched with lofty objectives that may be achieved over long time horizons. While the success of any cryptocurrency project is not assured, early investors in a crypto project that reaches its goals can be richly rewarded over the long term. However, achieving widespread adoption is necessary for any cryptocurrency project to be considered a long-term success.

Bitcoin as a long-term investment

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CRYPTO: BTC

Bitcoin

Today's Change

(0.07%) $51.39

Current Price

$75866.00

Key Data Points

Market Cap

$1.5T

Day's Range

$74344.00 - $75979.00

52wk Range

$60255.56 - $126079.89

Volume

34.8B

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As the most widely known cryptocurrency, Bitcoin benefits from the network effect -- more people want to own Bitcoin because Bitcoin is owned by the most people. Bitcoin is currently viewed by many investors as "digital gold."

Bitcoin investors believe the cryptocurrency will gain value over the long term because its supply is fixed, unlike that of fiat currencies such as the U.S. dollar or the Japanese yen. The supply of Bitcoin is capped at fewer than 21 million coins; most currencies can be printed at the will of central bankers.

Many investors expect Bitcoin to gain value as fiat currencies depreciate. After the fourth halving event in April 2024, Bitcoin's inflation rate is slower than the annual supply-side increase of physical gold on the global market. People who are bullish about Bitcoin being extensively used as digital cash believe it has the potential to become the first truly global currency.

Ethereum as a long-term investment

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CRYPTO: ETH

Ethereum

Today's Change

(0.63%) $12.94

Current Price

$2074.53

Key Data Points

Market Cap

$250B

Day's Range

$2020.99 - $2077.10

52wk Range

$1756.73 - $4946.05

Volume

14.3B

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Ether is the native coin of the Ethereum platform and can be purchased by investors seeking portfolio exposure to Ethereum. While Bitcoin can be viewed as digital gold, Ethereum is building a global computing platform that supports many other cryptocurrencies and a massive ecosystem of decentralized applications (dApps).

The large number of cryptocurrencies built on the Ethereum platform and the open-source nature of dApps create opportunities for Ethereum to also benefit from the network effect and to create sustainable, long-term value. The Ethereum platform enables the use of smart contracts, which execute automatically based on terms written directly into the contract code.

The Ethereum network collects Ether from users in exchange for executing smart contracts. Smart contract technology has significant potential to disrupt massive industries, such as real estate and banking, and to create entirely new markets.

As the Ethereum platform becomes increasingly widely used worldwide, the Ether token gains utility and value. Investors bullish on Ethereum's long-term potential can profit directly by owning Ether. That's not to say Ethereum doesn't have competition.

Several "Ethereum Killers," including Solana (SOL -0.33%), Polygon (POL -0.07%), and Avalanche (AVAX +0.89%), are built to handle smart contracts and use a blockchain system capable of processing more transactions per second. The speed has the added advantage of being less expensive for users. But Ethereum is the most widely adopted platform for smart contract use.

Should you invest in cryptocurrency?

If you believe cryptocurrency usage will become increasingly widespread over time, it probably makes sense for you to buy some crypto directly as part of a diversified portfolio.

For every cryptocurrency you invest in, be sure to have an investment thesis as to why that currency will stand the test of time. If you do your research and learn as much as possible about how to invest in cryptocurrency, you should be able to manage the investment risk as part of your overall portfolio. If buying cryptocurrency seems too risky, you can consider other ways to potentially profit from the rise of cryptocurrencies.

You can buy the stocks of companies such as Coinbase, Block, or PayPal or invest in an exchange like CME Group (CME +0.68%), which facilitates crypto futures trading. Finally, spot Bitcoin ETFs and Ethereum ETFs are options, with more cryptocurrencies likely to enter the ETF space over time.

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Expert Q&A

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About the Author

Keith Noonan is a contributing writer at The Motley Fool covering technology, consumer goods, and other sectors. He holds a bachelor’s degree in English from Boston College.

TMFNoons

Anders Bylund has positions in Bitcoin, Ethereum, and Solana. The Motley Fool has positions in and recommends Avalanche, Bitcoin, Ethereum, PayPal, Solana, and Tesla. The Motley Fool recommends CME Group and Coinbase Global and recommends the following options: long January 2027 $42.50 calls on PayPal and short September 2025 $77.50 calls on PayPal. The Motley Fool has a disclosure policy.

Is Cryptocurrency a Good Investment?

Investing in virtual currency has produced jaw-dropping returns for some, but total loss for others.

Key Points

Is cryptocurrency a good investment?