14 Differences Between Crypto Market and Stock Market

What are the differences between crypto market and stock market? Right from the times when the barter system prevailed to this day when you find several commodities being traded, trade has its own history and as long one as history itself.

However, the stock market, as you know them, is comparatively a new phenomenon – just 400 years old!

Today, you will find a stock exchange in almost every country in this world providing a vast marketplace for people to buy and sell different currencies and commodities with ease all across the globe.

Crypto market, on the other hand, was created to smooth the progress of buying and selling of crypto coins.

This is even a newer appendage to the global marketplace – just a decade old. This market has one thing in common with the stock market – to facilitate trade.

However, the differences between the crypto market and stock market are quite notable and are characterized as more volatile in comparison to the stock market.

There is also a lot of difference in the ways in which the assets are traded in these two markets.

Apart from the above, there are a lot of other factors that differentiate the crypto market from the stock market.

If, in case, you do not know about these differences, this article will explain all those major differences between them in the best possible way.

You will know how each works and the benefits that each of these exchanges provides.

This knowledge will eventually help you to choose the best market to invest your hard-earned money in and expect to get a high return on your investment.

14 Differences Between Crypto Market and Stock Market

Differences Between Crypto Market and Stock Market

Though there are several people trading cryptocurrencies, most of them believe that the crypto market is just the same as the stock markets.

This leads to a lot of confusion among people and they often end up making the wrong decision.

It is, therefore, extremely necessary for you to know the points of difference between the stock markets and cryptocurrency market to clear any doubts that you may have regarding these two markets and choose the right one for you. Here they are.

1. Assets Traded

The primary difference between the crypto market and the stock market is in the type of assets traded in them. Typically, in a stock market or exchange you will be allowed to trade in company shares and stocks.

On the other hand, in a crypto exchange or market you will be allowed to trade with digital currencies such as Bitcoin, Ethereum, and a large variety of other types of cryptocurrencies.

2. Asset Ownership

The shares that you buy in a stock market typically correspond to the equity in a company and the amount depends on the number or amount of shares that you own.

This means that by buying the share you become a partial owner of the company that is issuing the shares to the public. The value of the shares is normally determined by how well the company is doing.

On the other hand, when you buy crypto coins available in the market via a crypto exchange, whether it is a coin or a token, it does not necessarily and automatically translate to symbolizing your partial ownership of the company issuing the particular crypto coin.

The value of these crypto coins is subjective because these are all digital currencies and it is much easier to own them than owning a stock.

3. Asset Issuance

The assets traded in a stock market, mainly stocks and shares, are issued by a publicly traded company. They can do this at their own will whenever they need to raise funds for their company, but subject to the local laws as well as the regulations of the company.

On the other hand, anyone can create a crypto coin and, more often than not, there is a specific cap on the number of crypto coins that one can be issued for the public.

It is for this reason that the value of a feasible and capped crypto coin increases as the demand for it grows, following the basic demand-supply principle of economics, when all other factors remain the same.

4. Maturity

In terms of maturity, the stock markets surely leave the crypto markets a long way behind. This is because the stock market has been functioning far longer than the crypto markets.

With greater maturity of the stock market come higher volumes of trade and diversity as well. It is the maturity of the stock markets that have given a few traders an ample opportunity to dominate the trading circles.

This, however, is considered to be a serious disadvantage to smaller investors. This is because the bigger investors seem to take away all the benefits provided by the stock markets including lower commissions and fees on trade.

On the other hand, the crypto markets are still considered to be in their earlier stage of development.

Due to their shorter history and less maturity, the trading volume and diversity of crypto coins are also quite less as compared to that of the stock market.

5. Regulations

In terms of regulations, the local laws govern the activities of the stock market which also receives support from the government. This makes them more reliable, safer, and more transparent.

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This is because it is required by the stock market to make all their activities public which include all the minutes of general meetings and quarterly financial information.

The shareholders are knowledgeable about the companies as well as the market on the whole while investing.

In contrast, the crypto markets are not regulated by the governments or any other central authorities.

However, of late, there have been a lot of actions taken by the governments of different countries to regulate the crypto market and exchanges.

This is done to boost the confidence of the investors in crypto. However, there are still a lot of activities of the crypto market that are outside the political and regulatory spheres. A few countries like China have even banned the use of cryptocurrencies.

6. Volatility

In the stock market, volatility is quite low which means that this market is more stable in comparison to the crypto markets.

This makes investing in these markets a lot safer though it translates to longer wait times to get the desired financial rewards.

Also, this leads to large trading volumes by the ‘big fish’ traders which make it less prone to financial instability.

However, its connections with and backing from the governments and corporations all over the globe impacts the stock markets due to the geopolitical events.

On the other hand, the crypto market has larger volatility and therefore the highs and lows in these markets are more pronounced.

This makes it more vulnerable to price movements as well as the actions of the ‘whale’ traders who own a large amount of crypto coins.

They invest heavily in this market and thereby influence the trade decisions. However, the crypto markets are insulated from political and economic events because, to a large extent, these markets are free from the controls of other global institutions and governments.

7. Time Factors

If you want to trade in stock markets you will need to wait for a while till you get everything ready. There are lots of rules and regulations to comply with that are developed and modified from time to time.

This can be both energy sensitive and time consuming. Add to that, you will also need to give some time to find a reliable broker and when you find one after research you will need to wait to receive an approval to buy and sell the stocks in the market.

In addition to that, access to this market is controlled and you will also have to trade within its limited business hours.

On the other hand, you can trade any time and any day in the crypto market since it is open 24/7 and even on holidays and weekends.

Moreover, access to these markets is not restricted and anyone can trade in crypto coins irrespective of their social standings.

It is also quite simple and easy to get started wherein all you have to do is signup and register after verification, create an account and fund it to start trading crypto coins.

8. Fees

The fee charged by the stock market and the crypto market is another significant point of difference between them.

Though the rules and regulations that govern the stock markets help in keeping the playing field even and fair, the cost related to trading in these markets can be pretty high.

There are fees and commissions charged by the brokers as well as the charges that you need to pay the banks to make payments. Add to that, you will also be taxed due to the capital gains made.

On the other hand, trading in the crypto market is comparatively lower than trading in the stock markets.

The costs are fewer and miniscule. You only need to pay for mining fees only as the cost related with transacting on the blockchain network.

9. Working Process

Another significant difference between the stock market and crypto markets is in the process in which the assets are released and bought by the participants.

The stock, shares, or bonds released by a company in the stock market are sold by the company itself in the first place. It is after that the secondary market comes into the picture.

It is from here that the small and big investors start buying and selling the stocks. Therefore, ideally, the stock market works in two ways. First, it is the primary market and then it is the secondary market.

On the other hand, the crypto market works in an entirely different way. After the companies create the crypto coins, these are presented in the market.

There is normally no delineation between the primary and the secondary markets. In a crypto market every small and large investor is the same and they can buy or sell crypto assets in the market whenever they want.

10. Risk Factors

The risk factors associated with the stock market and crypto market are also different and in varying nature. Normally, the risks involved in the crypto market are pretty high.

These risks are aggravated even further due to the lucrative trading method of the crypto market which makes the crypto assets as well as the market on the whole more volatile, which, however, has the potential to provide you with much higher returns.

On the contrary, the risks involved in the stock markets are pretty low since it works in an entirely different mechanism.

The prices of the commodities traded in this market are very stable and the diversity of the markets allows you to invest in different commodities and get high returns over time.

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Typically, in a stock market it is much easier to track and predict your investments as compared to crypto investments.

11. Effects of External Factors

Typically, a stock market is affected by political events, sporting events, natural disasters and several other external factors.

The crypto market, on the other hand, entirely depends on the demand and supply factors since it is free from any government regulations and is not controlled by the central banks of the country in which it operates.

12. Value

The crypto market is not only unique in its nature but also in value. There is no intrinsic value of the crypto assets which makes them and the market most volatile.

Therefore, people cannot evaluate it precisely. Since it has only perceived value and no tangible value, the price of the crypto assets fluctuate heavily and rapidly.

However, few specific crypto coins, such as Ethereum, come with a semi-tangible value and therefore it can be used to run apps or smart contracts on the blockchain, as a fuel for computations, and more.

On the other hand, the stock market is entirely different from crypto markets because the products here come with an enormously tangible value, which, in turn, gives you the ownership of a company.

Even if the value of the company you partially own fluctuates, you know that it still has some value in terms of its income, assets and more.

13. Investor Behavior

The investor behavior in the stock market is also more stable than those participating in the crypto market.

This is because the investors in the stock market typically hold their stocks at the times of volatility because they believe that things will be normal very soon once again.

On the other hand, in the crypto market panic-selling is a common event to happen. It is therefore not always wise to hold on to the crypto assets.

This means that investing in the stock market is a much more feasible move than investing in the crypto market, especially if you are planning for your retirement.

14. Some Other Differences

Here are a few other notable differences between the stock markets and crypto markets that are also good to know for any investors and traders.

The external regulations imposed on the stock markets and the need for an intermediary also makes trading on it much slower and costlier than the crypto market.

However, a stock market is not as unpredictable and prone to sudden crashes of currency as you will experience in the crypto markets.

You will find all types of players in the stock market which includes school teachers, plumbers, and even teenagers.

Most of them have a full stock portfolio and earn a handsome return over time.

Crypto investment, on the other hand, is more of a niche investment and here you will find more males than females within the age group of mid 20s and early 30s. Therefore, crypto is yet to become mainstream.

Stocks are also less prone to frauds and scams not only because these are regulated but also go through regular audits so that they continue to exist and are traded in the market.

Crypto markets, on the other hand, being decentralized in nature, are prone to frauds and scams, crypto exchange scandals and hacks.

When you buy stocks you can prove your ownership easily because it is issued in your name. This helps in keeping the records and tracking and it also minimizes the chances of fraud and stealing the stocks.

On the other hand, crypto being digital currency literally, can be hacked and stolen easily and since there is no name tied to them, it is impossible to track when such an incident happens.

The crypto market is also ten times faster than the stock markets and this fact affects everything in it. You can trade faster, and the prices go up and fall faster and in much larger magnitudes in comparison to the stocks.

Market manipulation is another thing that you will not find in the stock markets as you will find in the crypto markets.

This can be a bad thing for an investor when caught in between but it can be beneficial to some extent when it comes to wider adoption because more people are involved in it.

Finally, in the crypto market, it is easy for the new competitors to enter since the entry barriers are pretty low in it.

This results in faster death of the old crypto coins. On the other hand, in the stock market, old businesses do not die as fast as the old coins.

Therefore, in a stock market hundreds of old and new businesses can coexist but in a crypto market it may not be the case.

Which is Better – Crypto Market and Stock Market?

Now that you know the differences between the crypto market and the stock market, you surely know the reasons why most people think that cryptocurrencies are superior.

However, this does not mean that the stock markets are no good today.

In fact, they are. Both are good, and there is no doubt about it.

However, it depends on the perspective of the users to mark one as better than the other.

Ideally, it all depends on your convenience, preferences and needs as to decide which one among them you should choose.

If you want to trade in a stock market, you will get different trading platforms for that matter.

There is a stock exchange in every country which is regulated by the government imposing limits on the market.

But, when you consider the crypto markets, there are no such limitations and thousands of companies are operating in it.

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They release different trading platforms which can be accessed by anyone residing in any part of the world and avail their services.

This wider reach and ease in accessibility make the crypto market much superior in comparison to the stock markets.

The crypto market has also created new horizons and a bright future even though most people do not know for sure what exactly lies in store.

This is because the original objective of crypto has not happened yet which was to be accepted as a form of payment one day just like cash or the credit card is today.

Even then, economists believe that the crypto market is expanding and gaining interest with a lot of people taking part in it.

Also, an equally large number of people are regretting now that they did not invest in cryptocurrency earlier when the price was low.

The reasons for which the crypto market is doing so well today and have taken the world by storm are:

  • Its wider reach
  • Its resistance to global and political events
  • Its low fees and regulation and
  • Its ability to provide higher profits due to the volatility.

All these provide the necessary incentive to people to invest in crypto markets and grow their interest.

The crypto market has affected the stock market in spite of being independent of it.

There are several good reasons for it and some experts believe that the most significant reason is the strong relationship between the price of crypto coins such as Bitcoin and the stock market.

A few major impacts of the crypto market on the stock market include the rise in the price of shares of Tesla by 2% when it announced its investment plans in Bitcoin.

They and other majors like Bloomberg believe that this correlation between the stock index and Bitcoin is good and if it remains positive then the movements of the price of crypto coins will be consistent with the products traded in the stock or equity market.

Well, there are a few other crypto enthusiasts who believe that this may hurt the market significantly because one of the most significant reasons that people love crypto is its self-sufficiency.

The experts also believe that the factors that affect these markets and control profit are also different in spite of the fact that both crypto market and stock market primarily works on the demand and supply principle of economics.

However, the crypto markets are completely decentralized unlike the stock markets that are essentially centralized.

When you invest in a stock market you actually invest in a company but in a crypto market you are actually investing in the blockchain technology or the currency that follows it.

Moreover, if you invest in crypto markets, do not believe in the fallacy that since it follows blockchain it is typically and fully decentralized.

Also, you will only be able to see that you have the coins but never in physical possession of the coins.

This means that you will not know the total evaluation of the crypto market.

In fact, no one really knows about the total market cap of cryptocurrencies.

Therefore, going through all the aspects and differences between crypto market and stock market, things could be summarized as the stock markets are less volatile and much safer than the crypto markets.

Also, the products traded in the stock markets are more cash generative and productive, though at a slower pace than the crypto assets.

This is because when you hold on to your stock of a successful company for about a decade you will end up earning dividends plus the stocks along with a somewhat guaranteed increase in the price of the stock.

This is driven by the stock buybacks or by the reinvestments of cash.

In comparison, if you hold your crypto asset for 10 years, all you will have in the end is the same number of coins, provided that the coin still exists till the end of that tenure.

This is because the price changes are not guaranteed. That is to say, the price changes are not linked with the cash produced.

It is actually driven by the demand and supply of the particular crypto coin which can be an outcome of the actual and real world value or speculation.

Therefore, if you are wondering whether you should invest your money in a stock market or crypto market, first forecast the success of the business in case of stock investments and demand for the currency in case of crypto coins.

Also, consider the outcomes, expected values, probabilities and compare your needs and values with the existing market prices as well.

Eventually, invest in one that seems to be a better deal.


Choosing to invest in either the stock market or crypto market is not easy. You will need to know the differences between them in detail for that in the first place. Thanks to articles like this one, it will not be too difficult for that matter.