Cryptocurrency
A cryptocurrency is a digital asset built on a blockchain, such as bitcoin or ether, traded 24 hours a day, 7 days a week.
Cryptocurrencies trade on specialised exchanges or, as CFDs, at brokers. Unlike forex, the market never closes, not even at weekends.
Their volatility is far higher than that of currencies: daily moves of 5% to 10% happen regularly on bitcoin. That is why ESMA limits retail leverage on crypto CFDs to 2:1, and why the FCA bans crypto CFDs for retail clients altogether.
In the EU, the MiCA regulation now applies to crypto service providers; in the UK, firms must register with the FCA. Scams are common: always check a platform's status before depositing money.