What are the main risks involved in crypto trading?

Crypto trading involves several key risks. Price volatility means values can swing dramatically in hours, causing sudden losses. Leverage trading amplifies both gains and losses—borrowing money to trade can result in losing more than your initial investment. Liquidation occurs when leveraged positions drop in value, forcing automatic position closure. Exchange risks include platform hacks, shutdowns, or insolvency where you lose funds. Market manipulation and low liquidity in smaller cryptocurrencies can create slippage—getting worse prices than expected. Emotional trading from fear or greed leads to poor decisions. Regulatory changes can crash markets overnight. Additionally, technical errors, phishing scams, and inexperience with complex trading tools pose serious threats. Start with small amounts, use stop-losses, avoid excessive leverage, and only trade funds you can afford to lose.