What are the main risks of the crypto market?

Cryptocurrency markets carry several significant risks. Price volatility is extreme—Bitcoin can swing 10-20% in hours, causing substantial losses. Security risks include exchange hacks and wallet theft; billions have been lost this way. Regulatory uncertainty means government actions can crash prices overnight. Liquidity risk occurs with smaller coins that may be impossible to sell quickly. Leverage trading amplifies losses, with liquidation wiping out entire positions. Market manipulation is common in less regulated spaces. Additionally, scams and fraudulent projects are prevalent. New investors often lack experience, leading to emotional decision-making. Finally, technology risks exist—smart contract bugs or network failures can cause asset loss. Start with small amounts you can afford to lose.