The crypto-sphere has been very popular among investors over the last few years, as they are increasingly looking for ways to diversify their portfolios with alternative investments, providing potentially huge returns. Among all the available ways to invest or trade blockchain and crypto-related financial vehicles, crypto penny stocks are one of the most popular ways to take advantage of the high volatility in this market.

What are cryptocurrencies?

Cryptocurrencies are 100% virtual currencies, based on blockchain technology. These currencies rely on concepts like decentralization and peer-to-peer exchanges. While some cryptocurrencies want to offer an alternative to the current fiat centralized monetary system, others target different issues. Launched with Bitcoin in 2009, the cryptocurrency market is now massive, with more than 10,000 different coins available.

Why should you care about the cryptocurrency market as a trader?

Some people consider the cryptocurrency market to be a new economic and monetary system that could one day replace the current financial system. That’s why so many people invest in the cryptocurrency market, especially in Bitcoin. While most people have predominately only heard of Bitcoin, the cryptocurrency market is much more than that. There are thousands of tokens that are working on solving issues in our world and are worth investing in. Even from a pure performance perspective, Bitcoin might not be your best bet - coins with smaller market capitalization have recorded far better returns this year.

The cryptocurrency market is also one of the fastest-growing markets, attracting more and more users among retailers and professionals. The relatively new and unregulated market is also a very volatile one, offering impressive potential returns through non-traditional assets. This volatility is used by active traders looking to make profits from the rapid and sudden rise and fall of token prices.

Why should you use crypto penny stocks in your trading?

An increasingly high number of companies are investing in the blockchain and crypto-related market to offer solutions to better invest, buy, trade, mine, stake, or store cryptocurrencies. The companies offering such services are providing investors and traders great opportunities to benefit from increased use of blockchain and cryptocurrencies, all without having to buy and sell tokens.

Usually, these companies are startups and small companies, known as crypto penny stocks – these are generally worth less than $5. If you’re interested in discovering some of the most promising crypto penny stocks, have a look at this list of top crypto penny stocks to watch now. Crypto penny stocks are great tools in your trading, as they help you indirectly trade the crypto-market!

You don’t have to buy and store your tokens to benefit from the crypto market anymore. All you have to do is find a company involved in this sector to benefit from its popularity. You should be aware that crypto penny stocks are volatile, and thus risky by nature. However, their prices won’t usually move unless there is a real catalyst, or unless the major tokens are moving up or down. Also, remember to always follow your trading plan, so be patient and wait for momentum. Do not enter the markets unless your setups are complete!