Common Questions Around Crypto Investing & Trading

Is crypto an inflation hedge?

Whether crypto is an inflation hedge depends on how you define “hedge” and over what duration. The strongest case for Bitcoin as a hedge is its fixed supply: there will only ever be 21 million BTC. Of course fiat currency is not fixed and often quite the opposite. Hence, the theory is Bitcoin’s non-dilutive characteristics make it an inflation hedge.

Has this worked out this way? Well, kinda, yeah. Often times the arguments around this question mostly line up with preconceived positions on Bitcoin and crypto in general. If you’re against crypto and against Bitcoin, well, you’re often cherry picking timeframes that support your case. And vice-versa. This question is often impossible to prove over short duration. You might even say the first 15 years of crypto’s existence isn’t even enough time to prove out the answer to this question.

Looking backward, Bitcoin is worth a lot more than it used to be, and we’ve had quite a bit of inflation in the meantime. Does this answer the question? Yes and no. Time will bear out the truth here.

Is crypto digital gold?

This question overlaps with the previous one to a degree but also involves the topic of “store of value.” Since most people are not transacting with Bitcoin and various crypto coins for every day items multiple times a day, many crypto enthusiasts have defaulted to a store of value thesis. Similar to how we do not transact in gold bullion for every day items, Bitcoin has similar characteristics.

What are stablecoins?

Stablecoins (such as USDC and USDT) are cryptocurrencies designed to keep a steady value, usually by being tied to a real‑world asset like the U.S. dollar. The goal is to combine the speed and flexibility of crypto with the price stability of traditional money. For example, a dollar‑pegged stablecoin aims to trade at about $1.00, so users can move value on blockchain networks without the volatility of Bitcoin or other tokens.

There are a few main types of stablecoins. The most common are fiat‑backed stablecoins, which claim to be supported by cash or cash‑like assets held in reserve. Crypto‑backed stablecoins use other cryptocurrencies as collateral, often with extra buffers to manage volatility. Algorithmic stablecoins attempt to maintain a peg through software‑driven supply adjustments rather than direct collateral, though these can be more fragile.

People use stablecoins for trading, transferring funds across borders, storing value between trades, and accessing decentralized finance tools. Because they’re designed to be stable, they also act as a bridge between crypto and traditional money.

Stablecoins are not risk‑free. Their stability depends on how they’re backed, how transparent the reserves are, and how markets respond in stressful conditions. Understanding the type of stablecoin matters before using it.

What is staking?

Crypto staking is a way to help secure certain blockchain networks and, in return, earn rewards. It applies to blockchains that use a proof‑of‑stake (PoS) or similar consensus system. Instead of miners using computing power, validators are selected to confirm transactions based on how much crypto they “stake” (lock up) in the network. When you stake, you’re essentially committing your tokens to support the network’s operations, and you may receive rewards in the same token.

For everyday users, staking often happens through an exchange or wallet app (many of the crypto apps we recommend offer staking features). You choose a token, lock it for a period of time (or leave it flexible), and earn yield while it’s staked. The reward rate depends on the network and can change over time.

Staking comes with tradeoffs. The biggest is liquidity: staked funds might be locked or require a waiting period to withdraw. There’s also market risk — if the token’s price drops, rewards may not offset the loss. Some networks also have “slashing,” where validators can lose a portion of their stake if they behave improperly, though many apps manage this risk for users.

In short, staking can be a way to earn passive rewards on certain crypto assets, but it isn’t risk‑free and should be understood before committing funds.