There are many legitimate reasons to use cryptocurrency in place of everyday currencies like British Pounds – it’s secure, cheap and fast and offers genuine technical innovations that many believe will one day replace more traditional forms of exchange.
But because of the anonymity of the transactions, they are also frequently used by criminals seeking to avoid detection for unlawful activities.
However, people have been increasingly buying cryptocurrencies for the purposes of investment, hoping to make a lot of money quickly.
The instability of cryptocurrencies does means that it’s possible to make huge gains with small amounts of investments. But it’s also possible to make huge losses in a relatively short space of time.