Similar to forex — foreign exchange — trading, there can be significant risks involved with a largely unregulated market, and your best bet is to get informed beforehand, and don’t invest any money you can’t afford to lose. Regulators are still trying to figure out how to classify cryptocurrencies, for purposes of trading, payments, antifraud, taxation, and more. Clear regulation may help us understand how to use cryptocurrency and what its future may look like, but we aren’t there yet.
When you buy cryptocurrencies via an exchange, you purchase the coins themselves. You’ll need to create an exchange account, put up the full value of the asset to open a position, and store the cryptocurrency tokens in your own wallet until you’re ready to sell.

Many lesser-used cryptocurrencies can only be exchanged through private, peer-to-peer transfers, meaning they’re not very liquid and are hard to value relative to other currencies — both crypto- and fiat.
Crypto exchanges on a growth path shared a few common traits: they're larger, more innovative and offer more digital assets than their competitors.