What bitcoin and cryptocurrencies are

In a nutshell

A cryptocurrency is digital money recorded on a network of computers, not in a bank. Bitcoin is the best known. No central bank issues or controls these coins. The price can rise or fall a lot in a short time, and there is no guarantee from the FGC, Brazil's deposit guarantee fund.

How it works

Each cryptocurrency has a public record of every transfer. That record is copied on thousands of computers around the world. That is why nobody can erase a transfer alone. It is also why a transfer sent by mistake can almost never be reversed.

No government sets the price. It depends only on how much people are willing to pay at that moment.

Stablecoins are cryptocurrencies designed to follow the value of a regular currency, such as the US dollar. They swing less, but they depend on whoever issues them and are not covered by the FGC either.

Example

Marcos bought R$ 1,000 of a cryptocurrency. Suppose, just as an example, that its price fell 30% in a few weeks.

• Loss: R$ 1,000 × 30% = R$ 300.
• Value left: R$ 1,000 − R$ 300 = R$ 700.

Now, to get back to R$ 1,000, the coin needs to rise R$ 300 on top of R$ 700. That is R$ 300 ÷ R$ 700, about a 42.86% rise. A 30% drop needs a much bigger rise than 30% just to break even. And nothing guarantees that rise will happen.

Where your crypto is kept

• At an exchange: a company holds the coins for you, and you log in with a username and password. It is simpler, but you depend on that company's security and financial health.
• In your own wallet: you keep the access key yourself, usually a list of words called a recovery phrase. Whoever has that phrase has the money. If you lose the phrase, nobody can recover the coins.

Never show your password or recovery phrase to anyone, not even someone who says they are from support.

In Brazil, companies that provide crypto services, such as exchanges, need authorization from the Central Bank to operate. This comes from Law 14.478/2022, and the Central Bank's rules for these companies have applied since February 2026, with an adjustment period for those already operating. This oversight covers the company, but it does not protect the coin's price and does not create any FGC guarantee.

Most common scams

• Pyramid schemes: the "returns" of earlier members are paid with money from newer members. When new people stop joining, everything collapses.
• "A robot that earns 1% a day": nobody can guarantee a fixed gain on something that swings this much. A promise of a sure daily return is a sign of a scam.
• Fake support agents or fake investors on social media asking for a transfer or your recovery phrase.

Step by step

1. Before buying, pay off expensive debt and build your emergency fund.
2. Choose an amount you could lose completely without hurting your household bills.
3. Ask the company that will hold your coins whether it has authorization from Brazil's Central Bank, or an authorization request under review, and how it protects accounts. Be wary if it won't answer.
4. Turn on two-step verification, and keep passwords and your recovery phrase away from your phone and your messages.
5. In Meu Gasto, open the crypto wallet under Net worth and record how much you have. You enter the price yourself, so update it whenever you want to see today's value.
6. Be suspicious of anyone who promises sure gains or rushes you.

Common mistakes

• Investing rent money or your emergency fund. Use only an amount you can lose without squeezing your month.
• Assuming there is a guarantee like a savings account. Cryptocurrencies are not covered by the FGC. If the price falls or the company fails, the loss is yours.
• Buying because "everyone is making money". When the price has already risen a lot, the risk of a drop is still there. Decide by your plan, not by excitement.
• Giving your recovery phrase to someone. Whoever asks for your phrase wants your coins. Never send it to anyone.
• Panic selling after a drop. Big drops are part of this market. That is why the amount you invest should be small from the start.