Cryptocurrencies are easy to use but could be a snap to lose.

Cryptocurrencies are a way to buy things online — or in person, using a mobile app — with sellers who agree to accept them. Cryptocurrencies can be a fast and inexpensive way to pay for goods and services. But they aren’t backed by a government or central bank and the US government is quick to point out that cryptocurrencies have value because those who use them agree they have value. Truth is, it’s the same with dollars, which are not backed by gold. Dollars buy things in America because people will take them in exchange for goods. Pesos buy things in Mexico because people there agree they’re valuable. Try using pesos at your American supermarket, however, and your ice cream will melt while the cashier calls over the manager and maybe the police. They have no value here.

Still, without a central bank and an international market, the value of cryptocurrencies is volatile. Their worth rises and falls — sometimes sharply — depending on demand. While no financial market offers guarantees – not stock markets, not real estate values, not commodity prices – cryptocurrencies are really pretty unregulated, kinda new, and therefore riskier. What’s more, there are no laws on your side. Even credit cards offer some legal protection in that you’re not responsible for unauthorized charges over $50. There are no such protections for purchases made with cryptocurrencies or their most popular form, bitcoins. Once you hit send, you can’t get your money back, though if your bitcons go through a payment processor – as opposed to the seller directly – you may get some protections.

Bitcoin users store their bitcoin addresses in a “wallet” — either on a computer or other data storage device, or through an online wallet service. If you use Bitcoin, encrypt your wallets and back them up. If your Bitcoin wallet files are accidentally deleted, tampered with by a virus, or stolen, your funds could be gone. Or if the company behind your digital wallet fails, or is hacked, you could lose your funds. Don’t think it can’t happen, it has already.

Bitcoin users have private and public virtual keys. It’s important to secure your private keys, and not share them with anyone. They’re the only way you can use or transfer your bitcoins.  Bitcoin and other virtual currencies post transactions on a public ledger, which typically includes the amount and the wallet addresses of the sender and the recipient. Read the seller’s privacy policy to find out what other information might be collected and shared. If the seller uses a payment processor, check its privacy policy, too. A recent FTC report found that many shopping apps had privacy policies that included broad rights to collect, use, and share data.