Bitstamp has just published an informative study on the level of investor confidence in cryptocurrencies. Over 5,500 institutional decision makers and 23,000 retail investors from 23 countries were surveyed to understand the trajectory of cryptocurrencies in the near future.
To have self-confidence you need to learn
The report shows that the level of knowledge of cryptocurrencies has a direct influence on the level of trust. This observation concerns both individual and institutional investors. As soon as these players know more about cryptocurrencies, they tend to rely more on this new investment class. This conclusion is all the more important since there is one direct link between trust and adoption.
In new, unbanked, high-inflation economies like India or Nigeria, crypto is emerging as an opportunity to access services similar to the banking solution. It can be seen that the level of knowledge in these less developed regions is paradoxically much higherwhich promote trust and therefore their adoption.
Overall, there is high confidence in emerging markets and lower confidence in developed economies.
More confidence in crypto than in derivatives
Cryptos seem to enjoy a fairly high level of trust: just behind real estate and stocks. Crypto scares retail investors less than more sophisticated products like options or futures. Despite the demonization of crypto, countries like United States or Canada have a high degree of self-confidence.
France is lagging behind
Bitstamp reports low confidence among French investors. This observation concerns both individuals and institutions. This is the country where investors have the least confidence among the 23 surveyed. Interestingly, it is also one of the countries where the institutions have the least knowledge of the ecosystem.
Crypto and regulation
On a global scale, less than half of people respondents consider cryptocurrencies to be “regulated”. However, this number is rising more than half in emerging economies. Finally, the majority of people who do not invest believe that crypto escapes regulation.
The epic image of the “deregulated jungle” therefore seems to persist. But even though there was no internationally coordinated cryptocurrency regulation by the end of 2021, more than 103 countries had developed rules for financial institutions.
For institutions, risk and volatility are the biggest concerns, closely followed by lack of regulation in the sector and the fact that crypto is just too new. This last concern is particularly present among French institutions.
Conversely, retail investors mainly come up against lack of knowledge, so of the risk at the level of exchanges. They do not know what exchange to use or which crypto to acquire. That retail investors are therefore seeking advice as crypto can impress neophytes. The demand is very high, but the support is lacking.
The study shows that retail investors seek guidance from a very traditional source: financial advisers.
Education must therefore be central to increasing the use of cryptocurrencies. A more educated investor base is the way forward for digital assets to truly become part of mainstream finance.
Which use cases?
Institutions are increasingly recommending crypto to their customers as retail investors begin to use these technologies in much greater depth. For example, participating in rewarded loyalty programs with cryptocurrencies, the strike or even games are growing uses.
Close 56% of the retail investors surveyed said they are making a ” Act »At least once a week and more than 73% plan to increase their investment in the next 5 years. Institutional investors mostly have the same outlook.
In addition, many individuals would be willing to use cryptocurrencies for consumer spending or donations. No wonder knowing that 80% of individuals and 72% of institutions expect crypto to become mainstream. The majority of institutional and retail investors also believe this will happen in 3 to 5 years, while less than 10% think it will never happen.
The main conclusion of the Crypto Pulse report is that cryptocurrency is likely to become mainstream. But knowledge is the biggest obstacle to its adoption by the general public. Investors, both retail and institutional, have reported surprisingly high confidence in cryptocurrencies, even amid skeptical media coverage. They find it viable and many are enthusiastic about use cases. Yet far too many do not know where to start and who to trust.
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Bitcoin changes everything! I come from a financial background and am passionate about everything about this technology. Every day I try to enrich my knowledge of this revolution, which will allow humanity to move forward in its conquest of freedom.