Young British adults haven’t been put off from investing in cryptocurrencies despite the prices crash seen this year, finds a survey commissioned by WisdomTree, the exchange-traded fund (“ETF”) and exchange-traded product (“ETP”) sponsor.
A survey of 1,002 adults in the UK aged between 18 and 30, conducted by Opinium, revealed the number of young British adults invested in cryptocurrencies is nearly the same as the number invested in stocks and shares ISAs, 27 per cent and 28 per cent respectively, suggesting a shift in how young adults are investing.
The survey paints a picture of cryptocurrency adoption increasing. Familiarity of cryptocurrencies is high, with nearly nine in 10 (89 per cent) being somewhat familiar, and one in five (21 per cent) claiming to be very familiar. Non-fungible tokens or NFTs, introduced in 2018 but only recently started gaining attention, has also proved to be familiar amongst those surveyed with seven in ten (70 per cent) being at least somewhat familiar.
Jason Guthrie, head of digital assets, WisdomTree, said: “Despite a high level of familiarity of cryptocurrencies, seeking out high-quality information remains a priority amongst young adults, and rightly so. We are still early on the crypto asset adoption curve, and to get further along more education is needed. We know sentiment towards cryptocurrencies amongst young adults is positive.”
Interestingly, the survey reveals that four in 10 (40 per cent) respondents now have a more positive view towards cryptocurrencies than when Bitcoin reached an all-time high value of over $68,000 in November 2021.
Guthrie continued: “Many events have unfolded across crypto and financial markets in 2022. This is encouraging them to seek out more information to educate themselves. Cryptocurrencies are maturing into a traditional asset class and, as with any other asset class, it is essential that you do your research, know what you’re investing in and have a long-term investment horizon.”
Need for trusted information to support demand
Young British adults are becoming more discerning when it comes to reasons for investing in crypto. Survey respondents suggested they no longer care about endorsements from high profile figures, just 11 per cent would be more likely to invest because of a celebrity endorsement. Instead, they want to know more about the fundamentals of cryptocurrency (32 per cent) and have more educational materials available to them (31 per cent).
When it comes to knowledge on cryptocurrencies, 48 per cent of young adults do not know how they work, yet over half (56 per cent) say they are likely to invest in cryptocurrencies in the future. 58 per cent do not think there is enough information available to them from sources that they trust, so it is important that traditional finance firms and those offering access to cryptocurrencies provide high-quality and accessible information to support this demand for education. In fact, 27 per cent of young adults say they would be more likely to invest if cryptocurrencies were more established in financial services. Nearly six in 10 (56 per cent) would be more comfortable if there were wider support for the asset class from government and regulators.
Adria Beso, head of platforms distribution, Europe, WisdomTree, said: “Young adults are increasingly treating crypto like a mature asset class. They don’t care about celebrity endorsements and the promise of unsustainable returns. Instead, they want to understand how they work and see more support from government and regulators. This year has seen a number of major public policy shifts for digital assets in the United States, UK, and EU. The announcements are positive signs that digital assets are being integrated into existing regulatory and legislative frameworks in different parts of the world.
“The digital asset ecosystem is maturing and more could benefit as it becomes more regulated. In addition to this, whilst the recent volatility may have provided an attractive entry point to invest in cryptocurrencies, it is essential that investors focus on increasing their knowledge and understanding before investing. Firms offering access to cryptocurrencies have a duty to produce high-quality, easy to understand and accessible information to help people make informed decisions.”
Image and article originally from thefintechtimes.com. Read the original article here.