Cryptocurrency enthusiasts worldwide don’t shy from sharing their support for the burgeoning asset class, voicing the inevitable disruption of traditional finance market as the use of cryptocurrencies increase.
However, an independent research finding in the U.K. suggests the contrary, concluding only 38% of adults in the United Kingdom “understand cryptocurrencies.”
Inflated Community Sentiment
As reported by Express on July 27, 2018, London-based investment house IW Capital surveyed over 2,007 British citizens to determine their awareness, preparedness, and openness towards investing in the cryptographic asset class.
As recorded, only 38% test-takers understood the underlying technology of cryptocurrencies – blockchain – and 5% of respondents reported any incurred capital gains. Also, only 5% of investors took guidance from an advisor before purchasing cryptocurrencies.
A vast majority consider cryptocurrencies as inferior to other investment avenues. Only 7% of respondents chose cryptocurrency over traditional investment vehicles, such as stocks or bonds, for investment purposes.
Considering U.K.’s average age of 40.2 years, as per data collated by Statista, the digital asset market has a long way to go before usurping traditional sectors.
The report stated:
“The data reveals that, fundamentally, Brits do not have enough information or knowledge on the topic of cryptocurrency. In fact, many have no knowledge about the subject whatsoever.”
IW Capital believes an inherent lack of education prevents the casual investor from understanding blockchain technology and cryptocurrencies, creating a barrier for any potential investments.
Institutions Pursuing Financial Gains Only
Luke Davis, the CEO of IW Capital, expressed his “shock” over the public’s confusion surrounding cryptocurrencies. However, Davis stated the report did not reflect the risk-appetite of investors, rather indicating the absences of proper financial guidance and “a lack of facts” from mainstream media and local governments.
Although not intended for the purpose, the volatility of cryptocurrencies has created a vibrant trading market for cryptocurrencies, with exchange, insurance, and custodial businesses becoming billion dollar sectors in their own right.
Mike Ingram of WH Ireland echoes the sentiment:
“Serious traders merely saw BTC as a wildly volatile instrument that threw up opportunities in an otherwise dull market.”
Ingram added institutions and private investors are interested in cryptocurrencies only for their financial gain, instead of an “an endorsement of their value.”
Recent news about proposed Bitcoin ETFs, positive regulatory proceedings, and technological developments have culminated into a bullish sentiment for the cryptocurrency market, with the pioneer cryptocurrency gaining over 19% in July 2018 over the past month.
Cover Photo by Jonathan Chng on Unsplash