A new survey paints a bleak picture of British crypto investors’ motivation, knowledge and openness about their investments.

Almost two out of five (36%) retail crypto investors in the country admitted that their understanding of the sector was “poor or absent” when they made their first investment. Over time, 21% of cryptocurrency investors still rate their knowledge of the sector as low.

The survey was conducted by Oxford Risk, a corporate software company specializing in asset management and financial services products.

Although the survey is small – only 1,038 respondents – it has been weighted to reflect the UK’s demographic profile.

In addition to the low level of investment expertise in cryptocurrency, the study found that the demand for digital assets was driven by FOMO or fear of missing out on it. Around 35% of respondents said that they read a lot about the sky-high prices of cryptocurrencies, and 15% said that they were encouraged to invest in the sector by friends or family. Greg B. Davis, Head of Behavioral Finance at Oxford Risk, said:

“The concern is that many people buy blindly without knowing what they are doing, and they are affected by investments in the form of high prices and others who encourage them to try. This is uneasy if people invest large amounts of cryptocurrency and do not understand what they bought. ”
A significant minority are also uncertain about the market of the future: 45% said they do not know if there will be a steady rise in prices, 32% are not sure that there will be, and 24% firmly believe that there will be one. However, 21% of respondents plan to either buy cryptocurrency for the first time this year or increase their existing assets.

In particular, the majority of investors invested relatively small amounts of money in this sector: 81% said they bought more cryptocurrencies in the spirit of “see what happens”, 76% invested less than 5% or less of their total savings, and 41% said they had less than 1%. … However, 7% of investors own up to 20% of their total assets in cryptocurrency, and 10% own more than 10%.

According to a recent study by the UK Financial Conduct Authority, 2.3 million adults in the country owned cryptocurrencies from June 2021, up from 1.9 million last year. In addition to increasing the number of investors, the Financial Conduct Authority (FCA) found that average holdings rose to £ 300 ($ 420) from £ 260 ($ 370) in 2020.

This growth has been accompanied by increased awareness: 78% of the UK adult population said they had heard of cryptocurrency – again, up from 73% the year before. Like Oxford Risk, the Financial Conduct Authority (FCA) has noticed a marked decline in the understanding of cryptocurrency, which also indicates that many consumers do not understand the technology and the industry.

Source: CoinTelegraph