Grayscale Survey Sheds Light on the Market of Potential Bitcoin Investors
Despite the widespread belief that only a niche group of people are attracted to bitcoin, a new survey released by Grayscale found data pointing to the contrary.
Grayscale’s “Bitcoin 2019 Investor Survey” revealed that, in a pool of 1,100 U.S. investors, more than a third (36 percent) of U.S. investors would consider an investment in bitcoin. Assuming there are 63 million investors in the U.S., bitcoin-curious investors represent a potential market of over 21 million investors.
Who Is Interested in Bitcoin?
According to the data from the survey, the profile of bitcoin-interested investors is mainly those that are middle-aged, middle-class and from the suburbs. Of these bitcoin-interested investors, 70 percent are parents with children, 49 percent make less than $100,000, and 42 percent view bitcoin as both a long- and short-term investment.
Compared to the average U.S. investor, these investors tend to be slightly more risk-tolerant. Beyond that, profiles between the two groups are largely similar, including demographics based on
- Age: slightly younger (42) than the average U.S. investor (45).
- Political affiliation: slightly more Republican than Democratic
- Income: similar income distribution, with earnings on the higher end ($100,000+)
- Gender; both women (51 percent) and men (49 percent) are overall investors, and of those, 43 percent of women and 57 percent of men are interested in bitcoin
What Is the Appeal of Bitcoin?
Based on the information collected in the survey, there are three main reasons as to why investors are interested in bitcoin:
- Investors can start small: 83 percent of survey takers indicated that the benefit of investing in bitcoin was the ability to invest a small amount, observe the performance and choose to build upon their investments in the future.
- Bitcoin has significant growth potential: 73 percent of bitcoin-curious investors are intrigued by bitcoin’s rapid development.
- Scarcity creates value: 73 percent of bitcoin-interested investors compare the value of bitcoin to gold because of the limited number of bitcoins available, a quality which increases the value of bitcoin as competition grows.
Reasons for NOT Investing in Bitcoin
The survey also highlighted some common reasons as to why there is hesitation among the 64 percent of investors who are not interested in bitcoin. The four main reasons include
- Hacking and Fraud: Due to the widely publicized hacks of exchanges and thefts that occur in the world of bitcoin, 75 percent of all investors and 68 percent of bitcoin-interested investors are concerned with the risk of digital crime. This is the number one investment fear related to bitcoin.
- Lack of Regulation: While some crypto fanatics are against the idea of government regulations, an unregulated market is the second largest cause for concern that 65 percent of investors overall and 53 percent of bitcoin-interested investors have when it comes to digital currencies.
- Lack of Education: 89 percent of people surveyed said they would feel much more confident about investing in bitcoin if they had a better understanding of it. Better educational resources would make them more likely to invest in the currency, according to they survey.
- Need for Guidance: The lack of trusted third parties that have an understanding of bitcoin is also a reason as to why many investors hesitate to invest. Based on the survey results, investors said working with an advisor (78 percent) or with a familiar firm (77 percent) would make them more likely to invest in bitcoin.
Grayscale’s survey highlighted that one area of improvement when it comes to encouraging investors to invest in bitcoin is education. With the proper advisors and educational materials, investors will turn to bitcoin as the future of investing continues to become digital.