A rising interest in cryptocurrency ownership has been noted among Americans, even as the overall rate of cryptocurrency ownership shows a decline. This insight comes from a recent report released by the Federal Reserve Bank of Philadelphia’s Consumer Finance Institute (CFI).
Increased Interest Among Non-Crypto Owners
The April 2024 Labor, Income, Finances, and Expectations (LIFE) Survey highlights that 13.4% of individuals who have never owned cryptocurrency, commonly referred to as “no-coiners,” now express a likelihood of purchasing digital assets in the future. This marks a notable rise from just 6.9% in January 2022, indicating a shift toward a potentially larger market.
Moreover, the survey reveals that a total of 21.8% of all participants indicated their intention to buy cryptocurrency in the future, which represents a solid increase from 10.6% reported in October 2022.
Trends in Cryptocurrency Ownership
While the interest from non-owners is growing, actual cryptocurrency ownership has been consistently declining over the past two years, despite Bitcoin achieving record highs in 2024. The survey reflects the aftermath of the “crypto winter” of 2022, a phase characterized by drastic falls in crypto valuations.
Survey Insights from Previous Years
Ownership rates have shown significant changes over the past few years:
- January 2022: Ownership stood at 24.6%.
- October 2022: A sharp decline to 19.1% was observed.
- October 2023: Ownership further decreased to 17.1%.
- January 2024: Ownership plummeted to 15.5%, despite a 60% surge in Bitcoin prices during the first quarter.
- April 2024: There was a slight recovery to 16.1%, but by July 2024, it hit an all-time low of 14.7%.
This trend suggests a divergence between the market’s upward movement and the declining rate of cryptocurrency ownership. The report states, “There’s a clear disconnect between the rising market and declining ownership. While more non-owners are expressing interest in crypto, this hasn’t translated into increased ownership.”
Understanding the Disconnect
The report suggests that the escalating market interest among no-coiners may be hindered by regulatory uncertainties and concerns related to market fluctuations. Additionally, methodological changes in survey data collection may play a role in how trends are perceived. Earlier surveys included household ownership metrics, while recent studies focus solely on individual ownership.
Influence of Survey Methodology
Despite these methodological shifts, CFI affirms that comparisons across surveys remain valid, revealing a consistent narrative of declining ownership reflective of changing consumer sentiment.
Future Implications for Cryptocurrency Market
The report underscores that while ownership rates may not surge in the immediate future, the increasing interest from non-owners could pave the way for market resurgence. However, this potential is likely contingent on forthcoming regulatory decisions as government bodies strive to establish clearer guidelines for cryptocurrency investments and transactions.
As noted by the report’s author, Tom Akana, “The next few years will be critical in determining whether this growing interest from no-coiners will translate into actual participation in the crypto market.”
