Share of Americans invested in cryptocurrency grows 125% despite crypto winter

The cryptocurrency market is in turmoil, with assets such as Bitcoin (BTC) registering significant declines in recent months, a factor likely to influence the investment trend among Americans. However, the number of investors choosing to get involved in the sector is growing despite the prolonged uncertain future as digital assets operate in an environment characterized by a difficult economy and the threat of harsh regulations.

In particular, data obtained by Finbold indicates that as of the summer season of 2022, 18% of Americans had invested in various cryptocurrencies. The figure represents a 125% growth from the 8% share of Americans who held a stake in the crypto space in the summer of 2020.

By the summer of 2022, 15% of Americans still had plans to invest in cryptocurrencies, underscoring faith in the sector despite the market downturn. The value represents a growth of around 36.36% from the 11% of Americans who had expressed their intention to venture into cryptocurrency during the summer of 2020.

Data on Americans’ investment in crypto is taken from Statista Global Consumer Survey which sampled views from over 1,000 American adults between the ages of 18 and 64.

Investors ignore crypto winters

Interestingly, Americans’ growing interest in crypto amid extended bear markets partly goes against historical trends where a drop in price has not attracted more.

At the same time, the sector has been hit by fraud incidents in recent months, with the infamous Terra (LUNA) ecosystem crash at the center, with the collapse occurring as more investors turned to stablecoins to alleviate crypto volatility.

In particular, the growth indicates that the relevant investors can withstand the volatility. Such investors likely understand that crypto is still an emerging asset class and technology whose impact on the overall financial sector is not yet fully known. Along these lines, some investors choose to ignore short-term price volatility and focus on potential future growth.

Drivers for continued investment in crypto

More drivers are likely to inform this trend, making quick bucks that stand out. Over the years, crypto has been considered to provide significant profits in a short period of time compared to traditional assets such as stocks. In this case, investors who missed out on last year’s bull run led by assets like Bitcoin and Ethereum (ETH) are potentially buying into the downturn with expectations that the sector will rebound.

In particular, this is one of the riskier motivations for investing in digital assets. In most cases, this strategy’s success depends on an investor’s ability to time their buys and sells perfectly.

Important to mention is that young investors are potentially among the proponents of investing in crypto, as a majority have a genuinely positive view of the sector. Therefore, those assets have expected prices. On the flip side, older investors are known to be more cautious about the industry and the associated risks.

The growth among investors has also correlated with the ability to easily purchase cryptocurrencies with the emergence of new apps that cater to the needs of traders.

At the same time, leading institutions embraced cryptocurrencies, sparking a wave of retail investors. Interestingly, some institutions are likely betting on the sector’s growth, as highlighted by America’s oldest bank BNY Mellon, which has received regulatory approval to become the first mainstream lender to offer crypto services.

Meanwhile, other institutional giants are likely to take a back seat and monitor how the market trends will play out.

Possible barriers to crypto investment

Because of America’s advanced crypto sector, it’s worth noting that there are potential barriers. For many years, most people stayed away from crypto due to factors such as complexity. Some investors still think that the sector is too complicated to understand.

In the long run, crypto proponents argue that the rate of investment is likely to grow because previous years have laid the groundwork for building the right infrastructure.

In addition, cryptocurrencies are likely to become more integrated in sectors such as payment systems. However, regulatory uncertainty remains a crucial concern for most Americans. In particular, the White House and Congress are leading various initiatives to bring clarity to the sector.