You are likely to have seen adverts for cryptocurrencies appearing with growing frequency, or seen the likes of Bitcoin or Ethereum in the news. But who has been investing in these assets, and how do their holdings compare to other assets?
An online survey by YouGov for the BSA asked people about their holdings of different assets. 2,094 adults were surveyed between 2-3 December 2021*. These figures give an insight into people’s holdings of different classes of assets, but are only for those who were willing to share this information and are based on their own estimates of the value of these holdings.
As might be expected, a greater proportion of young people say they have invested in cryptocurrencies relative to older age groups. This is shown in the chart.
A quarter of those aged 18-24 years old said that they held cryptocurrencies, with more than 5% saying that their holdings were worth £100,000 or more.
The proportion with cryptocurrencies declines with age, and those in older age groups mostly estimate that their holdings are worth under £5,000.
Although a quarter of those aged 18-24 hold cryptocurrencies, double this proportion hold cash savings, and holdings of other investments such as shares and bonds, and also property, are also more common, as can be seen in the next chart. These other asset classes are much more commonly held by older age groups.
Why are people investing in cryptocurrencies?
Most people who hold cryptocurrencies say they don’t have a specific purpose for which they are investing. This is particularly the case for older investors, as the next chart shows. However, those under 35 are more likely than older age groups to say that they are investing simply to increase their wealth.
So crypto investments are not generally seen as providing a direct route into the housing market or to making other purchases, though those in the 18-24 age group who hold cryptocurrencies are slightly more likely to say they are investing to help them buy a property (14%) or to fund a large expenditure (12%).
Earlier this week, the Financial Policy Committee at the Bank of England said it was watching the rapid growth of cryptoassets, the vast majority of which is made up of “unbacked” cryptocurrencies which have no underlying assets. The Bank says these are vulnerable to major prices corrections and investors may lose all of their investment.
*All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 2094 adults. Fieldwork was undertaken between 2nd - 3rd December 2021. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+).