Crypto traders say investments fared worse than expected

Americans do not have much faith in cryptocurrency. About 75% of people familiar with crypto say they are not confident that the current ways of investing in, trading or using cryptocurrency are reliable and safe, according to the Pew Research Center’s April survey of 10,071 people aged 18 and older who live in the country. US

Around 18% say they are somewhat confident, but only 6% feel extremely or very confident, the survey found.

Self-esteem also varies by age. About 66% of US adults under 50 who are familiar with crypto are unsure about its reliability and security, the survey found. For those over 50, the figure rises to 85%.

In addition, US crypto traders feel their investments have not performed as well as they had hoped, according to Pew’s survey.

About 45% of respondents say their investments have actually performed worse than they expected. While 30% say their investments have performed as expected, only 15% say their investments have performed better than expected.

One reason for the lack of optimism may be that it is currently a somewhat complicated time for the crypto industry.

The total cryptocurrency market lost around $1.4 trillion in value in 2022 as various crypto firms filed for bankruptcy and FTX, one of the largest crypto exchanges, collapsed.

In addition, crypto investors lost nearly $4 billion to hackers in 2022, according to Chainalysis, a blockchain analytics firm.

But despite past turmoil, crypto’s most popular digital coin appears to be on the rise so far this year.

Since the start of the year, bitcoin has risen by around 80%. As of April 13, the price continues to hover around $30,000. This stretch is the first time it has reached that level since June 2022, but it is still significantly lower than the more than $68,000 peak bitcoin reached in November 2021.

But when it comes to crypto, consumer confidence is especially important.

Since virtual currencies typically do not derive their value from an underlying asset, they are only worth what investors are willing to pay for them.

“Because it has no fundamental support, crypto is a sentiment-driven trade,” James Royal, principal reporter at Bankrate, told CNBC Make It. “It’s absolutely critical for crypto promoters to continue to draw more people into it however they can.”

This is also why crypto is considered a highly volatile asset – its price can fluctuate erratically or decrease in value. Because of this, financial advisors tend to advise against investing more than you are willing to lose.

“Crypto is not an investment,” says Royal. “But rather a trade to cash in on the next guy coming in the door.”

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