Crypto addiction is a growing problem, but how big?

Several clinics offer services to help crypto addiction. But how bad is this new problem?

For years, society has been more and more concerned about gambling addiction, and rightly so. Gambling addiction is responsible for untold damage to families and communities. However, experts and psychologists have identified a new and growing problem: crypto addiction.

Several clinics have begun offering programs to help patients with this new disease. Castle Craig, a Scottish rehabilitation clinic established in 1988 by Peter and Dr Margaret Ann McCann, which has since expanded internationally, is one such centre. In 2016, they became one of the world’s first treatment centers to offer a crypto trading addiction treatment program.

“More volatile and exciting than gambling”

Anthony Marini, a senior specialist therapist at Castle Craig, believes going under the radar is a problem. “If you think there’s about 3% of the UK population addicted to gambling, then by my estimate there’s about 5% with a problem with crypto.”

“It’s more volatile and exciting than gambling,” he says. “We see more and more people with a problem year by year.”

Anthony saw his first crypto addiction case way back in 2016. Since then, Castle Craig has seen over 250 patients with the problem. Including a marked increase after the collapse of FTX last year.

In many ways, crypto addiction shares many similarities with gambling addiction. (Inconceivably, one is a subset of the other.) Both involve high-risk investments that can lead to significant financial losses. Both also provide a rush of adrenaline as victims obsess over the elusive big payday.

Crypto addiction: Just the symptom of another problem?

Like gambling, crypto addiction can also lead to compulsive behavior, with individuals becoming fixated on market trends and making increasingly risky trades. Angie Malltexi, CSO at Clipper DEX, agrees that this behavior can be detrimental to an individual’s financial, mental and physical health. I asked where she would draw the line. When does it become a problem?

“I believe that crypto trading can become unhealthy, especially if a person becomes obsessed with it to the point that it negatively affects their daily life, financial stability and relationships,” she says. The line at which it becomes unhealthy will vary from person to person, but generally when it starts to negatively affect other aspects of a person’s life.”

However, Malltexi makes an interesting – if not controversial – point. Crypto addiction, like other addictions, is the symptom of an external stressor. A move that not everyone will agree with.

“Scientific research has shown that emotional stress is a consistent trigger for addictive behavior; as such, it would be more beneficial to society and a better use of financial resources to invest in social infrastructure that helps people recover from the underlying factors that have caused their addiction – this could be childhood trauma, lack of a community or emotional support system, among other factors that contribute to significant stressors in our lives.”

Is crypto addiction the same everywhere? Almost certainly not.

Addiction can also mean different things depending on where you live and what is happening around you. For example, some things that people can become addicted to may not be seen as a problem elsewhere. Also, when a doctor looks for addiction, they may look for different signs than a judge would look for.

In China, the last decade or so has seen a moral panic over internet addiction. At least 33 million are hooked on online games and other entertainment, according to the China Internet Network Information Center. In 2019, minors were limited to 90 minutes of play on weekdays and banned from playing between 10pm and 8am. In 2021, the restrictions were tightened to only one hour of gaming per day on Fridays, weekends and public holidays.

Depending on the survey, the time spent on the internet before 2019 was not very different than in the West. Nevertheless, politicians and civil society look out

It begs the question, is addiction the same everywhere? Individual scholars have argued that China’s definitions and understanding of addiction are in many respects socially constructed. (Well, of course, right?) So, is one person’s risky bet on Bitcoin another’s clear sign of addiction?

Honestly, crypto hasn’t been around long enough yet for us to really fully understand the issue. Another limiting factor is the context in which it takes place. When many of us trade crypto, it is in the privacy of our own homes or our smartphones. In such cases, privacy makes our behavior more difficult to monitor.

How much of a problem is that?

While individuals may suffer greatly from an addiction to crypto trading, not everyone is convinced that it is a major problem. “Crypto trading is not uniquely addictive and does not strike me as a more significant societal problem than gambling or other potentially addictive activities,” said Scott M. Lawin, CEO and COO of Candy Digital.

“As in these areas, basic risk-taking principles apply: never risk more than you can afford to lose, do your research before getting involved, and learn to recognize signs of addiction in yourself and others.”

Does he think that the industry should highlight the dangers of trading more? “While there are no commitments, like any new financial market or asset class, leaders in the crypto/NFT industry would be well served to highlight the potential risks of their products in order to continue to educate and onboard the next wave of users and build awareness and trust with customers, investors and regulators.”