21% of UK cryptocurrency investors say they know almost nothing about it

A new survey paints a bleak picture of the motivation, knowledge and risk exposure of UK cryptocurrency investors.

Nearly two-fifths (36%) of retail cryptocurrency investors in the country admitted that they had “poor or non-existent” knowledge of the industry when they made their first investment. Over time, 21% of investors holding cryptocurrencies still believe that their knowledge of the industry is equally low.

The survey was conducted by Oxford Risk, a business software company that focuses on providing products to wealth management institutions and financial services companies.

Although small—only 1,038 respondents—the survey’s research sample is reportedly weighted to reflect the demographic profile of the United Kingdom.

In addition to the low level of investment knowledge in encryption, the survey also shows that the demand for digital assets is driven by FOMO or fear of missing out. About 35% of the respondents said they read widely about the soaring cryptocurrency prices, and 15% of the respondents said that their friends or family members encouraged them to invest in the industry. Greg B Davies, Director of Behavioral Finance at Oxford Risk said:

“The worrying thing is that too many people buy blindly without knowing what they are doing, and are influenced by price increases and others encouraging them to try. If people invest a lot of money in cryptocurrency and don’t understand what they are buying What’s wrong, that’s worrying.”

There is also a large number of people who are still uncertain about the future of the market: 45% of people answered that they don’t know whether prices will continue to rise, 32% don’t believe it will happen, and 24% believe it will. In any case, 21% of respondents plan to buy cryptocurrency for the first time this year or increase their current holdings.

It’s worth noting that most investors invested relatively little cash in the industry: 81% said they just bought a little cryptocurrency in the spirit of “see what happens,” 76% invested Less than 5% or less of funds. The total savings is 41%, less than 1%. However, 7% of investors invest 20% of their total assets in cryptocurrencies, while 10% of investors hold more than 10% of assets.

According to a recent study by the UK Financial Conduct Authority, 2As of June 2021, 300,000 adults in the country hold crypto assets, An increase from last year’s 1.9 million. In addition to the increase in the number of investors, FCA also found that the median position has risen from 260 pounds (370 US dollars) in 2020 to 300 pounds (420 US dollars).

This rise has been accompanied by increased levels of awareness, with 78% of British adults saying they have heard of cryptocurrencies-again up from 73% the year before. However, just like Oxford Risk, FCA stated that its understanding of cryptocurrencies has dropped significantly, which also shows that many consumers do not understand the technology and industry.