Cryptocurrency investors are more diverse in terms of race, ethnicity and gender, and also have lower incomes compared to investors in the stock market, according to a survey by the NORC at the University of Chicago.
More than one third (35 percent) of survey respondents with an income less than $60,000 are investing in cryptocurrency, while 27 percent are choosing to invest in the stock market. Cryptocurrency investing is also more popular among people of color; 44 percent of respondents say they are investing in cryptocurrency, while 35 say they are investing in the stock market.
Slightly more women (41 percent) are investing in cryptocurrency than the stock market (38 percent).
However, more than half (51 percent) of people with a college education are investing in the stock market compared to 45 percent investing in cryptocurrency.
Overall, in the past 12 months only 13 percent of Americans report purchasing or trading cryptocurrencies while in the same period 24 percent of respondents report trading in stocks. However, investing in cryptocurrency is a relatively new investment choice, as most investors (61 percent) started investing in cryptocurrencies within the past six months.
‘Cryptocurrencies are opening up investing opportunities for more diverse investors, which is a very good thing,’ says Angela Fontes, vice president in the economics, justice and society department at NORC at the University of Chicago.
‘It will be important that these investors have access to sound information as they make decisions related to these often more volatile investments.’
Many still have concerns about cryptocurrencies
Out of the people not investing in cryptocurrency, only one in ten (11 percent) suggest that they are extremely or somewhat likely to begin trading in the next 12 months.
Almost two thirds of respondents (62 percent) state that the main reason they aren’t investing in cryptocurrency is that they don’t understand it enough. One third (33 percent) state that they do not have the money to buy into cryptocurrencies.
Other obstacles include concerns around security (35 percent), not knowing how to invest (31 percent), concerns about price volatility (30 percent) and not being able to spend it anywhere (11 percent).
‘Cryptocurrency is a relatively new option for retirement funds,’ says Mark Lush, a manager in the economics, justice and society department at NORC. ‘Potential investors are leery of investing their retirement savings into what has been, to date, a fairly volatile investment.’
‘Cryptocurrencies may have staying power as an investment option, but our hunch is that they will continue to lag behind more traditional investment opportunities for the foreseeable future.’