As a seasoned researcher who has witnessed the meteoric rise of cryptocurrencies since their inception, I must admit I’m both intrigued and cautious about the latest findings from the International Organization of Securities Commissions (IOSCO). The surge in retail crypto ownership among younger generations, particularly those under 40, is a testament to the growing appeal of digital assets. However, the rapid expansion of this market also raises red flags for regulators and seasoned investors like myself.
In various regions worldwide, an uptick in cryptocurrency ownership among individual investors has been observed, as reported by the International Organization of Securities Commissions (IOSCO) on October 9, 2024. This surge began around 2020 and comes amidst rising market volatility and regulatory hurdles.
Retail Crypto Ownership Surges to 30%
The research examined 24 regions, finding that around 15 of them indicated that at least 10%, and as high as 30%, of their retail investors owned cryptocurrency by the year 2023. Six areas specifically reported a higher adoption rate. This significant rise in ownership is noteworthy, considering that most regions reported ownership between 1% and 5% in the year 2020.
Photo: IOSCO
In a statement made since 2020, the International Organization of Securities Commissions (IOSCO) acknowledged that the crypto-asset sector has been experiencing constant development. Remarkably, this growth transpired even amid significant challenges, like the ‘crypto winter’ of 2022, which brought about a steep decline in the market. The report underscored the importance of investor education due to unclear regulations, ongoing fraudulent activities, and market volatility.
The report from IOSCO revealed that the cryptocurrency market has encountered numerous substantial hurdles during the last four years, such as notable bankruptcies, an extended downturn with indices plummeting by 73% from their highest points, and a spike in fraudulent activities like scams and hackings. Despite increased regulatory measures and enforcement, individual investors continue to show resilience.
Over the past four years, I’ve observed a growing curiosity among investors, especially newcomers like myself, towards crypto investments, as evidenced by multiple surveys, research, and reports.
Approximately six out of ten American investors under the age of 35 show interest in crypto investments, and more than half have already dabbled in this market. Interestingly, roughly 44% of Gen Z investors (aged between 18 to 25) in the U.S. are said to have started their investment path with cryptocurrencies.
Under-40s Dominate Crypto Investments
The analysis reveals that a significant number of retail cryptocurrency investors tend to be young males, typically under the age of 40. These individuals are frequently attracted to crypto for reasons such as its low barrier to entry, the desire to avoid missing out (FOMO), and the impact of friends and social media. Importantly, novice investors show a greater propensity to invest in digital assets compared to experienced ones, suggesting a growing fascination within younger demographics.
According to the report, numerous investors cited fear of missing out (FOMO) as a key motivator for investing in cryptocurrencies, with many obtaining information about these assets primarily from personal sources like friends, relatives, and online platforms such as social media.
On the other hand, the International Organization of Securities Commissions (IOSCO) emphasizes the importance of strengthening investor education and regulations to protect retail investors. Despite improvements, potential risks such as market volatility, fraudulent activities, and insufficient supervision continue to be concerns. Consequently, the report suggests a careful yet knowledgeable approach when investing in digital assets.
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2024-10-10 13:09