A new survey from Finder suggests that 25% of Aussies have either bought or plan to buy a cryptocurrency in 2021.
Finder surveyed 1,004 people, and found the increase in value of cryptocurrencies is a key driver for 45% of those who invest. Two cryptocurrencies have had a price spike just this week. Tesla’s $US1.5 billion investment in Bitcoin sent values soaring. Dogecoin, which started out as a parody cryptocurrency, hit record highs after a couple of celebrity tweets.
Other reasons for investing include to diversify portfolios (19%) and to hedge against inflation (12%). FOMO, or fear of missing out, is a factor for 8% of investors.
Finder tipping investment in crypto to increase
Finder’s cryptocurrency editor Andrew Munro says that the upward trend towards crypto is likely to continue as Aussies become more savvy with their money.
“Australians took the opportunity to diversify their income during the pandemic, with many now ready to look beyond traditional means for wealth generation,” he said in a press release.
“The recent cryptocurrency boom attracted a lot of new investors into the space who are excited to add a new stream of income to their wealth portfolio.”
The survey also shows Millennials are 11 times more likely to engage with cryptocurrency than baby boomers.
“It’s particularly encouraging to see younger generations being more engaged with their finances, proving that investing isn’t just for hedge fund managers on Wall Street,” Munro said.
Smaller players getting traction
According to Finder, the most popular cryptocurrency is Bitcoin (13%) followed by Ethereum (6%). Ripple (5%), Litecoin (4%) and Bitcoin Cash (4%).
Munro believes that some of the newer players are likely to become household names in the coming years.
“Five years ago, names like Dogecoin and Ethereum would have held little meaning for those outside the crypto community,” he says.
“Now we are seeing these names all over mainstream media, which is likely to make cryptocurrency feel like a more accessible option for budding investors.”
Munro says that investing in cryptocurrency has a lot of potential but, as with any investment, there is a level of risk.
“Doing the proper research is key to minimising that risk and staying on top of your money.”
Photo by Austin Distel on Unsplash