Will Crypto Investments Rise in 2019?
While traditional investments, such as stocks, real estate and government bonds, are still the favorites among US investors, the cryptocurrency market is growing and it shows. This market, which should not be underestimated, has attracted nearly as much interest as ETFs in the United States, according to a recent survey.
The survey, which was done The Harris Poll for the American Institute of CPAs (AICPA), showed that 35% of the Americans are planning to invest next year and that, from this number, 5% will use cryptocurrencies.
Exchange-traded funds (ETFs) would comprise 8% of the portfolios, for comparison, meaning that cryptocurrencies are definitely becoming mainstream as more and more investors start to look at them as a way to make money and store value.
Cryptocurrency Awareness Levels
The survey also tried to discover how many people in the largest economy of the world were aware of this new market. According to the data shown by the study, 50% of the adults in the United States do not understand cryptos.
It appears to foreign to many investors, as nearly half of the participants had never heard of Bitcoin, Ethereum and Litecoin, for example. This indicates that the awareness levels are still very low among the investors.
Those who knew about cryptocurrencies were divided. Some of them seemed to be more optimistic while others did not believe so much in a bright future, especially after the market has fallen from over half a trillion USD to under $200 billion USD from December to now.
Expectation For Future Prices
The data gathered by the survey shows that about 24% of the people who were familiar with cryptos expected the prices to rise, while 29% expected them to fall over time. Only 12% expected the prices to remain stable and 35% that the market will fluctuate a lot, which is not surprising since the market is so volatile right now.
It is likely that the negative sentiment toward cryptos mirrors the bad year that Bitcoin is having since it was valued at about $20,000 USD last year and now it only values about $6,500 to $7,000 USD recently.
The chair of the National CPA Financial Literacy Commission of the American Institute of CPAs (AICPA), Greg Anton, has affirmed that investors should make a good research before investing and find a diversified portfolio that matches the risk tolerance that they can have, which can be part of the reason why people are still not more eager to invest in cryptos.
The AICPA did not reveal any reason for cryptocurrencies constituting only 5% of the investment mix (although it should be clear that 5% is a large share for such a new asset). However, a recently study conducted by Gallup made for Wells Fargo identifies the high risk factor as the main stone in the way of the cryptocurrencies.
According to this other study, 75% of the investors stated that Bitcoin is very risky and 23% considered it at least somewhat risky, meaning that only 2% believe that there is not a lot of risk in investing in Bitcoin.
If the market stabilizes, there is a chance that all this might change, but we will have to wait until then to know with certainty whether the cryptocurrency market will ever become mainstream or not.