During the latter part of 2019, cryptocurrencies took a bit of dive, none more so than the mighty Bitcoin. However, at the start of 2020, things started to look up again. More people started to buy crypto in January, but the real spike came in February when most of the world decided to go into lockdown.
Throughout the months of February to May, when the virus was running rampant and peaked, the average was maintained. According to experts, if the historical growth rates of Bitcoin could be maintained, then it would exceed the daily volume of all the US bonds and equities in less than five years.
However, the question that is driving economists up the wall is where this massive investment is coming from.
According to Bitcoin of America, the virtual currency exchange platform, numbers paint a pretty picture for the future of cryptocurrencies when one considers that 15% of all American adults now own some form of cryptocurrency.
The vast majority of them being people who started investing in 2020 for the first time. It is estimated that the new buyers accounted for a growth of over $65 billion in cryptocurrencies at a rate of around $4000 per individual.
Prior to this year, the total investment for crypto for Americans stood at $111 billion, with an average of $7000 per individual. This means that the US ranks under the top ten countries in the world in terms of its Cryptocurrency adoption rate says a report by TheMoneyMongers.com, a crypto research firm based in India.
When one considers who is buying cryptocurrencies, it boils down to those who are tech-savvy and have extra money to invest. Nearly 8 out of 10 people who invested in crypto in 2020 were high income and well-educated men.
The millennials and Gen-Xers accounted for around 57% of the consumers who bought into crypto, with the Millennials taking charge at 27%. The baby boomers are way too skeptical and only account for around 3% of the market share.
Although it might be hard to prove that cryptocurrencies are the cause of good financial health, but the numbers tend to suggest just that.
A significant 44% of Americans who have already invested in Bitcoin and other cryptocurrencies are of the opinion that they are better off financially after the Coronavirus surge. When compared to the rest of the American consumers, only 5% reported better financial positions.
The growth of Bitcoin and cryptocurrency investments dropped down again and then in August, started rising up again. Now, the next generation of investors is looking much different than before. At present, women make up only 22% of the total number of investors. The next wave is set to increase that number to 35%.
Another group of individuals who are also set to join the next wave is the African-American population and Hispanic consumers. For the current wave of investors, these two ethnic groups only make up around 23% of the total number of investors. Of the 11% of the next wave of consumers, their numbers are set to increase to the 37% mark.
The Baby boomers and Gen-Zers are also coming to the party and of the next wave, they will collectively take up 17% of the market share. This number also coincides with the number of uneducated, which will now make up 18% of the total.
In the beginning of 2020, Square’s shares skyrocketed and it only serves as a precursor to what banks can expect in the future. Many banks do not allow any cryptocurrency transactions with their issued cards, but they might very soon be forced to join the party and offer more crypto-related products if they are to grow with the times.
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