- Nearly one in four Americans hold BTC, up by 13% on a year-over-year basis, according to a report by Grayscale Investments.
- Over the past 12 months, more than 50% of new investors acquired BTC, and 66% of them have held onto it.
- Nearly 80% of participants said they would invest in Bitcoin if a spot ETF existed.
The report notes that crypto adoption has grown exponentially within the last 12 months. During that period, more than 50% of new investors acquired BTC, and 66% of them have held onto it. Notably, more than 90% of those who have unloaded their BTC raked in a profit.
“While big banks continue to grapple with how to engage with Bitcoin, mainstream adoption has arrived,” the report says, which has surveyed 1,000 US customers. The respondents were between the ages of 25 and 64 with at least $10,000 in household investable assets and $50,000 in income.
Interest in Bitcoin has continued its upward trajectory. Nearly 60% of surveyed investors said they are interested in BTC, up from 55% in 2020 and merely around 35% in 2019. When describing why the pace of growth has slackened, Grayscale said:
While the pace of growth has slowed slightly (comparing the rate of growth from 2019 to 2020 and from 2020 to 2021), Bitcoin was coming from a lower base two years ago when it was still viewed by some as “very high risk” or “only a fad.”
It is worth noting that investors now tend to acquire Bitcoin using a cryptocurrency trading app like eToro or Coinbase. This is in contrast to 2020, when the majority preferred to use crypto exchanges to get exposure to Bitcoin. More precisely, 59% of investors purchased Bitcoin via trading apps, compared to 35% who use Bitcoin exchange.
Meanwhile, the use of fintech applications like Venmo or CashApp for buying Bitcoin has also increased. Over the last 12 months, 30% of investors have used these fintech apps to purchase Bitcoin. This explains why PayPal has been eager to expand its crypto offerings, launching crypto capabilities in the UK.
Investors are Waiting for Bitcoin ETFs
Surveyed investors claimed that a physical Bitcoin ETF, one that tracks spot BTC prices, would have a significant impact on Bitcoin investments. Nearly 80% of participants said they would invest in Bitcoin if a spot ETF existed.
However, the US SEC has been suspicious of spot ETFs, claiming that such products bring additional risks to investors. The regulatory body has approved several Bitcoin futures ETFs, but Grayscale says investors are not “satisfied” with these funds.
As covered by FullyCrypto, BTC futures ETFs are expected to underperform spot prices by 8%. Moreover, due to their complex nature, there is also the possibility of major losses with these ETFs, which is why experts have been warning retail to stay away from these. For instance, Tyrone Ross, CEO of Onramp Invest, said:
This [BTC futures ETF] is not something for retail investors to buy, in my opinion. There’s plenty of outlets to buy bitcoin directly. Buying into a futures ETF, where the average retail investor does not understand ETFs or futures, which are complicated, is not the best product for retail investors.