What do Crypto-asset Owners Know About Their Investments?

Crypto-assets have been highly publicized in recent years. Even with this attention, recent research shows crypto-assets still remain mysterious to consumers in Canada and abroad.

In this article, we have compiled and highlighted key information from two separate studies which examine public understanding of crypto-assets. We also provide some educational resources to help you learn more about Crypto Assets.

Studies Reveal Mistakes and Traits Common Amongst Crypto-Investors

Studies in Canada and the UK have suggested that many consumers don’t understand, or overestimate their understanding of what they are purchasing when they invest in crypto-assets.

Common Crypto-Investor Misconceptions and Mistakes

  • Some consumers expressed interest in purchasing a whole coin – not realizing they could purchase part of one.
  • Some consumers seemed to believe that they were purchasing tangible assets.
  • Many consumers didn’t appear to have any strategy to sell their assets.
  • Some investors purchased their investments without conducting any due diligence.

Common Traits amongst Crypto-Investor

  • A majority of consumers didn’t know what crypto-assets were or were unable to define the term.
  • In both studies, the most aware demographic, and most likely owners of crypto-assets, were men between the ages of 18-44.
  • Crypto-asset owners seemed to be looking for ways to get-rich-quick – citing friends, acquaintances, and social media influencers as key investment decision motivators.
  • The majority of crypto-asset owners said they used disposable income to invest.
  • Some consumers are appear to be aware of the potential risks associated with crypto-asset investments and express that the risk is part of the attraction.

Studies Highlight Consumer Experiences with Crypto-Assets

Consumers in one of the studies who acquired crypto-assets using a crypto-asset trading platform, reported experiencing issues using these platforms, including:

  • A halt in trading;
  • Problems withdrawing money from their account;
  • Problems transferring money into their trading platform account; and
  • Not understanding the fees they are being charged.

Learn More about Crypto-Assets

Crypto assets include cryptocurrencies, blockchain companies, cryptocurrency funds, and Initial Coin Offerings (ICOs) and Initial Token Offerings (ITOs).  To learn more, watch our What are Crypto Assets video –  it explains four basic types of crypto assets.

Watch our blog for a Guide to Crypto Assets that will be published in mid-May.

Report a Concern

If you have any concerns about a person or company offering an investment opportunity, please contact BCSC Inquiries at 604-899-6854 or 1-800-373-6393 or through e-mail at [email protected]. You can also file a complaint or submit a tip anonymously using the BCSC’s online complaint form.

InvestRight.org is the British Columbia Securities Commission’s investor education website. Subscribe to receive email updates from BCSC InvestRight.

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