US investors are showing decreased interest in buying crypto compared to previous years, as risk-taking behavior has diminished, according to a study by the Financial Industry Regulatory Authority.
The proportion of crypto investors remained stable at 27% from 2021 to 2024; however, the percentage of those considering buying more or entering the market for the first time fell to 26% in 2024 from 33% in 2021, as reported by FINRA on Thursday.
The industry regulator observed a decrease in investors with “high levels of investment risk,” which dropped by four percentage points to 8% between 2021 and 2024. The most significant decline occurred among those under 35, decreasing by nine percentage points to 15%.
Investment in crypto generally tends to rise during times of significant optimism in the macroeconomic environment, but the current uncertainty regarding interest rates, inflation, and the economy likely led investors to gravitate towards safer assets.
Crypto seen as risky but vital for financial objectives
FINRA’s study, conducted from July to December 2024 with 2,861 US investors and a comprehensive online survey of 25,539 adults, revealed that 66% of respondents categorized crypto as a risky investment, up from 58% in 2021.
Nonetheless, one-third of investors indicated they believed taking significant risks was necessary to achieve their financial goals, which rose to 50% among respondents aged 35 and younger.
Around 13% of investors, including nearly a third of individuals under 25, also reported investing in meme stocks and other trending investments.
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New investor momentum slows
The arrival rate of new investors has also declined since 2021, with only 8% reporting they entered the market in the last two years leading up to 2024, down from 21% in 2021.
“The influx of younger investors who joined the market early in the pandemic, noted in the 2021 NFCS, has reversed course since the pandemic ended, aligning the share of US adults under 35 who invest back to 2018 levels,” FINRA remarked.
Overall, FINRA’s findings suggest a “modest trend towards more cautious attitudes and behaviors” compared to the 2021 survey.
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