A recent analysis by researchers at the Federal Reserve Bank of Atlanta has shed light on the status of cryptocurrency adoption in the United States, revealing that it flatlined at 10% among U.S. adults in 2022. This figure marked a significant departure from the preceding two years, during which ownership had doubled annually.
The year 2022 witnessed a series of challenging events in the crypto world, with headlines dominated by plummeting prices, the apprehension of crypto industry leaders, and the decline of the NFT (non-fungible token) craze. Given this backdrop, it’s hardly surprising that many investors hesitated to exchange their fiat currency for digital assets.
The researchers at the Atlanta Fed, in their blog post analyzing data from the survey alongside cryptocurrency price trends, suggested that the allure of quick riches through crypto speculation had diminished in the aftermath of the market crash in the spring of 2022. They noted that feelings of euphoria, anxiety, and regret were all associated with the crypto landscape.
Although 2023 has proven to be a more favorable year for crypto investors, with Bitcoin rebounding to around $26,521 as of the analysis, up from $16,604 at the close of 2022, it still falls significantly short of its peak value of $67,617 attained in November 2021.
However, the researchers observed that few crypto investors seemed inclined to seize the opportunity presented by lower asset prices as a means of growth. Instead, they noted a trend opposite to the investing philosophy of Benjamin Graham, where investors typically buy during periods of weakness and sell during times of strength. In this case, crypto speculators appeared to be buying high and avoiding purchases when prices were low.
As the crypto market continues to evolve, the dynamics of investor sentiment and behavior remain complex and subject to various factors.
