Research Note: Cryptoassets consumer research 2023 (Wave 4)

Also concurrent to the publication of a final policy statement (PS23/6) as regards financial promotion rules for cryptoassets (please see EventID 21585 for a detailed description), the Financial Conduct Authority (FCA) has published a research note entitled Cryptoassets consumer research 2023 (Wave 4) in same context. The research was performed to find out about the general level of comprehension of cryptoassets, potential risks cryptoassets may pose to customers, and investor behavior following recent declines in cryptoasset values and the rise of inflation. The study involved the questioning of 2,337 UK adults and was conducted in August 2022. The key findings of the study are noted below – for more detailed, comprehensive information, please refer to the research document itself.
#### Key findings
Here are the key findings from the research:
1. Public Awareness:
– The awareness of cryptoassets among adults has significantly increased, with 91% of surveyed adults stating they have heard of cryptoassets (in 2021, this figure was 78%).
– Three-quarters of adults (74%) correctly understood the definition of cryptoassets.
2. Ownership and Value:
– The number of UK adults holding cryptoassets has risen to 4.97 million, accounting for almost 10% of ALL UK adults. This is more than double of the 2.3 million in 2021.
– The average value of cryptoasset holdings is £1,595.
– 39% of owners hold their cryptoassets for 1-2 years on average, and nearly 40% hold less than £100 worth of cryptoassets.
– 46% of cryptoasset owners reported that their holdings are currently worth less than their initial purchase value.
– The primary reason for purchasing cryptoassets is still perceived as a gamble (40%).
3. Experience of Owning Cryptoassets and Potential Harm:
– Among cryptoasset owners, 21% believe they can file a complaint in case of issues with their holdings.
– Of those, 50% thought they could complain to the cryptoasset exchange, 22% to their wallet provider, 7% to their bank, 7% to the Financial Services Compensation Scheme, and 3% to the Financial Ombudsman Service.
– 28% of non-cryptoasset users expressed a higher likelihood of buying cryptoassets if the market and activities were regulated.
4. Attitudes towards Cryptoassets:
– 14% of surveyed individuals regretted purchasing cryptoassets.
– 55% of cryptoasset owners were comfortable trading in the unregulated market.
5. Stablecoins:
– 10% of respondents were familiar with stablecoins, and 17% correctly identified their definition.
– 15% of cryptoasset users have purchased stablecoins.
– Stablecoins tend to appeal more to younger adults (18-24), while cryptoassets, in general, are more commonly held by adults aged 25 through 44.
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It may be worth noting that the study is a highly valuable tool by informing the FCA of ongoing risks and issues in the cryptoassets market. It has explicitly made the FCA aware that most individuals found that they can file a complaint in case of issues surrounding their holdings. In fact, it was these findings, that triggered the revisions to the „warning statement“ to make it clear, straightforward, without any doubt as to its meaning.