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Gallup Poll: 26% of U.S. Investors ‘Intrigued’ By Bitcoin (BTC)

Bitcoin (BTC)–Potential adoption for the top ranked cryptocurrency by market capitalization looks a whole lot better following the release of a new Gallup poll.

On Friday, the results of a Wells Fargo/Gallup poll revealed that while only a small percentage of Americans are currently invested in Bitcoin, over a quarter of investors are intrigued by the cryptocurrency. The study’s published results found that 2 percent of U.S. investors polled reported owning BTC, while 26 percent said they were ‘intrigued’ by the prospect of investing in the high profile cryptocurrency. In addition, three in four investors who had heard of Bitcoin reported it to be “very risky” as a source of investment, reflecting the typical sentiment of general media outlets that focus on the price volatility of the currency.

Gallup, Inc., an American research based company, is widely regarded as one of the most comprehensive analytics firms for public opinion polls across the globe. Between May 7 – 14 of this year, the company conducted an online survey among U.S. investors with more than $10,000 in stocks, bonds and/or mutual funds. The results of the poll reflected a general lack of understanding about cryptocurrency by much of the investment market, as well as the aforementioned fixation on price volatility. While 96 percent of polled investors had heard of Bitcoin, only 29 percent reported knowing something about digital currencies, with another two-thirds of investors reporting having heard of other cryptocurrencies but not knowing much about them. Price volatility and risk emerged in the poll results, with 75 percent of polled investors reporting BTC to be “very risky,” and another 23 percent calling it “somewhat risky.”

As the papers outlines, polled investors seemed to ignore or not be entirely aware of Bitcoin’s utility as a tool for digital payment, instead choosing to focus on the price volatility that provides potentially high reward but for a tradeoff in risk,

“[Bitcoin’s] more popular as a high-risk/high-reward investment than as an online currency — although acceptance of Bitcoin for electronic payments is growing.”

Younger males made up the largest demographic for being aware or invested in Bitcoin and other digital currencies, with a divide in age difference also revealing a similar statistic for younger investors with less capital,

“investors with less than $100,000 in investments (who tend to be younger) are more likely to be familiar with the innovation than those with higher asset levels.”

The poll concludes that Bitcoin, in large part due to 2018’s sharp decline in price, is still primarily viewed by many investors as a bubble, with the majority of uninvested respondents preferring to wait and see how the price swing plays out,

“The price of bitcoin is back on an upswing after crashing earlier this year, causing some to say its bubble is again about to burst and others to argue that its value will only accelerate as more merchants inevitably adopt it. For now, most investors are on the sidelines, knowing little to nothing about bitcoin. Few are already invested in it, and even fewer plan to jump in soon.”

Clearly education, particularly in the form of greater understanding about what cryptocurrencies are, how they function, and what the underlying technology provides to both the world and financial markets would help improve the adoption of the currency with well capitalized investors.

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CEO of Xapo Predicted Bitcoin (BTC) Trajectory Years Ago

Bitcoin (BTC)–Wences Casares, Argentinian tech entrepreneur and founder of Xapo, has been a proponent of Bitcoin since nearly the inception of the currency. While he has made bold claims that the innovation of Bitcoin and cryptocurrencies will be bigger than the internet in terms of global impact, his draw to digital currencies has been shaped from his experience living in inflation-heavy countries, such as Argentina. For Casares, Bitcoin not only offers a secure means for digital payment, but an immutable store of value that can cross global borders without the interference of government oversight.

As Bitcoin continues to gain steam again following 2018’s prolonged bear cycle, the inevitable public scrutiny will once again fall on the currency for its utility and use in real-world scenarios. In January, we saw Bitcoin transaction volumes reach a peak that caused widespread network congestion, causing fees to spike and transfer times to crawl to a halt. Some, particularly BTC detractors, saw the failure of Bitcoin to scale as an indictment of the technology. Others simply realized that Bitcoin is still a work in progress. For now, the currency’s role as a digital asset is still valuable, particularly to the billions of unbanked individuals around the globe.

This preference for store of value was captured in the book Digital Gold, as a conversation that took place years ago between Casares and the widely renowned, Oracle of Silicon Valley Reid Hoffman. Hoffman was arguing that few people, especially in the U.S., found fault with the process of using debit or credit cards and would have trouble making the transition to cryptocurrency. Casares countered with an overview of Bitcoin’s trajectory that has proven to be accurate. Author Nathaniel Popper writes,

“Wences agreed with Hoffman that Bitcoin was unlikely to catch on as a payment method anytime soon. But for now, Wences believed that Bitcoin would first gain popularity as a globally available asset, similar to gold. Like gold, which was also not used in everyday transactions, Bitcoin’s value was as a digital asset where people could store wealth.”

As Bitcoin climbs back into the general media’s spotlight, it is worth reviewing some of the repeated, and tired, arguments against the currency.

Bitcoin is a cryptocurrency, it is not all of cryptocurrency. Those outside of the industry of cryptocurrency seem to have a deep misunderstanding of the difference between Bitcoin and cryptocurrency–in all its variations. Yes, Bitcoin can be hailed as the original cryptocurrency (in its modern form), and holds an overwhelming proportion of both market capital and household name appeal. But Bitcoin is not cryptocurrency. The failures of BTC, at least in its present state, from rising costs of mining to the inability to scale the network to useful levels, are not the flaws of the industry. While the world arguably doesn’t need the 1500+ cryptocurrency projects littering the landscape and clogging the perception of the field, it can surely do with a handful that offer unique functionality. There’s no reason why the world cannot entertain a recognizable, flagship cryptocurrency, such as Bitcoin, as a primary digital asset for the store of wealth, while also having other currencies that accomplish global utility like remittance and fee-less payments. Likewise, the rise of Dapps and coin tokens also gives the industry an outlet in decentralized networking features, in addition to the traditional perception of transacting currencies.

Assuming the volatility of cryptocurrency is inherent to the technology. For whatever reason, economists cite the volatility of cryptocurrency at present as being an inherent flaw to the underlying technology and system of operation. Volatility is the result of an emerging market, with a concentration of wealth in a disproportionate userbase, having the expectation that it will function as smoothly as the stock market.

For one, the investment base is much smaller. Adoption in cryptocurrency is minuscule compared to the global market, and holds less of the entrenched practices of the traditional stock market. Two, the capital volume is vastly different. Cryptocurrency, at its peak, commanded a market cap of over 800 billion USD. The present U.S. stock market has a capitalization approaching 30 trillion USD. To compare the two in terms of stability is comparing two different entitiies. Three, it’s clear that investors are uncertain what the worth of cryptocurrency should be–which is plausible given the early state of the industry–and the market reflects that erratic pricing structure. As mentioned earlier, crypto is an emerging market. Currencies don’t have the same layering as investing in stocks or other assets, and instead rely upon the sway of the market to dictate price. Higher volume of adoption in addition to a clearer purpose for cryptocurrency projects–and higher standard for what gets funded–will smooth out the volatility in due time.

It’s a fallacy to label volatility as an intrinsic property of cryptocurrency. The modern conception of banking stretches back more than 5,000 years. The world has only had cryptocurrency for less than a decade. Give it time.

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