After the fraud scandal surrounding the crypto exchange FTX, a large majority of retail investors are continuing to hold on to digital currencies, a new study shows. Accordingly, in Germany, Switzerland, Austria and four other countries, on average, only 18 percent of private crypto investors have reduced their investments since autumn 2022.
Consulting firm Strategy&, part of the international accounting firm PwC, published the research on Wednesday.
Austrians are particularly cautious
Austrians are particularly cautious; in this country, 20 percent said they had reduced their crypto investments. In Switzerland it was 16 percent and in Germany 15 percent. Strategy& surveyed 3,798 private investors in August, including 1,000 in Germany and 500 in Austria and Switzerland. The remaining respondents lived in Poland, Turkey, Saudi Arabia and the United Arab Emirates.
Crypto optimists were in the majority everywhere. On average, significantly more investors in all seven countries – 34 percent – sold part of their crypto portfolio and then bought back in at a lower price. Fourteen percent sold nothing and even invested extra money; the rest kept their shares without buying or selling.
The collapse of the FTX caused a real price drop
In the fall of 2022, the American cryptocurrency exchange FTX collapsed. Before its collapse, the company was one of the largest trading centers for digital currencies such as Bitcoin. The collapse of the FTX resulted in a global drop in the price of cryptocurrencies, and last week a New York court found founder Sam Bankman-Fried guilty of billion-dollar fraud.
Even before the scandal, cryptocurrency had lost a lot of value. The best-known digital currency Bitcoin, for example, reached its all-time high of over $60,000 in the fall of 2021; a year ago the value of a Bitcoin was below $17,000 after the collapse of the FTX. Since then, the price has roughly doubled again.
“The crypto hype is not over yet, despite all the market collapses and turmoil within the scene,” said Philipp Wackerbeck, head of financial services at Strategy&. Many investors were looking to expand their crypto portfolios and were betting on holding their positions for the long term. However, the turbulence has not completely disappeared: according to the research, investors’ willingness to switch trading platforms has increased.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
