Owning crypto has nothing to do with distrust of Fiat: BI Research
The Bank for International Settlements (BIS), a global financial institution owned by some of the largest central banks in the world, seeks to dispel the theory that owning cryptocurrencies is linked to distrust of traditional finance.
On Thursday, the BIS published an article on the socio-economic dynamics of crypto investing in the US. Using representative data from the US Consumer Payment Choices Survey, the BIS argues that distrust of fiat currencies like the US dollar has nothing to do with investor dynamism in holding cryptocurrencies like Bitcoin (BTC), stating:
“The demand for cryptocurrencies is not driven by distrust of cash or the financial industry, as there is no difference in the perceived security of cash and offline and online banking. Therefore, we can provisionally refute the hypothesis that cryptocurrencies are being sought as an alternative to fiat currencies or regulated finance. “
The authority emphasized that cryptocurrencies are not sought as an alternative to fiat currencies or regulated finances, but rather as a “real digital speculative object”. The BIS notes that, from a policy perspective, the overall result of the analysis is that investor objectives are “like other asset classes, so regulation is needed”.
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The BIS article also outlines the key correlations between crypto investment decisions and education and income, showing that crypto owners “are generally more educated than they are”. Ether (ETH) and XRP investors are the most educated on the BIS analysis, while Litecoin (LTC) holders are the least educated, with Bitcoin holders in the middle.
The new report brings with it considerable relevance that cryptocurrencies like Bitcoin do not pose a threat to traditional financial instruments, as the demand for crypto is not driven by distrust of money. A number of global agencies and organizations have previously expressed concern about Bitcoin’s ability to capitalize on global distrust of traditional finance.
In late December, Morgan Stanley Investment’s Ruchir Sharma argued that the US dollar’s reign would likely end due to global distrust of traditional finance, while Bitcoin would capitalize on the lack of trust.