73% of UK Consumers Say They Don’t Know What Cryptocurrency Is
Three-quarters of U.K. consumers don't know what a cryptocurrency is or can't define it, according to a survey by the nation's financial regulator.
Seventy-three percent of U.K. consumers don't know what a cryptocurrency is or are unable to define it, according to a new survey from the country's financial watchdog, the Financial Conduct Authority (FCA).
Thursday, the research indicates that those who are most aware of cryptocurrencies are likely to be men aged between 20 and 44.
The survey, which polled 2,132 British consumers in association with London-based market research firm Kantar TNS, further found that only 3 percent of those surveyed had ever bought cryptocurrencies.
Of those who had purchased, half of them spent under £200 ($263) from their “disposable income.” Bitcoin appears to be the most popular cryptocurrency, with over 50 percent purchasing the cryptocurrency, while 34 percent bought ether (ETH).
The FCA has also carried out “qualitative” research and interviews of UK consumers in association with London-based research agency Revealing Reality. They found that many consumers may not fully understand what they are purchasing, with several wanted to buy a “whole” coin, without realizing cryptocurrencies can also be bought in fractions.
“Despite this lack of understanding, the cryptoasset owners interviewed were often looking for ways to ‘get rich quick’, citing friends, acquaintances and social media influencers as key motivations for buying cryptoassets,” the FCA said.
Regarding risk to investors, the watchdog said the survey findings suggest that “currently the overall scale of harm may not be as high as previously thought.”
The FCA’s executive director of strategy and competition, Christopher Woolard, said:
Even so, these are "complex, volatile products," he added, and investors "should be prepared to lose all of their money.”
Back in December 2017, FCA CEO Andrew Bailey similarly said that buying bitcoin poses similar risks to gambling and, since it is neither backed by central authorities nor regulated, the cryptocurrency is not a safe investment.
The watchdog has also warned several times on cryptocurrency derivatives products and unregistered crypto brokerage firms.
In today's announcement, the FCA added that it will consult on banning the sale of certain cryptocurrency derivatives to retail investors later this year – a ban the authority has been considering since last November.
The FCA further said that it is working with the U.K. government and the Bank of England, as part of the country's Cryptoassets Taskforce effort to form regulatory guidelines for the cryptocurrency space.
Note pad image via Shutterstock
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.