BIS rules out distrust of consumer finance as a crypto engine

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Investing in crypto in the United States is not motivated by a distrust of the traditional financial sector, but by the possibility of making a profit, according to the Bank for International Settlements (BIS), an organization that represents most of the world’s central banks.

Cryptocurrencies are “not in demand as an alternative to fiat currencies or regulated finance, but rather a niche digital speculation project,” the BIS said in a report released Thursday.

The newspaper, “Mistrust or Speculation? The Socio-Economic Drivers of US Cryptocurrency Investments, ”explored whether crypto is popular due to mistrust of mainstream finance.

The BIS said it could rule out this idea on a preliminary basis, as it found that there was no difference in the perceived security of cash and offline and online banking between crypto owners and not. -crypto. People with more security concerns regarding fiat currency may seek information on crypto, but ultimately decide not to invest, the document suggests.

Crypto owners are more likely to find cash and traditional banking services less convenient, although this does not apply to online banking.

A higher level of education increases the likelihood of owning a crypto, according to the BIS. This corresponds to the broader financial markets, where participation increases by 2% with each additional year of study. Participation in crypto markets is consistent with this, the BIS said.

Crypto owners also have above average household incomes.

Breaking down trends on different crypto assets, the paper finds that XRP and Ether owners are likely the most educated, with Litecoin owners the least. Bitcoin ranks in the middle. The owners of XRP and ETH, as well as stellars, are also likely to be the wealthiest crypto owners.

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