New research shows that fewer Australians are embracing cryptocurrencies (crypto) after the drop in their value in 2022. However, the sharp fluctuations in prices have not deterred a section of the population from delving deeper into crypto.
According to a new report by digital currency exchange Independent Reserve, the Independent Reserve Cryptocurrency Index (IRCI), which measures the level of awareness, trust, confidence and acceptance of digital currencies among the Australian population, has fallen from 54 to 45 in 2022.
The decline reflects lower ownership rates, fewer people making a profit, and a decline in medium-term confidence as the prices of Bitcoin and other digital currencies have fallen dramatically from their 2021 highs.
Specifically, Australians’ overall crypto ownership fell from 28.8 percent in 2021 to 25.6 percent in 2022.
The biggest drop was recorded in the 18 to 24 age group, with ownership falling from 55.7 percent to 33.3 percent.
Contrary to the overall trend, the percentage of Australians investing $500 (US$333) or more per month in crypto rose from 10.3 percent in 2021 to 17.3 percent in 2022.
Similar growth was also seen in those investing between $1 and $100 per month, with the percentage of participants jumping from 11.6 percent to 26.5 percent.
This suggested that some Australians saw the decline in crypto’s value as an opportunity and decided to invest more to take advantage of the lower prices.
“Our 2022 survey results reflect the period of global market uncertainty we are currently experiencing,” said Independent Reserve CEO Adrian Przelozny.
“Despite this volatility, the 2022 IRCI data clearly shows that Australians’ interest and investment in crypto remains high and continues to gain momentum.”
Older Australians are interested in Crypto
While the 18- to 24-year-old group was behind the drop in overall crypto ownership, other age groups showed greater interest in this type of digital asset.
Notably, ownership among respondents aged 35 to 44 reached 46 percent in 2022, up from 38 percent in the previous year.
For 45- to 54-year-olds, ownership grew from 25.3 percent to 27 percent.
In comparison, 11.4 percent of 55- to 64-year-olds claimed to hold crypto (up 1.7 percent), while the figure for the 65-plus age group was 5.1 percent (up 1.2 percent) .
Crypto is becoming more popular among Australians
The report indicated that general awareness of cryptocurrency grew slightly to 92 percent in 2022, with Bitcoin still the most familiar digital currency (91 percent), followed by Ethereum (43 percent) and Dogecoin (36 percent).
Meanwhile, family and friends remained the most influential factor influencing crypto adoption, with 49.2 percent of respondents citing it as the reason for their investments, followed by media coverage and portfolio diversification.
Despite the growth in public awareness, Przelozny said regulation was struggling to keep up and adapt to the changes in the crypto sector, which was reflected in the attitudes towards digital currencies of many Australians.
The survey found that more than a third of respondents see a lack of regulation and consumer protection as the main reason preventing them from adopting crypto, up from 24.8 percent in 2021.
“As more Australians invest in digital assets, it is critical that we have a robust and competitive regulatory, tax and policy framework dealing with these assets,” the report said.
Tens of thousands of Australians affected in FTX’s collapse
The report came after the collapse of popular crypto exchange FTX, which put 30,000 Australian investors in a precarious situation.
The affected FTX customers have been trying to recoup some of their losses, with many of them now facing significant financial difficulties.
The Australian Financial Review reported that KordaMentha, the administrator of FTX Australia’s liquidation process, had received hundreds of emails from affected customers across the country asking for their money back, with losses ranging from $40,000 to $1 million.
The administrators found $3 million in an FTX Australia account and another $39 million in an account linked to FTX Express, but they warned that significant sums were still outstanding.
KordaMentha said the firm has started responding to the inquiries from thousands of FTX customers and creditors it has received and has advised concerned parties to remain patient due to the complex administration process.
The first virtual meeting of FTX creditors will be held on 1 December at 11am AEDT, where KordaMentha will provide an update on the administration process.
Creditors will also have to decide whether to appoint a committee of inspection at the meeting.