After last year’s market crisis, younger investors are less frightened of the cryptocurrency industry, according to the report.
Despite witnessing what is perhaps the greatest bear market in crypto history, the majority of retail investors remain keen on investing in digital assets.
According to a new study conducted by the social trading platform eToro, more than two-thirds, or around 69%, of retail investors are optimistic or have mixed sentiments about the effect of last year’s protracted market decline. The remaining one-third, or around 31%, said that they are hesitant to invest in the sector after the catastrophe.
Ben Laidler, eToro’s Global Markets Strategist, commented on the growing interest of ordinary investors as follows:
“After the worst year for markets in a decade, it may seem baffling that two-thirds of retail investors feel neutral or even more optimistic. The bulk of this group thinks in terms of years and decades. Those with longer time horizons have the opportunity to purchase firms at lower values by the end of 2022, enhancing the prospect for long-term gains.
The analysis, which polled 10,000 retail investors from 13 countries and three continents, found that investors’ diminishing anxiety about the perceived danger of inflation is the primary driver of their newfound trust in crypto investments.
At the conclusion of the third quarter of 2022, around 24% of retail investors said that inflation posed the greatest danger to their investment portfolios.
At the end of 2022, just 19% of respondents were concerned about inflation, while 22% mentioned the global recession as the greatest danger to their investment portfolios in 2023.
As a consequence, many investors are modifying their portfolios by increasing their cash allocation to 50 percent and adding defensive assets like healthcare and utilities.
The poll also revealed that younger investors had the least amount of concern about the cryptocurrency market, while elderly investors who are approaching retirement are more hesitant.
About 76% of young retail investors between the ages of 18-34 feel optimistic or neutral about the decline, while just 60% of senior investors over the age of 55 feel the same way.
“2022 will be the first significant bear market for many retail investors with less experience, but the data indicates that older investors with shorter retirement horizons are feeling the squeeze the most,” the researchers noted.