Exclusive: Investors cautiously bullish on Bitcoin
Retail investors are becoming increasingly optimistic about cryptocurrencies, as volatile market conditions cause people to consider adding the asset to their portfolio.
According to a survey of 2,537 retail investors from investment advice platform Finimize, nearly 70 per cent are more bullish on the opportunities offered from cryptocurrencies than equities over the next 12 months, up from 67 per cent the previous quarter.
The growing optimism in crypto marks the first time confidence in the digital currency has overtaken that of the stock market in three years, when it began to steadily creep onto people’s radar as a mainstream investment option.
The shift from speculative asset to viable choice was also marked by crypto climbing to become the third most popular investment option.
It comes as Bitcoin reached a record high earlier this month of $124,00 per Bitcoin (£91,370.75), before dropping sharply on Monday to $114,000 per Bitcoin after last week’s Federal Reserve interest rates decision caused many to flee to safer assets.
However, analysts predict this fall will not last due to the bullish sentiment of the market.
A desire to invest and lack of knowledge
Over a third of respondents said it is their preferred method, overtaking cash saving popularity for the first time, while 32 per cent expressed an intention to invest in crypto, up from 29 per cent last quarter.
The change in attitude comes after investors fled the stock market following Trump’s tariff decision, as well as concerns surrounding debt and the state of the US job market driving down the dollar’s valuation.
Carl Hazeley, chief executive of Finimize, said: “This appears to reflect retail investors’ positioning for current market conditions, with concerns around government debt levels deficits and dollar weakness driving interest in Bitcoin.”
However, many investors felt they lacked the knowledge to invest in crypto, with nearly a quarter wishing to know how to effectively hold and trade the asset.
This suggests better education surrounding crypto is needed, in particular with a growing number of Gen Z investors pooling capital into the asset.
Private markets failing to lure investors
Retail investors are still sceptical of the opportunities in private markets, despite financial advisers encouraging clients to diversify their portfolios in order to boost returns.
Nearly 70 per cent of investors said they had encountered private markets through social media or advisor outreach, but only a fifth are considering investing in the space, with only 10 per cent currently doing so.
Finimize credited this reluctance to factors including the minimum investment threshold, averaging £100,000 in the UK, and lack of knowledge of the market, with 20 per cent lacking confidence to take the initial step.
Hazeley said: “There’s clearly a gap between the private industry’s rhetoric and reality.”