But Are Users Aware of the Risks? Around half a million people in Ontario own cryptocurrency, but many don’t understand the risks that come along with it.
According to a new study from the Ontario Securities Commission, many Ontarians, who own cryptocurrencies, don’t understand it well and don’t fathom the risks associated with it entirely.
The study, titled Taking Caution: Financial Consumers and the Cryptoasset Sector said that that five per cent of Ontarians currently holds some form of cryptocurrency asset. Five per cent would mean that around 500,000 people own Cryptoassets. That is no small number, especially considering the limited reach and high risks of cryptocurrency.
However, not all owners of cryptocurrency have invested millions on it. According to the data, most investors spent less than $1,000 buying a cryptocurrency and only around nine per cent of cryptocurrency owners spent more than $10,000 on it.
“The results of this survey indicate that the vast majority of Ontarians are approaching crypto assets with caution. Only a small percentage own crypto assets, and those who do own them tend not to spend substantial sums of money acquiring them”
The survey did say that Ontarians are eyeing cryptocurrency with caution, but numbers show that they, however, still proceeding to invest nonetheless.
“The results of this survey indicate that the vast majority of Ontarians are approaching crypto assets with caution. Only a small percentage own crypto assets, and those who do own them tend not to spend substantial sums of money acquiring them,” the report said.
However, Ontario’s large population means that even small percentages can collectively translate into substantial numbers – numbers sufficient to concern the OSC as a securities regulatory authority.
Another part of the report read, “Also of concern is that the survey found many Ontarians are confused about whether token generation events, Initial Coin Offerings (ICOs), and initial token offerings are subject to regulation,”
Men aged 18-34 were substantially more likely to own cryptocurrencies than the general public, with 14 per cent reporting that they currently own a crypto asset.
Those who invested in cryptocurrencies cited various reasons including enthusiasm for technology, blockchain technology’s potential to prevent loss and fraud and the hope of selling the cryptocurrencies at a higher price later. Around 25 per cent of cryptocurrency investors said they wanted to use it as a medium of exchange with a significant per cent saying they want to make payments anonymously.
Unsurprisingly, scepticism in institutions was also a reason for acquiring cryptocurrency. Around 12 per cent of crypto investors said they bought crypto assets because they have low trust in banks while 11 per cent said they had little trust in government.
Most Crypto Asset Buyers Weren’t Sure Where to Go With a Complaint or Who Regulates ICOs: Study.
Cryptoassets began to emerge in the wake of the global financial crisis, with Bitcoin launching in 2009, and various “Altcoins” (digital coins meant as alternatives to Bitcoin) emerging beginning in 2011. Early adopters, who tended to be younger, tech-savvy users alienated by traditional financial services, were attracted to the notion of having a store of value not governed by any central authority.