According to a new report from the Bank for International Settlements (BIS), bitcoin investors are more likely to be drawn in by the cryptocurrency's rising prices than by their dislike of banks or its perceived utility as a store of value.
The central bank body looked into the connection between Bitcoin prices, crypto trading, and retail adoption in a "BIS Working Papers" report published on November 14.
It investigated the factors that influence cryptocurrency adoption among retail investors, using crypto trading app downloads as a proxy for adaptation and user investments at the time of download.
The BIS provided evidence that daily downloads of crypto exchange apps rose in tandem with Bitcoin's rapid price surge between July and November 2021, peaking when Bitcoin's price was between $55,000 and $60,000, roughly one month before its all-time high of just over $69,000 in November 2021.
It went on to say that 40% of crypto app users were men under 35 and that they belonged to the most risk-seeking segment of the population.
The BIS assumed that app users bought Bitcoin when they downloaded a crypto app and that up to "81% of users would have lost money" if they bought Bitcoin worth more than $20,000.
The firm’s assumptions appear to be consistent with data from blockchain analysis firm Glassnode, which confirmed on November 14 that just over half of Bitcoin addresses are profitable, a two-year low.
It also documented the geographic distribution of crypto app adoption, discovering that between August 2015 and June 2022, Turkey, Singapore, the United States, and the United Kingdom had the highest overall downloads per 100,000 people, in that order.
India and China had the lowest, with the latter seeing only 1,000 crypto app downloads per 100,000 people, according to the BIS, with greater legal restrictions on stifling retail adoption in those countries.
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