As a seasoned crypto investor with over a decade of experience navigating this ever-evolving digital frontier, I can attest to the fact that financial literacy remains a significant challenge within our community. While it’s thrilling to be part of the crypto revolution, I’ve often felt like a blindfolded acrobat trying to balance on a high wire without a safety net – all while juggling virtual coins!
In light of Bitcoin approaching fresh price peaks, it’s clear that there’s still room for improvement in the financial understanding within the cryptocurrency sector, as indicated by recent findings.
Approximately one-fourth of individuals within the cryptocurrency community are financially literate, which is significantly lower than the national financial literacy average in the United States by approximately 50%, as suggested by a recent study conducted by PiP World, a gaming company specializing in crypto.
The study, published on November 26, was based on a survey conducted between March 2022 and October 2024. Over 12,000 anonymous responses from individuals within the cryptocurrency market were collected via the platform Coinfessions for this analysis.
In the study conducted by PiP World, they assessed a person’s knowledge and skillset to make sound financial decisions related to cryptocurrencies, using percentage scores and categorizing them as either “advanced” or “moderate” levels of financial literacy in the crypto sector.
Financial literacy in the crypto space is “dangerously low”
Despite the cryptocurrency community’s financial literacy level being just 8% below the worldwide average, it is still considered “alarmingly low” by PiP World CEO Saad Naja.
According to Naja, the conclusions drawn from this study reveal a pressing and indisputable fact: Financial understanding within the cryptocurrency market is perilously scarce.
He added that too many traders are “navigating blind” in a rapidly evolving market, lacking the “foundational knowledge needed to succeed.”
The research indicates that the emotional burden is significant within the cryptocurrency community, as they frequently admit to being quick-tempered, impulsive, and emotionally sensitive.
Approximately 7 out of every 10 crypto investors reported experiencing losses, and a substantial 76% of the surveyed individuals expressed remorse over their investment choices.
Whales and hodlers are among the most financially literate investors
Based on the research findings, it appears that some of the biggest players in the cryptocurrency market (representing about 5%) have shown exceptionally high levels of financial literacy regarding cryptocurrencies, with a rate as high as 96%.
Long-term crypto investors, representing approximately 11% of the total, tend to have a high level of financial knowledge, according to the study’s findings, with around 80% demonstrating strong financial literacy.
According to the report, PiP World identifies speculative traders as the group with the biggest stake in the crypto market, accounting for 29%, and it’s stated that their level of financial literacy is 64%.
Contrastingly, day traders, who make up around 6% of the total crypto investors in this report, tend to have the least financial literacy, with an estimated score of 27%. Similarly, those labeled as pump and dumpers, accounting for approximately 18% of crypto investors, are linked to a higher financial literacy level, at 45%.
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2024-11-26 17:15