During 2022, the collapse and collapse of major crypto institutions triggered a massive selloff. Despite this, a recent report from Paxos shows that the majority of crypto users in the US have no qualms about continuing to hand over their funds to intermediaries.
2022 was a tumultuous year for the crypto industry, marked by volatility and uncertainty. However, despite the challenges, the industry continued to grow and develop. More and more people around the world are adopting cryptocurrencies and blockchain technology.
Despite a volatile year for cryptocurrencies, enthusiasm for this asset class continues to grow. Significant fluctuations have been observed in the price of cryptocurrencies such as Bitcoin, Ethereum and others. But, several factors contribute to the ongoing enthusiasm for these digital assets.
Investor Outlook on Cryptocurrencies
One of the main drivers of this enthusiasm is the adoption of cryptocurrencies by mainstream institutions and investors. For example, major companies have invested heavily in bitcoin, while financial institutions such as JP Morgan and Goldman Sachs provide cryptocurrency services to their clients. The growing acceptance of cryptocurrencies by established players in the financial world has helped legitimize this asset class in the eyes of many investors.
In addition, there is a growing awareness of the potential benefits of cryptocurrency to individuals around the world, such as decentralization, security, and privacy. Many people are excited about the possibilities that blockchain technology and cryptocurrencies can offer, such as enabling faster and cheaper cross-border transactions and enabling access to financial services for the unbanked.
Finally, the pandemic has also played a role in increasing interest in cryptocurrencies, as many people are looking for alternative investment opportunities in the face of economic uncertainty. While the volatility of cryptocurrency prices may be a cause for concern for some investors, the ongoing enthusiasm for this asset class shows that it will continue to play an essential role in the global financial landscape.
2022 Tests the Resilience of the Crypto Space
The United States is one of the top trending geographies in the crypto space. This is evident in a recent survey by Paxos shared with BeInCrypto. The main objective of the survey was to understand how the fallout of 2022 affected US-based crypto owners. Indeed, it was a volatile and potentially faith-testing year for the ecosystem.
Here respondents lived in the United States, were over the age of 18, and had a cumulative household income in excess of $50,000. Also, the candidates purchased crypto in the last three years. In total, the survey recruited 5,000 participants.
Crypto enthusiasm in America
Surprisingly or not, consumers remained unaffected in their optimism regarding crypto investing. The cohort represented 75% of those surveyed by the firm – “confident or somewhat confident” in the future of the crypto space.
Nearly one-third of the candidates surveyed bought their first cryptocurrency last year despite black-swan events. Meanwhile, 72% of respondents were “not at all or a little worried” about the volatility in crypto markets over the past year.
Overall, the fact that a majority of respondents expressed confidence in the future of cryptocurrency suggests that many people see potential value in this emerging technology. However, it is necessary to continue monitoring the development and adoption of cryptocurrencies to better understand its long-term prospects.
To understand and record more user opinions, BeInCrypto created a short survey on Reddit, asking about the reasons behind their crypto enthusiasm. Several Redditors expressed their opinion on the platform. For example, one of the answers reads:
“I am quite convinced. Volatility is just part of the market, but I have seen beyond it. Interest is growing and we are seeing major mainstream companies adopting blockchain technology. Innovative initiatives from Polygon, Ocean, Algorand, etc. The solutions are further driving adoption, opening up opportunities for web2 companies to join web3.
Another user echoed, or rather echoed, the role of crypto as a payment gateway. The Redditor said, ‘I am quite confident in the future of crypto mainly because I can see adoption growing exponentially as we now have more opportunity to pay for goods and services with crypto through payment platforms. Is.’
rely on middlemen
The next part of the report may surprise many readers. 89% of respondents still rely on intermediaries such as “banks, crypto exchanges and/or mobile payment apps” to hold their crypto.
“Indeed, despite high-profile collapses and inherent poor risk management practices at many crypto companies, crypto owners still rely on intermediaries to hold crypto on their behalf.”
Furthermore, more than 70% of candidates said they were ‘likely or very likely’ to buy crypto from their primary bank if offered. This accounted for a 12% increase from last year’s survey results. Furthermore, more than 40% of respondents are encouraged to invest more in crypto if integrated by banks and other financial institutions.
Needless to say, these institutions have an untapped opportunity if exposed to the full potential of cryptocurrencies. That is, opening a portal to offer digital asset custody without any restrictions.
Ups and downs of centralized institutions
Centralized custodians are third-party entities that hold and manage digital assets on behalf of their customers. They are responsible for ensuring the security of assets and protecting them from theft, loss or other risks. In the cryptocurrency industry, centralized custodians are important in providing a secure and reliable way for institutional investors and other large entities to hold and manage their digital assets.
However, the reliance on centralized custodians has also been debated and criticized within the cryptocurrency community. Some argue that relying on third-party custodians goes against the decentralized and trustless nature of cryptocurrencies. This introduces a single point of failure and requires users to rely on the custodian’s security measures.
The collapse of FTX, or any other centralized custodian, eroded the credibility and trust of such institutions in the eyes of investors and the wider public. However, it is important to note that not all patrons are created equal. Many reputable custodians have strong security measures in place and track records of reliability.
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