Young investors plan to pour more of their savings into digital assets this year despite worries about a crypto market crash.
Approximately 56 per cent of investors between the ages of 18 and 34 have plans to increase their holdings in digital assets in 2022 despite many expressing concern about a crypto market crash, according to a survey by trading platform Saxo Markets.
The study found that the main reason young investors invest in digital assets is to secure their financial futures and help them earn additional income, while one in seven respondents plan to invest “for fun.”
“Increased hype on social media and in the news is driving investors to take up high-risk investments, including cryptoassets,” a spokesperson for the FCA told City A.M..
A recent Ipsos Mori survey revealed that social media is the top destination for investors seeking financial advice. While almost a third of respondents said they would take advice from influencers, just 19 per cent said they would trust a broker.
“As unregulated products, people are unlikely to be protected if things go wrong, which is why we repeatedly warn people that if they chose to invest in cryptoassets, they should be prepared to lose all their money,” the FCA spokesperson continued.
The bleak assessment comes as the FCA prepares to turn the screws on advertising for digital assets and other high risk investments. Last week the FCA proposed new rules which would ban crypto assets targeting a mass audience and require promotions to come with risk warnings.
Charles White-Thomson, chief executive of Saxo Markets UK, gave a more positive assessment of the data.
“One year on from the events which saw the rise of the so-called Reddit army of traders, a quieter but more sustainable cohort of younger investors is emerging which will shape the future of investing for years to come,” said White-Thompson.
This week, the world’s largest crypto currency Bitcoin touched lows of $33,500 more than 50 per cent below its November peak of $69k.
Read more: Saxo Bank’s crypto products rake in $2.5bn