Crypto Interest Rises Among Non-Owners, But Overall Ownership Declines Despite Bitcoin Surge

A new report from the Federal Reserve Bank of Philadelphia shows that while Bitcoin prices surged in 2024, overall crypto ownership has continued to decline. However, interest from Americans who have never owned cryptocurrency is increasing, with more expressing a desire to enter the market.

Interest in Cryptocurrency Grows as More Non-Owners Express Plans to Enter the Market, Survey Shows

According to a recent report by the Consumer Finance Institute (CFI) of the Federal Reserve Bank of Philadelphia, an increasing number of Americans who do not currently possess cryptocurrency indicate a desire to make future purchases despite overall ownership rates decreasing.

According to the April 2024 Labor, Income, Finances, and Expectations (LIFE) Survey, 13.4% of respondents who had never owned cryptocurrency, commonly known as "no coiners," are now more likely to purchase digital assets in the future.

This indicates a substantial increase from the 6.9% reported in January 2022, representing a rise in potential new market participants.

However, the CFI report also indicated a substantial increase in future purchase intent, particularly among non-owners. In October 2022, only 10.6% of respondents stated they were likely to purchase cryptocurrency. However, the April 2024 LIFE Survey revealed that 21.8% of all respondents had expressed this sentiment.

Despite Bitcoin's 2024 Surge, Crypto Ownership Declines as Interest from Non-Owners Rises

Although Bitcoin (BTC) reached new highs in 2024, overall crypto ownership has steadily declined in the last two years despite the expanding interest among non-coiners. The survey provided a glimpse into the ongoing repercussions of the "crypto winter" of 2022, a period characterized by a significant decline in cryptocurrency values.

The ownership rate was 24.6% in the January 2022 survey conducted just before the downturn. However, the October 2022 results demonstrated a substantial decrease to 19.1% as Bitcoin prices plummeted.

Even though prices increased during this period, ownership levels continued declining as the market stabilized and recuperated. By October 2023, only 17.1% of respondents owned crypto.

Bitcoin prices increased by more than 60% in the first quarter of 2024; however, ownership levels declined again, reaching 15.5% by January. In April, the report indicated a minor recovery to 16.1%. However, by July 2024, ownership had reached its lowest point at 14.7%, despite Bitcoin's proximity to five-year highs.

By the report:

“There’s a clear disconnect between the rising market and declining ownership. While more non-owners are expressing interest in crypto, this hasn’t translated into increased ownership.”

Regulatory Uncertainty and Market Volatility Deter Crypto Purchases Despite Rising Interest Among Non-Owners

The report posits that the rapid price increase has sparked heightened interest, particularly among no coiners, but potential purchasers may be deterred by regulatory uncertainty and market volatility.

Furthermore, the trend may be partially explained by modifications to the survey methodology. The 2022 surveys inquired about crypto ownership within the household, whereas the 2023 and 2024 LIFE Surveys exclusively addressed individual ownership.

The CFI report maintained that the data is comparable across surveys despite the minor methodological differences, suggesting that the ownership decrease indicates broader consumer sentiment.

The report concluded that, although ownership rates are unlikely to rebound in the short term, the market may eventually experience renewed development due to the increasing interest it generates among non-owners. Nevertheless, regulatory developments may significantly influence this as government agencies continue investigating more transparent crypto investment and trading frameworks.

Tom Akana, the author of the report, states:

“The next few years will be critical in determining whether this growing interest from nocoiners will translate into actual participation in the crypto market.”