Seven million Britons own crypto assets as bitcoin surges to $95,000

Seven million adults in Britain now own crypto assets, up from five million in 2022, and growing numbers of them wrongly believe they will qualify for compensation if something goes wrong.
The latest snapshot of crypto ownership from the Financial Conduct Authority shows a sharp increase in numbers owning digital tokens such as bitcoin and ethereum as well as rising numbers borrowing to finance their purchases.
The increase in ownership to about 12 per cent of adults by August from 10 per cent in June last year is also accompanied by a rise in the numbers owning significant amounts by value.
Those owning £1,000 to £10,000 worth have risen from 20 per cent of respondents to 36 per cent. The average holding value is £1,842, up from £1,595 in 2022.
The latest study of a representative sample of UK adults was conducted in August, when bitcoin was trading at about $60,000, well before the election of Donald Trump in America, which has inspired a surge to about $95,000.
People owning crypto tended to be male, younger, from a higher socioeconomic bracket and better paid, the FCA said.
Ignorance about the level of investor protection has worsened. One in five owners of crypto assets now believe they would be eligible for some form of compensation if something went wrong. That is up from one in ten in 2022.
Crypto is largely unregulated and the FCA has repeatedly warned that anyone buying crypto assets should be prepared to lose all their money. The surge in ownership comes in spite of the collapse in late 2022 of FTX, the fraudulent crypto platform.
The FCA said that 18 to 34-year-olds, women and those with crypto holdings of at least £1,000 were statistically more likely to believe they were protected from some form of loss.
It found that while the majority of crypto buyers made their purchases out of ready cash, 14 per cent used a credit card or other form of borrowing, up from 6 per cent in 2022.
Another recent development is the surge in the number of crypto owners taking part in so-called “staking” — temporarily assigning the tokens they own to the blockchain technology that underpins the system in return for rewards.
Crypto fans believe some digital currencies will mature to the point where they become a major part of the mainstream financial system, while detractors argue they are mainly used for transactions by criminals and tax dodgers and are in a greed-fuelled bubble.
Trump has pledged to make the United States “the crypto capital of the planet” and raised expectations of a more favourable regulatory regime.
The seven million people who own crypto compares with an estimated 11.3 million who directly own shares, according to the FCA’s Financial Lives Study of 2022.