Despite high-profile stories of Bitcoin megahauls, and one in five Brits investing, just 5% of UK-based Bitcoin investors have profited from the cryptocurrency.
Bitcoin has been gaining increasing prominence as a potential investment, but as the cryptocurrency reaches its 10th birthday, few British investors have seen the benefits. This is according to a national representative survey of over 2,000 people commissioned by IW Capital.
The survey found that while around 13.5 million people in the UK – 20% of the population – have invested in Bitcoin, 11.5 million have failed to turn a profit. Furthermore, 2.5 million have casually invested in the cryptocurrency without fully understanding their investment.
Significantly, just 5% of UK Bitcoin investors took financial advice before taking the plunge.
“With so much advertising and airtime dedicated to cryptocurrencies, particularly over the past 12 months, it is shocking, but not surprising, to see so much confusion around the topic of cryptocurrency,” said Luke Davis, founder and CEO of IW Capital.
“To see that investments have been made without the proper financial advice and a lack of facts is very concerning. With so many high-profile celebrities and business people coming out and supporting cryptocurrency investments, I believe that we will continue to see confusion and a lack of information surrounding them.”
Confusion and concerns deter Bitcoin investors
Many Brits remain either sceptical or confused about Bitcoin, despite its prevalence in advertising and beyond.
According to the survey, 20 million people in UK – around 38% of the overall population – have no understanding of Bitcoin at all.
Furthermore, a third of Brits, 17.5 million, believe the cryptocurrency bubble will burst.
However, 27% see cryptocurrency investments as less stable than investing in small and medium-sized enterprises (SMEs). And for those looking to invest while capitalising on tax relief, this may be a better choice.
“There is a place for cryptocurrency investment, but there are so many other investment opportunities that are not taken advantage of,” said Davis.
“My major concern within cryptocurrency investment is the lack of transparency in the investment. There are so many great SME-based investments that have superb tax incentives to build a portfolio upon, but they are undersold against the allure of Bitcoin and other cryptocurrencies as a viable investment for the first-time investor.”