Who Owns Crypto-Assets?
Some crypto-assets were originally designed, or have been promoted, as tools capable of making payments simpler, faster and less reliant on traditional payment networks. In practice, however, they are used mainly as investment assets and only rarely for purchasing goods and services.
A study published by the European Central Bank sought to understand whether the limited use of crypto-assets for payments is also linked to differences in the characteristics and preferences of those who own them and those who report using them to make payments. The result is a profile of the typical crypto-asset holder.
Who owns crypto-assets
According to the study, people who own crypto-assets are more likely to have an investor profile. On average, they are younger than those who do not own them, financially active, more confident in using digital tools and more likely to hold other financial instruments as well.
Crypto-asset ownership is also more common among individuals who place importance on the speed of card payments and on the privacy associated with cash. The tendency to keep cash as a store of value is likewise associated with a higher probability of owning crypto-assets.
Overall, these characteristics suggest that crypto-assets are held primarily as investment assets, sometimes for speculative purposes, rather than for everyday purchases.
Who says they use them to make payments
The group of people who report using crypto-assets for payments is much smaller and displays partly different characteristics.
These users appear to place particular value on certain features of cash, such as transaction privacy and ease of use. According to the study’s interpretation, they are seeking to replicate in a digital instrument some of the characteristics traditionally associated with cash.
The difference between the two groups helps explain why the number of people who own crypto-assets is far higher than the number of those who actually use them for payments. This gap is therefore not only linked to their limited acceptance by merchants, but also to the different preferences of those who purchase them as financial assets and those who wish to use them as a means of payment.
A reminder: crypto-assets are not legal tender
The fact that some people appreciate in crypto-assets certain features associated with cash does not mean that the two are equivalent.
Crypto-assets differ widely in their characteristics and levels of risk, but they share one fundamental feature: unlike euro banknotes and coins, they are not legal tender.
Even stablecoins, which are designed to maintain a more stable value and to complement money in payments, are not always able to perform fully and consistently all the core functions of money: serving as a means of payment, a store of value and a unit of account.
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