Crypto craze: 4.8 million Aussies to own cryptocurrency this year
After recent surges in value, Aussies are turning their attention to cryptocurrency, according to a new report by Finder.
A recent survey by Finder of 1,004 respondents has revealed that 25% of Australians either own cryptocurrency or plan to do so by the end of 2021 – equivalent to approximately 4.8 million people.
The survey shows price appreciation is the main drawcard for 45% of those who have purchased cryptocurrencies.
This is followed by 19% who say they want to diversify their portfolio, and 12% who are investing to hedge against inflation.
For 8% of Aussie investors, it was the feeling of FOMO (fear of missing out) that prompted them to invest.
Andrew Munro, Finder's cryptocurrency editor, says that the upward trend towards crypto is likely to continue as Aussies become more savvy with their money.
"Australians took the opportunity to diversify their income during the pandemic, with many now ready to look beyond traditional means for wealth generation.
"The recent cryptocurrency boom attracted a lot of new investors into the space who are excited to add a new stream of income to their wealth portfolio.
"It's particularly encouraging to see younger generations being more engaged with their finances, proving that investing isn't just for hedge fund managers on Wall Street."
Interestingly, the survey found that millennials (44%) are 11 times more likely than baby boomers (4%) to own or plan to own cryptocurrency.
As for what Aussies are buying, the most commonly owned currency is Bitcoin, with 13% saying that they own this, followed by Ethereum at 6%.
A number of lesser known currencies are growing in popularity, with Ripple (5%), Litecoin (4%) and Bitcoin Cash (4%) rounding out the top five.
Munro believes that some of the newer players are likely to become household names in the coming years.
"Five years ago, names like Dogecoin and Ethereum would have held little meaning for those outside the crypto community.
"Now we are seeing these names all over mainstream media, which is likely to make cryptocurrency feel like a more accessible option for budding investors.
"Investing in cryptocurrency has a lot of potential but, as with any investment, that comes with a level of risk.
"Doing the proper research is key to minimising that risk and staying on top of your money."
Tips for getting started investing in cryptocurrency:
- Compare crypto exchanges. A crypto exchange is where you can buy and sell your cryptocurrency. Finder compares over 50 exchanges to help you find the most suitable platform for your needs.
- Create an account. Once you have chosen your exchange, you will need to create an account to begin trading. To do this, you may be asked for information such as your email or photo identification.
- Make a deposit. Now that your account is set up, you can begin depositing money into your account. Crypto exchanges will accept a wide variety of payment methods including bank transfer, PayID, POLi and credit cards.
- Purchase your currency. You are now able to exchange your funds for cryptocurrency. This process will vary depending on your exchange, but you will need to decide how much you want to buy and finalise the purchase.