Since 2020, there has been a steady growth in the number of U.S. institutions entering the crypto market. Whether it’s through their own crypto offering like PayPal, support for crypto payments like Twitter, or adding crypto to their balance sheets like MicroStrategy, the industry has never seen more companies step forward in public support of the industry.
The growth in institutional adoption is highly correlated with the growth in retail adoption. While it’s hard to say which comes first, the two market segments show no sign of stopping when it comes to their appetite for crypto.
This was illustrated in Gemini‘s latest State of Crypto in the U.S. report, which analyzed thousands of U.S. adults to get a better understanding of the retail market.
According to the research, not only have there never been more crypto owners in the U.S., but the country has never seen so many crypto-curious investors.
“We found that the crypto-curious crowd is growing and poised to take action soon. Importantly, this crowd represents a more mainstream audience, and a potential future shift in who we traditionally think of as the typical crypto holder,” Gemini wrote in the report.
The data presented in the report is extremely valuable to all participants of the crypto market, as it enables them to get a better understanding of who their customers and peers are.
Crypto broadens its appeal
Based on the sample size, Gemini estimated that roughly 14% of the U.S. population owns cryptocurrency. This translates to 21.2 million U.S. adults, but the company believes this is a very conservative estimate and the true number could be much higher.
When it comes to cryptocurrency owners, 74% of them are male, 71% are white, and 39% are aged between 25 and 34. Based on other parameters, an average crypto owner is a 38-year-old man making around $110,000 per year. This is in line with most other projections of what makes up the average crypto holder—an above-average level of financial literacy and disposable income.
While some might not find the description of an average crypto holder surprising, the make-up of the crypto-curious audience is somewhat unexpected. Women account for more than half of those interested in getting into crypto soon, representing a major shift from the current male-dominated market.
But it’s not young women that are looking to enter the crypto market—a notable 25% of crypto-curious women are 55 or older. This is a stark difference from current female crypto-owners, only 4% of which are older than 55.
“Women are not only poised to makeup a larger portion of the next wave of crypto buyers, they’re also more likely to be women nearing retirement,” it said in the report.
Aside from gender, location and income are also two major changes we can expect from the next wave of crypto buyers. According to the report, they are likely to have less money than current crypto holders and are more likely to live in a small town or rural area.
“This shift in gender, age, average income, and location indicates that crypto is starting to broaden its appeal away from an investment solely reserved for those with a large amount of assets to one that is more mainstream and accessible for the average person.”
Based on the percentage of respondents indicating that they plan to purchase cryptocurrencies, Gemini estimates that this could mean 19.3 million U.S. adults entering the crypto market in the next 12 months.
The U.S. is seeing an increase in crypto awareness and acceptance
Out of the almost 20 million people that could enter the crypto market in the next year, most will have some knowledge of cryptocurrencies. However, diving deeper into this issue reveals a significant knowledge gap—Bitcoin is almost synonymous with crypto, but few have heard of other cryptocurrencies.
Almost all of the crypto-curious have heard of Bitcoin, while just over a third have heard of Ethereum. Other cryptocurrencies failed to get major traction with the mainstream audience, with just 2% saying they have heard about Cardano and Polkadot. Tether, the largest stablecoin by market capitalization, was recognized by 11% of the crypto-curious respondents.
There are indications that the knowledge gap identified above could be shrinking.
With almost 40% of those who don’t yet own cryptocurrencies considering themselves knowledgeable about crypto, this gap could be closing once they enter the market. Gemini believes that this shows that consumers are attempting to learn about the market before entering, which could result in more thought-out crypto investments.
This is in line with other findings in the report, which found that the large majority of current crypto owners say they buy and hold crypto for its long-term investment potential. More than two-thirds buy and hold, compared to the 36% who actively trade for profit. Looking at the crypto-curious audience reveals a similar split—54% said they wanted to buy and hold crypto as a long-term investment, while 39% said they were interested in active trading.
In the coming year, we can expect a more diverse group of people to enter the market with significantly more knowledge than those that came in as early adopters. The largest cryptocurrencies by market cap are set to be the ones that see the biggest influx of new capital, which won’t be liquidated any time soon.
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