Crypto Holders Still in Bear Market Shock, Halted Activities: Fed

The crypto holders are stuck in the bear market. Terra’s market collapse, multi-billion dollar CeFi insolvencies, and rising interest rates are reasons for the fall. On the other hand, 2021, which was a bull market, shows the interest of crypto holders.

The reason can be the strengthening of the economy, a drop in unemployment, and a rise in company profit. The low-interest rate is one of the factors accounting for this.

The downfall seems relevant due to the bear market, but still, when the market is growing a little, people don’t come out of fear. They are holding back their cryptos. The data revealed that the crypto investment is lessened. It is around 8%, which is less than the previous year, which was 11%. Only 2% stated that they use crypto for transactions and payments.

Predictions Made By Analyst Affects Crypto Holders

The predictions made by analysts affect the crypto holders too. The chief technology officer at Tether, Paolo Ardoino, favors the optimistic view towards cryptocurrency bitcoin. He says Bitcoin could retest its all-time high near $69,000 in 2023.

On the other hand, predictions are also made for a Bitcoin crash in 2023. They consider it as a bull trap rather than a bull run. Mark Mobius, the global investor who predicted a huge fall of bitcoin in 2022, also predicted that bitcoin could fall to the $10,000 range.

The Fed data shows that the biggest contribution in crypto is from the age group of 30 to 44 years. Adults of age between 18 to 29 accounting 14%. It is followed by 10% of people aged between 45 to 59 years. Aged 60 years accounts for only 3%.

Fed Analysis Reveals Crypto Bias Towards Younger Users

The Fed analysis shows that crypto adoption is biased towards younger users. It also reveals that men are twice as likely to use crypto as women. In percent form, they account for 14%, while 7% accounts for women.

The participants of the survey reveal that they use cryptocurrency for transactions and speed settlements. They believe in improved privacy with the crypto methodology of payments and transfers.

The other part of the data also shows that the percentage of unbanked users is more than that of banked users. Unbanked users are those who do not hold an account in a bank. They are in a low-income bracket. While banked users are ones with higher income with banking access.

5% of unbanked users use crypto for transactions. While 3% of banked users use crypto for payments and transactions. 4% of respondents reveal that they use crypto for financial transactions and their family income is less than $25,000.