As per a new Bank for International Settlements (BIS) report, cryptocurrency investors are driven by the rising prices of tokens rather than a distrust of banks.
BIS on 15 November published “BIS Working Papers” which looks into the relationship between Bitcoin (BTC) prices, cryptocurrency trading, and retail adoption.
The study reveals that a rise in Bitcoin’s (BTC) price is associated with a significant increase in new users, i.e. entry of new investors; most retail investors downloaded cryptocurrency applications when prices were high.
BTC’s price rise driving crypto adoption
Bitcoin’s price rose from $250 in August 2015 to $69,000 in November 2021. Alongside this, the monthly average number of daily active users (DAU) rose from 119,000 to over 32.5 million.
As we can see, this user base rose the most around the time when BTC’s price hit an all-time high (ATH) of $69,000 in November 2021.
The report further stated, “Users [are] being drawn to Bitcoin by rising prices— rather than a dislike for traditional banks, the search for a store of value or distrust in public institutions.”
Turkey, Singapore, US, and UK leading crypto adoption
The demographic distribution of crypto app adoption was also uncovered in the report.
Both India and China had the lowest adoption rates, with the latter witnessing barely 1,000 cryptocurrency application downloads per 100,000 people. According to the BIS, increased legal restrictions on crypto are stifling retail adoption in those countries.