US Investors Reduce Crypto Exposure as Risk Appetite Declines

US investors are showing reduced interest in cryptocurrency, according to a study conducted by the Financial Industry Regulatory Authority, or FINRA. The percentage of U.S. investors maintaining crypto investments remained steady at 27% from 2021 to 2024.

However, the number of investors considering purchasing more or buying for the first time has decreased from 33% in 2021 to 26% in 2024. The study found that the percentage of high-risk investors dropped four percentage points to 8% from 2021 to 2024.

The most significant decline was observed among investors under 35, which fell by nine percentage points to 15%. The study indicates that investment in crypto typically increases during times of high optimism in the broader economy.

However, growing uncertainty regarding interest rates, inflation, and the overall economy has likely prompted investors to gravitate toward safer assets. Notably, 66% of respondents identified crypto as a risky investment, an increase from 58% in 2021.

Despite this perception, one-third of investors believe that taking significant risks is essential to achieving their financial goals, with this sentiment rising to 50% among those aged 35 and under. Additionally, 13% of investors, including nearly one-third of individuals under 25, reported investing in meme stocks and other viral investments.

The pace of new investors entering the market has cooled significantly, with only 8% of investors reporting market entry in the last two years, a stark contrast to 21% in 2021. The surge of younger investors who entered the market during the pandemic has now reversed, returning the share of U.S. adults under 35 who invest to levels seen in 2018.

Overall, the FINRA study reveals a modest trend toward more cautious attitudes and behaviors among investors compared to findings from the 2021 survey.