Crypto Quill

12% of UK adults now own cryptocurrency, with growing awareness and value held

Crypto ownership in the UK is on the rise, with recent research from the Financial Conduct Authority (FCA) revealing that 12% of UK adults now own cryptocurrencies such as Bitcoin. This is up from 10% in previous surveys, indicating a steady increase in the adoption of digital assets across the country.

Increased Awareness and Higher Investment Values

The survey also shows a rise in awareness about cryptocurrencies, with 93% of respondents familiar with crypto, up from 91% in earlier findings. Moreover, the average value held in crypto investments has increased, with the average holding now valued at £1,842, up from £1,595 in previous reports. These figures suggest that not only are more people owning crypto, but they are also investing larger sums into the market.

The Need for Clearer Regulation

Despite the growing interest and participation in the crypto space, the FCA notes that public understanding of the regulatory landscape remains limited. Approximately a third of crypto owners believe they could raise a complaint with the FCA if something went wrong, assuming they would be entitled to recourse or financial protection. However, this assumption is largely inaccurate, as crypto assets remain largely unregulated in the UK at present.

The FCA is preparing to introduce a more comprehensive regulatory framework for crypto assets, which is expected to be rolled out in the coming months. The regulator has published a roadmap that outlines key dates for the development and introduction of new regulations, including a series of focused consultations to shape the future regulatory landscape.

Matthew Long, Director of Payments and Digital Assets at the FCA, emphasized the need for clear regulation to support a “safe, competitive, and sustainable crypto sector” that fosters innovation while ensuring market integrity and consumer trust. He stated, “Our research results highlight the need for clear regulation that supports a safe, competitive, and sustainable crypto sector in the UK.”

Growing Appeal and Rising Risks

While the FCA’s research highlights the growing appeal of crypto assets to UK investors, legal experts warn of the risks involved. Chris Recker, a legal director at law firm Kingsley Napley, pointed out that while crypto assets are becoming increasingly popular, many people still perceive them as being more regulated than they actually are. This misperception, he says, is concerning, especially as scammers often target crypto investors, leading to significant financial losses.

Paul Waterman, a partner at GSB Wealth, cautioned against including cryptocurrencies in comprehensive financial strategies due to their volatile nature and uncertain value. He noted that, while crypto may serve as a medium of exchange or store of value for some, its long-term stability and worth are still up for debate. Waterman also highlighted the lack of investor protection in the current regulatory environment, which adds additional risks for crypto investors.

FCA’s Role Moving Forward

The FCA is actively working to create a regulatory framework that addresses these concerns while fostering the growth of the crypto sector. As the UK’s crypto ecosystem continues to expand, the need for clear, effective regulation becomes even more critical to protect consumers and ensure the market’s integrity. The forthcoming regulations will likely play a key role in shaping the future of crypto ownership and investment in the UK.