• The average volume and market value of exchange trades will increase by 48%, 118%, and respectively in 2021.
• Largest inflow of new clients coming from the mature wealth accumulators aged 45–59-years (79% YoY) in 2021
• Rise of the ‘Crypto Queens’ – female investors grew much faster than their male counterparts (43pp higher)
• The opportunity for young investors to purchase the dip in market corrections of late 2021 was embraced by them
• As the industry matures, so does the growth of companies, sole traders and SMSFs.

Australia’s cryptocurrency industry continues to evolve rapidly according to BTC Markets (BTCM) Investor Study Report 2021 launched today.

This report provides a detailed analysis of data from the BTCM Exchange for the calendar year 2021. It is divided by demographics (age and gender of investor) in order to anonymly analyse the cryptocurrency investments of 325,000 of its clients.

According to the study, the largest inflow of BTCM’s new clients in 2021 came from Australia’s ‘mature wealth accumulators’ aged 45-to 59-year-olds with a 79 per cent YoY increase.

Caroline Bowler, CEO of BTC Markets, finds this encouraging because this group has a measured risk appetite as they begin to plan for retirement.

“They bring a wealth of experience in traditional investment markets and their decision to invest in crypto is not driven by the fear of missing out (FOMO) but on strategic research and information.”

Due to the higher level of disposable income and the greater ease in leaving crypto on the exchange, the average portfolio size remained the highest among the 60-plus age group.

The BTCM data further showed the continued flattening of gender lines with the ongoing rise of the ‘Crypto Queens’. The platform saw female investors grow at a faster rate than those who invested in males (16% vs. 83%).

Their average initial deposit on the platform was higher in 2021 ($2218 vs. $1978 for men), and their portfolio sizes were closer to those of male investors ($6761, vs. $7028). This is despite the fact that female investors trade less often than males (2 vs. 3 for males).

This is typical female investment behavior in other asset types. Women typically take more time, do more research and invest larger amounts.

“As our platform shows, women have done their research and are now committing to investment – with a long-term, considered view,” she added.

Growth story for cryptocurrency 2021

The average volume and average trade value on the BTCM platform increased by 48% and 12%, respectively. In addition to this, the daily average orders went up by 22%.

It remained the most widely used tokens and was reintroduced as one of the five top-traded cryptocurrencies.

BTCM attributes the growth of cryptocurrency to investors becoming more aware of its utility. Because crypto is decentralised, it has become a popular way to hedge against inflation rising and save low rates.

“Many events in 2021 contributed to making it a watershed year for the cryptocurrency industry in Australia and globally,” Ms Bowler said.

“Around the world, people are using crypto as a means of payment and a fast, efficient way to remit money. As interest rates look set to rise, crypto’s use as a store of value is being demonstrated as a hedge against inflation.

“Closer to home, cryptocurrency is being taken seriously at the highest levels of the Government with a series of legislative reforms to foster the industry and improve investor protection. CBA’s entry into crypto via its banking app paves the way for other mainstream institutions to follow.

“In summary, utility, not speculation is the lifeblood of the crypto ecosystem, and this narrative is now well recognised at investor and government levels,” she added.

Shaken but not stirred: Investors ‘buying the dip’

While market volatility continues to be the number one concern for cryptocurrency investors according to our last report – reactions to this volatility varied across demographics.

BTCM’s report found that young investors (18–24-year-olds) continued to persist in the crypto market with the highest average initial deposit growth in 2021 ($1150 vs $674, 70% YoY), which was even more pronounced in the second half of the year ($1611 vs $882, 83% YoY). Despite the severe market correction that characterized 2021’s second half, it was not surprising.

“Younger investors have clearly not cracked under pressure, and instead embraced this opportunity to buy the dip,” Ms Bowler said.

The growth in average initial deposits fell as we move higher up the age curve. This indicates that older investors approached volatility cautiously.

SMSFs & Companies: In for the long haul

Individual investors are the largest users of the BTCM platform. However, the growth rate for Sole traders (196%), Businesses (79%), and SMSFs (74%) was faster than that of Retail (66%).

A 15% increase was also seen in SMSF investments, with initial deposits now reaching the hundreds of thousands as opposed to previous investments of the tens or thousands. Companies experienced an average increase of 61% in portfolio size.

“This increased commitment from SMSF investors, with their lengthier investment outlook, illustrates a long-term bullish point of view,” Ms Bowler said.

Anecdotally BTCM discovered a pattern that works for account openings. It starts with the individual, and continues to their partners, SMSF, and their company as they become more comfortable.

“Institutional investors and superannuation funds are now in a similar position to where the banks were, and it can only be a matter of time before market developments give them the confidence to embrace crypto,” Ms Bowler concluded.

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