A new report by cryptocurrency exchange Gemini has revealed that one-in-five Australians invested in digital currencies during 2021.
Instead of securing instant riches, many investors found out that investing in cryptocurrencies without doing one’s due diligence could have adverse consequences.
The people to benefit the most were those joining early in 2021 when the bitcoin (BTC) rally was still only getting started.
With the crypto market reaching AU$4.03 trillion at of the peak of the cryptocurrency bonanza, many investors were emboldened to move in on the space, mostly regular Australian consumers.
However, BTC lost much of its value only two months after and dropped by 40%, curbing people’s enthusiasm for instant riches.
While the current BTC value is much higher than any year in the past, it may still be far from what the investors bought it for. Australian investors are estimated to have invested a total of AU$4bn on BTC in 2021 alone.
According to the Independent Reserve Cryptocurrency Index, only six out of ten (or fewer) people managed to eke out a profit from cryptocurrencies in 2021.
The remainder most likely sustained financial losses or in the very least, they saw their investment shrink when it was supposed to go up.
Gemini did not provide much more information about Australian investment habits or when the peak of the investments was.
Meanwhile, the world is carefully eyeing the consequences of the Russian invasion and war in Ukraine, which has sent energy and commodity prices up. This could prove another reason for the quicker adoption of cryptocurrencies.