Crypto in the UK – they know very little and are likely to be left behind

How many people really know what a cryptocurrency is? Those of us on the inside might realize that we are a minority, but just how much of a minority would be interesting to know. Professionals in the finance industry are also interested so they occasionally do studies and research. Recently the Financial Conduct Authority (FCA) of the UK published their latest research to examine the population’s crypto status, so to speak and found some curious data.

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The FCA is a private firm in the UK that regulates 85 000 financial services firms and financial markets there, while also acting as the prudential regulator for over 18 000 of them. This includes banks, building societies, credit unions, insurers and major investment firms. They are the financial security service keeping everyone in the industry safe. It’s a sizeable industry employing over 2.2 million people in the UK, who contribute GBP 65.6 billion in tax. The FCA is the watchdog ensuring their markets work well, remain competitive and maintain confidence in the UK as a major global financial hub. So they would obviously be very curious about crypto of course.

To begin with these guys are the watchdogs for Her Majesty’s Treasury and the Bank of England – the most conservative old school, old money, central banking elite in the world, with a history of feudalism, slavery, imperialism and overall abuse of the planet via their exploitation of conquered colonies for centuries. So they might be the very opposite of our revolutionary new “distributed ledger technology” as they call it.

They use the term “crypto assets” because they don’t see all crypto as currency. They define them on their website as “cryptographically secured digital representations of value or contractual rights that use some type of distributed ledger technology (DLT) and can be transferred, stored or traded electronically.” Furthermore they divide crypto into three types:

• Exchange tokens ( like Bitcoin and Litecoin), that are not distributed by banks and fall outside their regulatory parameter.
• Security tokens, (they don’t name any examples) that provide rights such as ownership, repayment or entitlement to a share in future profits, and as securities fall under FCA regulation.
• Utility tokens which can be redeemed for access to a specific product or service and are outside FCA regulation.

The first study they did was conducted by a research firm called Revealing reality, who interviewed 31 “cryptoasset consumers”, asking them about their motivations and sources of information regarding crypto. Secondly they hired a company called Kantar TNS to survey 2132 UK consumers, asking them high level questions about their awareness, understanding and purchasing habits relating to crypto.

Their primary discovery was that many investors in crypto see it as a way to quick returns or “easy wealth” as they put it. Also many cited being influenced by social media in their decision to invest. Many also overestimated their knowledge and didn’t initially realize that you don’t have to buy a whole coin, but can buy a fraction of one at a time.

On their website the FCA uses dismissive language when referring to crypto like saying “consumers seemed to have a sense that they were investing in tangible assets, due to the language and imagery associated with cryptoassets, such as ‘mining’ and ‘coin’.” As insiders we understand the crypto is as tangible as a fiat paper note, which in itself has no intrinsic value other than what the agreed consensus attributes to it.

Crypto and fiat are therefore identical in their tangibility, though the banks and mainstream financial industry obviously may not see it as such.

The research further concluded that investors engaged in “risky behaviour” in the sense that they didn’t do enough research before investing, only listening to a few influential recommendations. Curiously, they note that those interviewed showed distrust in the mainstream media or official sources of information. Contrastingly, genuine crypto promoters online are constantly telling their audience to do their own due diligence, to do your own research and not just listen to them.

To conclude the overall statistics revealed that very few UK consumers know about crypto, with only 3% by their estimates having actually ever bought any. Furthermore, the FCA reports that only one in four consumers actually know what a cryptocurrency is. And the term is most recognised by males aged between 20-44 years old particularly from the middle class and upper middle class, or AB social grade, as they label it. And out of those, half of them spend under GBP200 and none of them on borrowed money.

Furthermore of those interviewed who have never invested in crypto, only 1 out of 100 are planning to do so in the future. This shows us just how unknown and little trusted the cryptocurrency market is, particularly in the UK, which is probably quite a conservative country by comparison to the rest of the first world.

What does this say about mainstream adoption in the long run?

It tells us that those who are stuck in the old school and don’t move with the times are going to get left behind, which is fine since it was the same old conservative economists and bankers who have profited from mass exploitation for the past few hundred years.

Their time should definitely be ending as soon as possible.