Study Shows: More Speculation, Less Crypto Spending
In 2008, the Bitcoin white paper proposed a radical shift in money with its idea of an open digital cash system.
According to the FCA, there’s been a significant drop in people buying cryptocurrencies to use for transactions, plummeting from 19% in 2021 to a mere 10% in 2022. Meanwhile, the trend toward speculative buying has remained steadfast.
Reports from the Times shed light on attempts to use Bitcoin at London retailers, showcasing a disillusioning reality. Despite initial promises, many shops have retracted their crypto payment options due to low customer uptake.
Technical glitches also plague crypto transactions, including issues like drained device batteries, incompatible wallet apps, and connectivity problems during payments. These hindrances often push store staff to suggest conventional card payments instead.
Given these adoption barriers and deficient infrastructure, it’s evident that the primary driver behind digital asset investment is speculation.
The FCA survey emphasizes this, indicating that the top reason for buying cryptocurrency, in both 2021 and 2022, was seen as a high-stakes “gamble,” rising from 38% to 40%, respectively. This reaffirms the speculative nature of crypto investments.
Similarly, research from the Journal of International Financial Markets, Institutions, and Money in 2018 echoes these sentiments, noting that most Bitcoin transactions were linked to speculative investment rather than practical use.
Despite its initial promise as a form of “electronic cash,” Bitcoin’s predominant utilization seems to lean heavily towards speculation, owing to the inefficiencies of existing payment systems.