Europeans are more cautious of cryptocurrency compared to those in emerging markets, and the primary cause of this appears to be the high volatility of digital assets. In light of this, Luno, a London-based cryptocurrency company conducted a research about how people from different regions view and use virtual currencies.
The Luno Survey was conducted across seven territories where 500 individuals with prior knowledge about cryptocurrency were consulted.
The survey shows that 47% of Europeans are not sure that cryptocurrencies are safe and profitable. But in emerging markets like Nigeria, South Africa and South East Asia, the reverse is the case. In fact people in these places tend to favour digital currencies more like Bitcoin and Ethereum. About 79% affirmed their belief in the profitability of cryptocurrencies.
In response to these fears, a number of stablecoins, which have ties to fiat money, have been launched. Examples of such fiat pegged stablecoins are Tether (USDT), USDC and the recently launched JP Morgan’s JPM Coin.
Government Regulation Expected To Ease Fear
About a third of those who partook in the survey in Europe and emerging markets admitted that their fears would have been calmed had the government taken measures to oversee the cryptocurrency market, which has led to more requests to the government to regulate cryptocurrency.
The survey revealed that the primary reason people purchase cryptocurrency is for investment purposes. About 82% of emerging markets participants and 58% of Europeans say it’s better than receiving payments and making online retail payments.
This proves that cryptocurrencies still needs to put in more work before they can be chosen to replace cash. Only 21% of Europeans have admitted to receiving payment in cryptocurrency.
Digital Asset Volatility Hinders Adoption
Crypto volatility was responsible for the $20,000 surge in Bitcoin’s value in 2017 before it all came crashing down to around $3,000 in 2018
Sometimes, even before a transaction goes through, the value of cryptocurrency can change significantly within that space of time, but thankfully such issues are being eradicated by faster blockchain technologies.
Going by the numbers, emerging markets have shown to be more open to the use of cryptocurrency as 29% confirmed receiving payments in cryptocurrency.
Christian Zeiler, GM Europe from Luno said:
“It’s really interesting to see that even in times of uncertainty in the crypto market, consumers that don’t own any cryptocurrency are looking to get involved in the crypto space.”
“I still think there is a long way to go to get these consumers to buy cryptocurrency but we are leading the way in educating the general public in the benefits of cryptocurrencies and through our educational programmes and talks we hope that we can show the consumers that think cryptocurrencies are complicated that this is not the case and get them more involved in this evolving technology.”