Crypto’s massive marketing efforts have drawn few new investors

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In the past year, crypto firms such as FTX, Coinbase, and Crypto.com have spent tens of millions of dollars to attract new customers. “Fortune favors the brave,” Matt Damon famously said in a Crypto.com TV spot as he tried to get Americans to open their digital wallets.

Now there’s an investigation into how successful they were, and experts say it’s eye-opening: not successful at all. According to the study, led by Pew Research Center, the number of people who have invested in crypto has not increased since September last year before the push began.

The results, released Tuesday, build on an initial investigation in September. At the time, Pew researchers asked 10,371 Americans if they “have ever invested in, traded, or used a cryptocurrency.” About 16 percent of Americans said they did.

Last month, the nonprofit asked another sample — slightly smaller, with 6,034 Americans — the same question. And again, 16 percent said they had invested or traded in the alternative currency.

The results suggest that, despite countless splashy campaigns by crypto interests, the vast majority of Americans remain immune to their sales pitch.

“It’s quite striking that despite all the spectacular crypto commotion over the past year, the number of people investing or trading in crypto has not declined,” said Lee Rainie, director of internet and technology research at Pew Research Center, who spearheaded the study. the study. “Efforts to bring new buyers to market didn’t seem to move the needle at all.”

In late 2021 and early 2022, there was a wave of recruiting efforts as crypto firms tried to engage retail investors. The long-term health of the market is largely dependent on new players willing to sign up for exchanges and buy digital coins.

Just weeks after Damon’s commercial debuted in October, Crypto.com announced a naming deal for the Staples Center in Los Angeles. By February, the push was in full effect. Three trading platforms – Crypto.com, FTX and Coinbase – each bought Super Bowl airtime that reportedly cost $6.5 million per 30 seconds.

The ads targeted a wide swath of Americans — FTX, for example, encouraged the game’s roughly 100 million viewers not to “be like Larry,” referring to the place’s techno-skeptical star Larry David, and instead to invest in crypto.

The results of the study validate crypto skeptics’ criticisms that currencies lack inherent value and rely too much on attracting new investors to enrich the old ones.

“That the cryptocurrency space, despite a ton of ads, is running out of new suckers isn’t all that surprising to me,” said Nicholas Weaver, a computer security expert at the University of California at Berkeley, who often revisits both a financial and ethical issue. -investment. “Although a sucker is born every minute, that’s still a limited pool of suckers.”

The Pew study notes that “this lack of overall change is in the news despite strong focus on crypto.”

Not all analysts embraced Pew’s findings, however. “I doubt the research,” said Edward Moya, senior market analyst at crypto trading and research firm Oanda. “What I’ve seen over the past year is a very diverse group of people — lawyers, nurses, doctors, professors — showing extreme interest in crypto, especially at the start of 2022, when many of them first bought.”

Crypto enthusiasts say that studies crypto investors can be underrepresented because not everyone wants to tell an asker that they have invested and because studies don’t look for the pockets of those most likely to invest. Rainie said Pew has taken rigorous steps to achieve proportionate representation of different racial, gender and economic groups.

Market leaders warn that new pools of investors could be even harder to find in the coming months. During an earnings call this month, publicly traded crypto exchange Coinbase, which ended 2021 with 11.4 million monthly active users, said it expected to end the year with between 7 million and 9 million monthly active users.

Moya said that even if retail investors pull out in the wake of the recent crash, crypto markets could be fueled by institutional investors, who are likely buy after a crash.

The Pew study also examined demographics and found that it hadn’t changed much in the past year either. As in September, adults over 50 were only about a quarter as likely to invest in crypto as adults under 30, while men were 2.5 times more likely than women to invest in crypto.

The study also found that all marketing campaigns did not do much to raise general crypto awareness. Last September, the percentage of those who said they had heard “nothing at all” about cryptocurrency was 14 percent. By this summer, after all the media attention, the ranks of the crypto ignorant had shrunk by just one percentage point to 13 percent.

The Valley Voice
The Valley Voicehttp://thevalleyvoice.org
Christopher Brito is a social media producer and trending writer for The Valley Voice, with a focus on sports and stories related to race and culture.

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