Almost every cryptocurrency is having a hard time right now. The total value of the entire asset class is hovering just above 1 trillion and now almost everything has fallen by 50% or more. Even confidence in some stablecoins is already shaky. Still, people are not done with the phenomenon yet. This is according to a survey by Bank of America.
Huge percentage positive about crypto
That explained meart analyst Jason Kupferberg from Bank of America in an interview with CNBC. About 1,000 American adults took part in the survey early this month. So it was after the crash of Terra (LUNA), but before the difficulties of the past few days started.
It is noteworthy that as many as 91% of the participants say they will put some amount in crypto in the next six months. The same percentage has also invested in crypto in the past six months. Furthermore, 40% say cryptocurrencies to use for online payments† This can also be done automatically via, for example, some credit cards, emphasizes the analyst. 77% of participants invest for the short term and have held tokens in their portfolio for less than a year.
Kupfenberg also emphasizes that it is not surprising that cryptocurrencies are falling sharply, despite theoretically protecting against high inflation. They are (currently) correlated to risk assets.
Reverse psychology
You can see this news as very positive. It means that there is still a need to keep putting money in the asset class. Michael Saylor would say ‘every time I have some money left I buy crypto.’ That doesn’t just apply to Saylor. Almost all investors feel this way, if the sample is reliable.
You could also see that as a problem. If we are indeed in a bear market and not in a small dip as part of an uptrend, then the road down is still a long one. At the bottom of a bear market, people are generally extremely pessimistic.