Receive all Cointelegraph news immediately in Telegram.
According to LendEDU, a student and personal loan research firm, more than 18 percent of Bitcoin investors have used borrowed money to trade the cryptocurrency.
According to LendEDU, a personal loan research firm, more than 18 percent of Bitcoin investors have used borrowed money to trade the cryptocurrency. In a global survey of 672 active Bitcoin investors, researchers asked traders the method they used to fund their cryptocurrency trading accounts. The majority of investors used banking systems such as credit cards and ACH transfers to fund their accounts.
But 22 percent of traders revealed that they have not paid off their credit and debit cards after purchasing Bitcoin, effectively investing in the cryptocurrency with borrowed money. The report read:
“The wisest and most frugal way to fund a virtual currency exchange account would be through an ACH transfer, which is completely free of charge. Only 18.60 percent of our 672 Bitcoin-invested respondents were paying for the cryptocurrency in this fashion.However, this was not even the most pressing concern coming from the LendEDU poll. That recognition belongs to this data-point: 22.13 percent of Bitcoin investors did not pay off their credit card balance after purchasing Bitcoin.”
“The wisest and most frugal way to fund a virtual currency exchange account would be through an ACH transfer, which is completely free of charge. Only 18.60 percent of our 672 Bitcoin-invested respondents were paying for the cryptocurrency in this fashion.
However, this was not even the most pressing concern coming from the LendEDU poll. That recognition belongs to this data-point: 22.13 percent of Bitcoin investors did not pay off their credit card balance after purchasing Bitcoin.”
Lately, Binance, the world’s largest cryptocurrency exchange, revealed that it has been adding more than 250,000 active users on a daily basis, and were forced to stop adding new users temporarily as a result. Coinbase and Bitstamp have also been adding more than 100,000 users per day and at the time of reporting, Coinbase has close to 20 mln users.
In early December, Bitstamp Co-founder and CEO Nejc Kodrič stated:
“Please understand that we currently have over 100,000 new accounts opened daily. It is challenging to cope with such surge. We are expanding our capacity to onboard clients faster, but this takes a bit of time.”
Hence, 618 Bitcoin users, is nowhere sufficient to create generalizations about the entire global Bitcoin and cryptocurrency market.
But, it is important to acknowledge that a small portion of Bitcoin investors are still trading the cryptocurrency with debt to this date, despite the advice of experts and analysts to refrain from doing so.
In June, Bitcoin and security expert Andreas Antonopoulos strongly emphasized that he only invests an amount in cryptocurrencies that he is willing to lose, given the significant risk involved in cryptocurrency trading. While the risk of investing in Bitcoin is lower than others given the size of its market, the risk for other cryptocurrencies in the global market still remains substantially high.
“I own a few different crypto assets as part of a small but diversified portfolio. I only risk as much as I'm willing to lose,” said Antonopoulos.
In a presentation at Coinscrum, an event hosted by the Imperial College London, Antonopoulos also noted that he can lose all of his investments in cryptocurrencies and still have everything else because he has invested his career, intellectual capacity, and work in Bitcoin and the cryptocurrency market.
For casual investors and newcomers, it is extremely risky to obtain debt to invest in a particular asset and this is not exclusive to Bitcoin. It does not matter which asset it is, becoming in debt to invest in a particular asset or asset class is highly risky.
"My small savings that I do have are invested in Bitcoin. 100 percent [of it]. I actually have a tiny debt in US dollars that I'm still trying to pay off, so it is more than 100 percent in Bitcoin. Now, I'd like to emphasize again, that is not a recommendation to invest. Because I haven't invested my money in Bitcoin, I invested my career, my intellectual capacity, my creativity energy, my passion, and my work in Bitcoin. The money is the least of the investment that I have made in Bitcoin and I could lose everything of it and I'd still have everything else,” Antonopoulos explained.
Follow us on Facebook
For updates and exclusive offers, enter your e-mail below.
Thank you for contacting us! We will reply to you as soon as possible.
Thank you for your interest in our franchise program.
We are considering your request and will contact you in due course. If you have any further queries, please contact: