UK Consumers and Cryptocurrency 2023
£ 2,195 (Excl.Tax)
Description
Despite market uncertainty and high profile failures, cryptocurrency is very much alive. Mintel’s crypto market research report will help you understand a changing market, and identify opportunities for future growth during challenging times. Read on to read some key insights from our full report.
Topics Covered in this Report
- Advertising and marketing activity of cryptocurrency providers.
- Regulatory landscape of cryptocurrency.
- Consumer ownership and usage.
- Cryptocurrency exchanges and intent to buy.
- Consumer knowledge of cryptocurrency.
- Attitudes towards cryptocurrency.
UK Consumers and Cryptocurrency – Current Landscape
Given the high-risk nature of the cryptocurrency market, many people are approaching cryptocurrency during the ongoing cost-of-living crisis. However, interest in cryptocurrencies persists, despite the economic situation, the potential for thanks to younger consumers’ enthusiasm and a strong intent to buy.
- 15% of Brits say they intend to buy cryptocurrency in the next year.
- 20% of UK consumers have viewed content by cryptocurrency influencers on social media in the last year, rising to 50% of 16-24 year olds.
Cryptocurrency Consumer Trends
Despite cryptocurrency’s popularity, there is a lack of consumer knowledge which is by far the leading barrier to consumers engaging with it. Almost two thirds of consumers who have never owned cryptocurrency cite a lack of understanding as the main reason for not investing. Cryptocurrency exchanges must be proactive in boosting consumer understanding, particularly with such a young core audience.
Regulation for the cryptocurrency industry will be vital in boosting consumer trust, and ultimately will be a huge opportunity to attract people beyond speculative investment. Over half of people think that regulation would make crypto investments more secure. With the current levels of uncertainty in the market, clear regulation will benefit consumers and exchanges alike and help cryptocurrency to fulfil its potential.
Purchase our full UK Consumers and Cryptocurrency Market Report 2023 to discover lucrative innovation opportunities to help your business grow during times of financial uncertainty.
Expert Insights from a Finance Industry Analyst
This report, written by Adrian Reynolds, a leading financial services analyst, delivers in-depth commentary and analysis to highlight current trends in the UK crypto market and add expert context to the numbers.
There is added caution around cryptocurrency following the high profile collapse of FTX in 2022 and a major market crash. Legal disputes involving leading cryptocurrency exchanges in the US is adding to market uncertainty. Despite this, ownership remains high and intent to buy is strong amongst younger consumers. Long term, regulation will be vital if cryptocurrency is to move beyond a speculative investment and towards a viable payment method.
Adrian Reynolds
Principal Analyst, Financial Services
Table of Contents
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Overview
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- Key issues covered in this Report
- Definitions
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Executive Summary
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- The market
- Caution has risen following the 2022 collapse of Terra Luna and the FTX exchange
- Figure 1: Bitcoin price, 2016-23
- Consumer awareness of cryptocurrency exchanges remains low
- Figure 2: Awareness of FinTech brands, 2023
- Cryptocurrency remains unregulated but the FCA has introduced new rules on advertising
- Companies and brands
- Above-the-line advertising declines as brands look to social media campaigns
- Figure 3: Above-the-line, online display and direct mail advertising expenditure on cryptocurrency, 2018-23
- The consumer
- Cryptocurrency ownership is high compared with traditional investing
- Figure 4: Cryptocurrency ownership, 2023
- Cryptocurrency remains a speculative tool with few using it for payments
- Figure 5: Use of cryptocurrency, 2023
- Coinbase leads the way amongst UK cryptocurrency customers
- Figure 6: Use of cryptocurrency exchanges, 2023
- Young consumers will make up the majority of new buyers
- Figure 7: Intention to buy cryptocurrency, 2023
- Expand educational courses and boost awareness to engage new customers
- Figure 8: Barriers to cryptocurrency, 2023
- Knowledge of Bitcoin is limited despite widespread media coverage
- Figure 9: Knowledge of cryptocurrency, 2023
- YouTube and TikTok adverts are raising awareness of cryptocurrency
- Figure 10: Awareness of cryptocurrency advertising, 2023
- Cryptocurrency social media influencers are vital in gaining younger people’s attention
- Figure 11: Attitudes towards cryptocurrency, 2023
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Issues and Insights
- Cryptocurrency is very much alive despite market uncertainty and high profile failures
- Cryptocurrency brands must help bridge the knowledge gap
- Traditional investment brands can learn from cryptocurrency capturing the imagination of young consumers
- Cryptocurrency is very much alive despite market uncertainty and high profile failures
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Market Background
- Cryptocurrency background
- Bitcoin remains the leading cryptocurrency
- Figure 12: Bitcoin price, 2016-23
- The vast number of cryptocurrencies leads to consumer confusion
- Successful meme coins highlight the confusion over valid projects
- Figure 13: The 10 most valuable cryptocurrencies, by market capitalisation, 2023
- Caution has risen following the 2022 collapse of Terra Luna and the FTX exchange
- Popular currency Terra Luna collapsed in April 2022
- Cryptocurrency exchange FTX suffered a high profile collapse in November 2022
- Cryptocurrency background
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Market Drivers
- Continued high inflation could add caution to new investments
- Figure 14: CPI, 2020-23
- Declining financial confidence will limit cryptocurrency growth this year
- Figure 15: Financial confidence for the year ahead, 2021-23
- Consumer awareness of cryptocurrency exchanges remains low
- Figure 16: Awareness of FinTech brands, 2023
- Long-term cryptocurrency adoption will require sustainability improvements
- Figure 17: Perceptions of organisations’ impact on the environment, 2022
- Metaverse could drive cryptocurrency use but interest is limited
- Figure 18: Interest in using the metaverse, 2022
- Continued high inflation could add caution to new investments
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Regulatory and Legislative Changes
- Cryptocurrency remains unregulated but the FCA has introduced new rules on advertising
- The FCA’s Consumer Duty could have implications for cryptocurrency
- UK looks set to embrace Web3 and blockchain technology
- Coinbase open to further regulation and UK expansion
- Binance fined in Netherlands and warned in the UK
- FTX had been warned by the FCA prior to collapse
- Uncertainty grows as US government clamps down on cryptocurrency exchanges
- Cryptocurrency remains unregulated but the FCA has introduced new rules on advertising
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Competitive Strategies and Launch Activity
- NatWest moves to limit cryptocurrency exchange transfers
- Binance halts deposits and withdrawals in pounds
- Revolut continues to expand cryptocurrency platform
- ‘Learn and earn’ scheme looks to boost consumer knowledge
- Koinly partnership highlights the tax implications of cryptocurrency
- Revolut introduces cryptocurrency ‘collections’
- Ethereum 2.0 can offer a more energy-efficient cryptocurrency
- Coinbase announces updates to its premium service ahead of UK launch…
- … and adds safety features to Coinbase Wallet
- Binance launches NFT loan feature
- Open AI CEO raises $115 million for Worldcoin
- London cafe becomes the first to offer cryptocurrency payments
- Block set to launch Bitkey to enhance cryptocurrency storage security
- Cryptocurrency wallet Zumo launches card payments
- Bitcoin payments dealt a blow as Bottlepay closes down
- NatWest moves to limit cryptocurrency exchange transfers
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Advertising and Marketing Activity
- Above-the-line advertising declines as brands look to social media campaigns
- Figure 19: Above-the-line, online display and direct mail advertising expenditure on cryptocurrency, 2018-23
- Crypto.com is the biggest above-the-line advertiser since 2021
- Figure 20: Above-the-line, online display and direct mail advertising expenditure on cryptocurrency, by top 5 advertisers, 2020-22
- Super Bowl 2023 sees a shift away from cryptocurrency
- Football sponsorship has played a key role in cryptocurrency advertising
- Nielsen Ad Intel coverage
- Above-the-line advertising declines as brands look to social media campaigns
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Cryptocurrency Ownership
- Cryptocurrency ownership is high compared with traditional investing
- Figure 21: Cryptocurrency ownership, 2023
- Target younger investors through banking apps
- Figure 22: Cryptocurrency ownership, by age and gender, 2023
- Cryptocurrency remains a speculative tool with few using it for payments
- Figure 23: Use of cryptocurrency, 2023
- Cryptocurrency ownership is high compared with traditional investing
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Cryptocurrency Exchanges and Intent to Buy
- Coinbase leads the way amongst UK cryptocurrency customers
- Figure 24: Use of cryptocurrency exchanges, 2023
- Cryptocurrency purchasing is here to stay
- Young consumers will make up the majority of new buyers
- Figure 25: Intention to buy cryptocurrency, 2023
- Coinbase leads the way amongst UK cryptocurrency customers
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Barriers to Cryptocurrency
- Expand educational courses and boost awareness to engage new customers
- Highlight additional security options to alleviate exchange concerns
- Figure 26: Barriers to cryptocurrency, 2023
- Regulation will be vital for mainstream adoption and payments
- Regulation can also help consumers avoid scams
- Cryptocurrency is unlikely to attract older demographics without regulation
- Figure 27: Barriers to cryptocurrency, by age, 2023
- Price volatility puts off older consumers
- Concerns over the environmental impact could grow
- Expand educational courses and boost awareness to engage new customers
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Consumer Knowledge of Cryptocurrency
- Knowledge of Bitcoin is limited despite widespread media coverage
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- Figure 28: Knowledge of cryptocurrency, 2023
- Greater transparency needed on exchange locations
- Cryptocurrency providers must provide guidance on tax
- Knowledge of Bitcoin is limited despite widespread media coverage
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Cryptocurrency Advertising and Influencers
- Social media dominates cryptocurrency advertising
- Figure 29: Awareness of cryptocurrency advertising, NET, 2023
- Three quarters of 16-24s have noticed cryptocurrency adverts
- Figure 30: Awareness of cryptocurrency advertising, NET, by age, 2023
- YouTube adverts are raising awareness of cryptocurrency
- Figure 31: Awareness of cryptocurrency advertising, 2023
- Cryptocurrency social media influencers are vital in gaining younger people’s attention
- Figure 32: Attitudes towards cryptocurrency influencers, by age, 2023
- Utilise the popularity of TikTok to reach younger consumers
- Figure 33: Awareness of cryptocurrency advertising, 16-24 year olds, 2023
- Social media dominates cryptocurrency advertising
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Attitudes towards Cryptocurrency
- Most cryptocurrency owners are vulnerable to exchange security
- High-profile collapses of 2022 have dented confidence
- Figure 34: Attitudes of cryptocurrency owners, 2023
- Existing cryptocurrencies are preferable to a British virtual currency
- Figure 35: Attitudes towards cryptocurrency, 2023
- Strong appetite to learn more about cryptocurrency amongst younger Brits
- Figure 36: Consumers and Cryptocurrency – CHAID – Tree output, April 2023
- Young Brits believe in cryptocurrency payments but price stability will be key
- Figure 37: Attitudes towards cryptocurrency payments, by age, 2023
- Most cryptocurrency owners are vulnerable to exchange security
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Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
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CHAID analysis – Methodology
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- Figure 38: Consumers and Cryptocurrency – CHAID – Table output, 2023
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