US crypto users have not lost faith in “middlemen” to hold their crypto, with a January survey from Paxos suggesting that a majority of US crypto hodlers still trust banks, exchanges and mobile payment apps to hold their assets to preserve.
An annual online survey published March 7 by the stablecoin issuer, conducted between January 5 and January 6, sought to understand how the crypto winter and the 2022 “major industry breakdown” — including FTX and Alameda Research — will impact consumer behavior and confidence in the crypto ecosystem. Paxos noted:
“2022 has been a rollercoaster year for the crypto industry.”
“From some of the highest-ever Bitcoin prices to some of the lowest, large-scale industrial impacts from companies like Terra, FTX, Alameda Research and more – it has been a volatile and potentially confidence-inspiring year for the ecosystem,” it added.
After a turbulent end to 2022, crypto consumers are confident in 2023. We conducted a consumer survey and found many reasons why crypto is still seen as a primary foundation for financial livelihood. Read our full research here: https://t.co/AwFrGMuX0r pic.twitter.com/TZcmct0O5L
— Paxos (@PaxosGlobal) March 7, 2023
However, the survey found that of those who heard and followed the FTX saga, more than half (57%) of respondents planned to buy more crypto or simply do nothing as a result of the news.
It also found that 89% of respondents still relied on “intermediaries” such as “banks, crypto exchanges and/or mobile payment apps” to hold their crypto, stating:
“Despite the high-profile collapses and underlying poor risk management practices seen at several crypto companies, crypto owners still rely on intermediaries to hold crypto on their behalf.”
The survey also found that consumers have a higher desire to be able to buy Bitcoin (BTC), Ether (ETH) and other digital assets from household or traditional banks, with 75% of respondents saying they would be “likely or very likely” to buy crypto. buying their “primary bank” if it were offered, up 12 percentage points from the year before.
“Furthermore, 45% of respondents reported that they would be encouraged to invest more in crypto if there was more widespread adoption by banks and other financial institutions,” added Paxos.
It said there was a “significant untapped opportunity” for banks if they expanded offerings into digital assets. “These services would not only meet the increasing demand, but they would also result in increased engagement,” Paxos claimed.
Related: Paxos is in ‘constructive talks’ with SEC: Report
Respondents were eligible for the survey if they lived in the United States, were over the age of 18, had a total household income of more than $50,000, and purchased cryptocurrency sometime in the past three years. The study recruited 5,000 participants.
“Despite the volatile crypto landscape of 2022, consumers have not lost confidence in their crypto investments. This number was unchanged from last year’s report, underscoring the long-term confidence of those participating in crypto markets,” Paxos wrote.
However, the timing of the study means that the aggregated results did not take into account more recent crypto headwinds, such as the bankruptcy of cryptocurrency lender Genesis, the crackdown on Binance USD (BUSD) involving Paxos, and the financial uncertainty of crypto bank Silvergate Capital.