Keywords
household cryptocurrency investing, inflation hedging, income shocks
Abstract
We provide a first look into the drivers of household cryptocurrency investing. Analyzing consumer transaction data for millions of U.S. households, we find that, except for high income early adopters, cryptocurrency investors resemble the general population. These investors span all income levels, with most dollars coming from high-income individuals, similar to equity investors. High past crypto returns and personal income shocks lead to increased cryptocurrency investments. Higher household-level inflation expectations also correlate with greater crypto investments, aligning with hedging motives. For most U.S. households, cryptocurrencies are treated like traditional assets.
Original Publication Citation
Who Invests in Crypto? Wealth, Financial Constraints, and Risk Attitudes (with Darren Aiello, Scott Baker, Tetyana Balyuk, Marco Di Maggio, and Jason Kotter) R&R, Review of Financial Studies
BYU ScholarsArchive Citation
Aiello, Darren; Baker, Scott R.; Balyuk, Tetyana; Maggio, Marco Di; Johnson, Mark J.; and Kotter, Jason, "Who Invests in Crypto? Wealth, Financial Constraints, and Risk Attitudes" (2023). Faculty Publications. 9241.
https://scholarsarchive.byu.edu/facpub/9241
Document Type
Working Paper
Publication Date
2023
Publisher
Review of Financial Studies
Language
English
College
Marriott School of Business
Department
Finance
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