First of its kind survey provides insights
into how crypto investors analyze assets
NEW
YORK, July 11, 2023 /PRNewswire/ -- Despite a
persistent interest in crypto assets, a majority
of investors don't prioritize the metrics experienced
crypto traders tout when assessing the viability and
attractiveness of crypto assets, according to a new
Digital Disclosure Survey from global Fintech leader, Broadridge
Financial Solutions (NYSE: BR).
The Broadridge study, which was conducted in conjunction with
Dr. Chris Brummer, the Agnes
Williams Sesquicentennial Professor of Financial Technology
at Georgetown Law, surveyed 2,000 crypto market
participants in the United States,
UK and Canada and polled
respondents on what performance metrics they look at when making an
investment decision and where they find that information.
The report found that investors and prospective investors of
crypto assets typically prioritize conventional
metrics such as risks factors and security (54%), financial
overview (e.g., cash flows) (52%) and holdings of the management
team (43%) when making decisions. However, critical
crypto-specific metrics such as tokenomics (16%) and
network performance (28%) did not even make it to the top five of
their concerns.
"The survey data reveal that many investors prefer traditional
finance metrics, and emphasize them over other factors that impact
crypto specifically," said Dr. Brummer.
The findings raise questions as to whether investors fully
appreciate the importance of crypto-native factors
that can be essential to understanding crypto assets.
Network performance, for example, can provide a real-time view on
how the platform behind the crypto asset is
performing, how holders are engaging with the platform, as well as
the number of active projects – data any investor needs to know. In
a similar vein, the tokenomics of a coin reflect and can determine
the current and future supply of a particular asset.
Combating the Knowledge Gap
Over 65% of respondents suggested their holdings represented a
long-term investment, suggesting that, contrary to popular
perception, most participants may not be speculators. Additionally,
47% of respondents answered that their investments in the space
were being used to educate themselves, suggesting a "learning by
doing" approach by investors.
"To help better inform and educate investors, metrics that track
crypto asset performance should be standardized,
better disclosed and made more easily accessible, especially for
retail investors needing the most relevant information and support
possible to make informed decisions," said Rob Krugman, Chief Digital Officer, Broadridge.
"For any market to survive and grow, you need trust, and trust
isn't possible without transparency."
Where and when are Investors Finding Crypto
Information?
To further understand how investors and prospective investors
are staying informed and educating themselves on
crypto assets, the survey also asked where respondents
receive their information and their ideal timeframe on receiving
new updates. Respondents indicated they look to a variety of
sources for this information, including the native website of the
crypto provider (39%), a broker (35%), a
crypto exchange (34%) and crypto press
(32%), to name a few.
Given the decentralized nature of
crypto assets, prospective investors are looking
broadly for performance indicators; however, more investors
claiming to have experience with crypto assets
indicated that they tend to look for where the off-chain data is
located, usually either on the asset provider's own website or a
third-party data provider, whereas prospective investors are still
following the traditional finance approach and expect that data to
be within their exchange app or brokerage.
In terms of frequency of information, just under half of all
respondents would prefer to receive updates on at least a quarterly
or monthly basis, with 27% of respondents preferring to receive
updates as information changes. Given the rapid pace of the market,
information needs to be provided to holders not only to ensure they
are receiving timely updates on their holdings, but to also ensure
they have a proper understanding of what that information means and
what updates entail.
"This is the first ever study to survey the disclosure
preferences of crypto holders and investors, and a
project we are proud to have led during this time of intense
regulatory discussion," observed German Soto Sanchez, Head of Corporate Strategy,
Broadridge.
The full results from the Digital Disclosure Study can be found
here.
About Broadridge
Broadridge Financial Solutions (NYSE: BR), a global Fintech
leader with more than $5 billion in
revenues, provides the critical infrastructure that powers
investing, corporate governance and communications to enable better
financial lives. We deliver technology-driven solutions that drive
business transformation for banks, broker-dealers, asset and wealth
managers and public companies.
Broadridge's infrastructure serves as a global communications
hub enabling corporate governance by linking thousands of public
companies and mutual funds to tens of millions of individual and
institutional investors around the world. Our technology and
operations platforms underpin the daily trading of more than U.S.
$9 trillion of equities, fixed income
and other securities globally. A certified Great Place to
Work®, Broadridge is part of the S&P
500® Index, employing over 15,000 associates in 21
countries.
For more information about us and what we can do for you, please
visit https://www.broadridge.com/.
Media Contact
Gregg Rosenberg
Corporate Communications
Gregg.Rosenberg@broadridge.com
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SOURCE Broadridge Financial Solutions, Inc.