What are the psychological factors that drive cryptocurrency investors compared to traditional investors?
Best insight from top research papers
Cryptocurrency investors are primarily influenced by psychological factors such as cognitive biases, fear of missing out (FoMO), overconfidence, and self-affirmation . Additionally, the psychological antecedents toward cryptocurrency investment decision-making include skepticism, subjective norm, perceived self-efficacy, trust disposition, and risk disposition . Unlike traditional investors, cryptocurrency investors are driven by factors like risk-taking, quick returns, and extreme gains or losses, resembling behaviors seen in gambling and betting activities . Moreover, cryptocurrency investors tend to be educated, young, and digital natives, with differences in ownership across genders emerging in recent years . These findings highlight the significant impact of psychological aspects on cryptocurrency investment decisions compared to traditional investments.
Answers from top 5 papers
More filters
| Papers (5) | Insight |
|---|---|
| Psychological factors influencing cryptocurrency investors include attitude, subjective norm, self-efficacy, trust disposition, and risk disposition, as revealed in the two-country study on cryptocurrency investment decision-making. | |
27 Citations | Cryptocurrency investors are primarily motivated by education, youth, and being digital natives, rather than distrust in traditional finance systems, as shown in the U.S. Survey of Consumer Payment Choice. |
| Psychological factors driving cryptocurrency investors include money anxiety, stress, social interactions, and internal locus of control, influencing investment decisions through cognitive biases like herding, overconfidence, and representativeness. | |
| Psychological factors driving cryptocurrency investors include self-affirmation, postdecision dissonance anticipation, FoMO, overconfidence, and perception of the investment process and regulation, differing from traditional investors. | |
| Cryptocurrency investors are driven by psychological factors like risk-taking, quick returns, and similarities to gambling, unlike traditional investors, who may not exhibit these traits. |
Related Questions
What are the potential psychological factors that drive individuals to invest in cryptocurrencies?5 answersPsychological factors influencing individuals to invest in cryptocurrencies include basic human values like openness-to-change and self-enhancement, investment biases such as self-affirmation, fear of missing out (FoMO), and overconfidence, attitude towards cryptocurrency, subjective norm, perceived self-efficacy, trust disposition, and risk disposition, consumer innovativeness, attitude, perceived behavioral control, subjective norm, and lifestyle orientation, financial literacy, herding behavior, risk perception, and their interplay influencing investment decisions. These factors collectively shape individuals' decisions to engage with cryptocurrencies, highlighting the complex interplay of values, biases, attitudes, and perceptions in the realm of cryptocurrency investment.
What factors contribute to the high volatility of cryptocurrencies and how does this impact investors?5 answersThe high volatility of cryptocurrencies, such as Bitcoin, Ethereum, Binance, and Ripple, can be attributed to various factors. Changes in the investor base, as indicated by fluctuations in subreddit followers, significantly increase idiosyncratic volatility in cryptocurrency markets. Additionally, the risk-return trade-off among cryptocurrencies plays a crucial role in their volatility. For instance, Bitcoin exhibits the highest volatility and risk associated with expected returns, impacting its price dynamics and risk profile. This volatility poses challenges for investors, requiring them to carefully assess the risk-return trade-off. Understanding these dynamics is essential for investors looking to diversify their portfolios and navigate the uncertainties in the cryptocurrency market effectively.
What are the factors affecting the adoption of cryptocurrencies?4 answersFactors affecting the adoption of cryptocurrencies include ease of use, perceived usefulness, social influence, financial literacy, perceived threat, attitude, perceived severity, perceived susceptibility, effort expectancy, performance expectancy, facilitating conditions, consumer innovativeness, subjective norm, and LOHAS lifestyle. These factors influence the willingness to use cryptocurrencies for financial transactions and digital payments, as well as the intention to use cryptocurrencies as a medium of exchange. The level of acceptance and social acceptance of cryptocurrencies also play a role in their adoption. Additionally, factors such as convenience, popularity, credibility, recommendations, and risk management impact consumer adoption of cryptocurrencies. Price stability, however, does not seem to significantly impact consumer adoption. Overall, understanding these factors is crucial for promoting the adoption of cryptocurrencies in various industries and countries.
What are the psychological factors that affect cryptocurrency adoption?4 answersPsychological factors that affect cryptocurrency adoption include basic human values such as openness-to-change and self-enhancement. Consumer innovativeness, attitude, perceived behavioral control, subjective norm, and lifestyle also play a role in cryptocurrency adoption. Overconfidence, self-control, and gender are additional factors that influence cryptocurrency use among early adopters. Investment biases in cryptocurrency are influenced by factors such as self-affirmation, anticipation of postdecision dissonance, fear of missing out (FoMO), overconfidence, perception of the investment process, and regulation. Factors that drive behavioral intention to use cryptocurrency include subjective norm, perceived risk, perceived usefulness, perceived enjoyment, perceived ease of use, trust, and attitude.
What are the factors affecting the adoption of cryptocurrency?5 answersThe factors affecting the adoption of cryptocurrency include the perceived threat of cryptocurrency becoming illegal in the future, national developmental indicators such as education, human development index, and regulatory quality, social influence, transparency, price value, traceability, and attitude, and basic human values such as openness-to-change and self-enhancement. Other factors include subjective norm, perceived risk, perceived usefulness, perceived enjoyment, perceived ease of use, trust, and attitude towards cryptocurrency. These factors influence the intention to use cryptocurrency for digital payments and the level of adoption in different countries and industries.
What causes cryptocurrency?5 answersCryptocurrency is caused by the active development of information technology and the spread of globalization processes, which have led to the emergence of new varieties of digital money. It is a virtual monetary system that operates on cryptographic technology. The popularity of blockchain technology has also contributed to the rapid growth of cryptocurrencies. The emergence of cryptocurrency, such as Bitcoin, in 2009 marked a significant milestone in the transition from an academic concept to a virtual reality. However, for cryptocurrencies to gain widespread acceptance, they need to be widely adopted by consumers and merchants. The issues of legal and economic regulation, as well as the classification and penetration of cryptocurrencies into the economy of states, are also important considerations.