Although Bitcoin’s price has tumbled mightily from the historic highs it enjoyed last year, many grew wealthy through their early investments. Curious as to how people were spending the hefty returns from their Bitcoin buys, the Bank of Canada conducted a study called the Bitcoin Omnibus Survey (BTCOS) in 2016. Intrigued by the findings, it did it again for 2017 and recently released the results in a report called the “Bitcoin Awareness and Usage in Canada: An Update.”
The bank aimed to understand how the adoption and usage of Bitcoin could impact Canada’s financial system. According to the report, it was also important to assess Bitcoin’s potential effect on how the bank executes its core functions, which include producing and distributing currency.
Spending Bitcoin spoils
When it comes to buying Bitcoin, people give two main reasons for their willingness to take such a risk, saying they invest in the cryptocurrency either for transactional or investment purposes.
Some hold it for as long as they can in anticipation of the price continuing its meteoric rise. Others hold it until they make enough money to cash out and buy whatever their hearts desire.
Canadians seem to be taking a prudent approach when it comes to their Bitcoin spoils. The survey found they are mainly investing their returns rather than spending them, which stands in contrast to the findings of the 2016 survey.
The report states:
“Previously, the 2016 BTCOS found that most Canadians who owned Bitcoin did so for transactional purposes and because of an interest in new technology. However, in 2017 we found that investment was the number one reason. Further, only about half of Bitcoin owners were found to regularly use it to buy goods or services or to send money to other people.”
That’s what friends are for
An interesting find about Canadian Bitcoin buyers relates to how they came to be interested in the first place.
While many purchase the coin for investment purposes, a considerable number own it because their friends do. In 2017, the motivation for 58% of Bitcoin owners was to hold it “as an investment.” The second place went to “My friends own Bitcoin,” which was the reason cited by 12% of the respondents.
The survey also established that greater awareness of Bitcoin was accompanied by a significant increase in ownership - from 2.9% in 2016 to 5% in 2017. However, the difference in ownership rates among the so-called aware respondents was not significant, suggesting that much of the increase was driven by the entrance of newly aware consumers, according to the report.