Despite the risks that come with storing crypto assets with third parties, the findings of a new study suggest many cryptocurrency holders still trust exchanges with the safekeeping of their funds. Conducted by Binance Research, the study finds that 60% of â€œthe general population store their cryptocurrencies on an exchange.â€� In contrast, 26% of the respondents use cold wallets and only 11% are using hot wallets.
Security of Funds Remain a Key User Concern
Dubbed the 2021 Global Crypto User Index, the studyâ€™s findings â€œare based on a global survey issued to over 61,000 crypto users across 178 countries and regions.â€� The study survey, which ran from September 15 to October 25, 2020, explored questions surrounding the respondentsâ€™ demographics. Researchers also sought to understand the crypto holdersâ€™ attitudes, preferences, adoption, and motivations â€¨towards cryptocurrency investment.
Meanwhile, the study findings show that despite the high percentage of the respondents who prefer storing funds with an exchange, security of the same assets remains a key. As the findings show, 28% of respondents prioritize an exchangeâ€™s â€œreputation of being secureâ€� when choosing the best platform to buy cryptocurrencies.
The concern receiving the next highest consideration is the â€œintuitive user experience and user interface.â€� On the other hand, only 3% of the respondents prioritize an exchangeâ€™s reputation for being compliant with regulations.
Crypto as a Source of Income
In terms of the number of users that derive their income from cryptocurrencies, the study findings show that 51% of respondents said yes. From this figure, about 15% say cryptos are a primary source of their income while for the remaining 36% these constitute a secondary income. Still, the findings show that 48% of the respondents still consider crypto a hobby.
Meanwhile, the other key findings of the study include the popularity of decentralized finance (Defi) in South East Asia where 52% said they use Dapps. Overall, 66% of all Dapps users are using Defi applications.
The findings also suggest that a majority of users have less confidence in stablecoins with 78% saying they â€œwould rather use bank coins instead of stablecoins.â€�â€¨Furthermore, findings suggest â€œadoption is primarily driven by the expected future utility for crypto assets.â€�
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