March Of The Cryptocurrencies: One Third of UK Consumers Buy In
Do you know anyone who gets paid in Bitcoin, or buys train tickets from an automated kiosk using cryptocurrencies? If you do, the person getting paid is probably based in Japan (where Partial salary payment in Bitcoin has been an option for years). And digital-currency train ticket purchase has been a feature on Swiss train platforms for years.
But what about the UK? The advance of cryptos is inevitable – as we consistently report in these news pages – but the milestones are less obvious.
Consumer research from Coinbase and Qualtrics has found that a third of UK consumers have previously purchased or still own cryptocurrency.
A significant jump from 29% in October 2021, this Coinbase Pulse survey also revealed that a staggering 64% plan to increase their holdings by buying more, and 23% will diversify into new currencies, as awareness and ownership become par for the course.
Coinbase highlights that while historically a knowledge gap has permeated the investment space, 13% of respondents stated that they had a good understanding of traditional investment assets such as property or stocks and shares. Further, 11% believe they have a good understanding of cryptocurrencies, beyond Bitcoin.
Consumer cryptocurrency ownership levels in the UK are second only to the Netherlands (47%) in Europe; ahead of Spain (26%), Italy (25%), Germany (24%) and France (17%).
Bitcoin (BTC) and Ethereum (ETH) remain the most owned cryptocurrencies at 75% and 52%, respectively, followed by DOGE (34%) and Binance Coin (33%).
A Coinbase spokesperson says: “The UK continues to be a leading European hub of crypto investment with a growing proportion of people engaging with these assets. Recent survey work suggests that the adoption trend may continue, with many sharing ambitions to expand the size and diversification of their portfolios.”
Historical Performance And IFISA Process Guide
- Money&Co. lenders have achieved an average return of more than 8 per cent gross (before we deduct our one per cent fee).
That figure is the result of over £24 million of loans facilitated on the site, as we bring individuals looking for a good return on capital together with carefully vetted small companies seeking funds for growth. Bear in mind that lenders’ capital is at risk. Read warnings on site before committing capital.
- Money&Co. has been lending for over 5 years and has only had two bad debts so far, representing a bad debt rate of 0.03 per cent per annum.
All loans on site are eligible to be held in a Money&Co. Innovative Finance Individual Savings Account (IFISA), up to the annual ISA limit of £20,000. Such loans offer lenders tax-free income. Our offering is an Innovative Finance ISA (IFISA) that can hold the peer-to-peer (P2P) business loans that Money&Co. facilitates. For the purposes of this article, the terms ISA and IFISA are interchangeable.
So here’s our guide to the process:
- Step 1: Register as a lender. Go to the login page, and go through the process that the law requires us to effect. This means we have to do basic checks on you to comply with money-laundering and other security requirements.
- Step 2: Put money into your account. This is best done by electronic transfer. We can also process paper cheques drawn in favour of Denmark Square Limited, the parent company of Money&Co.
- Step 3: Buy loans in the loan market. Once you’ve put cash in your account it will sit there – and it won’t earn interest until you’ve bought a piece of a loan. It’s this final step that requires lenders and IFISA investors to be pro-active. Just choose some loans – all loans on the Money&Co. site can be held in an IFISA – and your money will start earning tax-free interest.
The ISA allowance for 2020/21 is unchanged from last tax year at £20,000, allowing a married couple to put £40,000 into a tax-free environment. Over three years, an investment of this scale in two Money&Co. Innovative Finance ISAs would generate £8,400 of income completely free of tax. We’re assuming a 7 per cent return, net of charges and free of tax here.
Once you have made your initial commitment, you might then consider diversifying – buying a spread of loans. To do this, you can go into the “loans for sale” market. All loans bought in this market also qualify for IFISA tax benefits.
Risk: Security, Access, Yield
Do consider not just the return, but the security and the ease of access to your investment. We write regularly about these three key factors. Here’s one of several earlier articles on security, access and yield.