The United States of Crypto
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In the past year, crypto has continued to grow by awareness and enthusiasm in the US, as more people view the technology as a compelling new way to participate in the financial system. In the latest Coinbase Report, we outline findings on the growing interest in cryptocurrencies on the part of Americans, on a state-by-state level.
Key Findings From Coinbase Research
Currently, 58 percent of Americans say they’ve heard of Bitcoin.
Over the past year, more people searched on Google for Bitcoin than the “royal wedding” or “election results.”
To date, more than 70 percent of US States have enacted legislation that addresses cryptocurrency or blockchain.
Crypto is becoming an increasingly important aspect of local economies. The top 10 US States for percentage of the population that owns crypto are: California, New Jersey, Washington, New York, Colorado, Utah, Florida, Alaska, Nevada, and Massachusetts.
If you want to get a sense of how interested America is in a topic, there aren’t many better benchmarks than Kim Kardashian, whose social-media dominance gives her an outsized slice of our collective consciousness. Since the beginning of this year, one of the rare ideas that grabbed even more of our attention is Bitcoin. On average, Google users have searched for Bitcoin more often than they sought out info on Kim K., and that number is only trending upwards. In late June — as prices climbed — Google searches for Bitcoin surged to almost three times higher than searches for Kardashian. And it’s not just the reality TV star. Americans typed ‘Bitcoin’ into Google more times last year than they searched for a range of headline-making phrases, from “royal wedding” to “election results.”
Americans typed ‘Bitcoin’ into Google more times last year than they searched for a range of headline-making phrases, from “royal wedding” to “election results.”
In other words, Bitcoin is going mainstream in America—even though Bitcoin is just a decade old (its birthday was in January), it has captured the imagination and attention of Americans all over. Today, Coinbase is sharing a report on awareness and adoption trends related to crypto in America, such as which US States have the highest rates of participation and where enthusiasm is highest. This study includes original research conducted by YouGov for Coinbase in December 2018 as well as research data derived from macro-level Coinbase user activity, which is reported in anonymized and aggregate form only.
We also look into the increasing number of states where legislatures have enacted proactive regulations around cryptocurrency and blockchain as a response to local demand and interest in the technology. Finally, we spoke to a range of current Coinbase customers — regular people of varying ages, careers, and locations across the country — to learn the who, where, and why around interest in crypto.
When given a list of cryptocurrencies to choose from, Coinbase research shows that 58 percent of Americans have heard of Bitcoin. People express a range of reasons for their participation, from a desire to add diversity to their investment portfolios to a deeply felt belief in the transformative potential of a secure and decentralized currency.
“The most appealing thing about crypto and Bitcoin to me is the idea of a worldwide currency — that it can cross borders without having to factor in exchange rates or high transfer fees or long delays,” says Christopher, a 26-year-old small business owner in New Jersey. “Say I want to move to another country someday? My cryptocurrency would automatically come with me. My whole journey is not a get-rich idea. I just really believe in crypto and want the technology to succeed.”
Crypto, from state to state
Across the country, 37 percent of Americans — without being prompted with a list of options — proactively name Bitcoin in response to a query about cryptocurrencies.
But that number goes up substantially in certain states. In Wisconsin and Utah, 57 percent of people have unaided awareness of Bitcoin, with Colorado, Massachusetts, and Wyoming close behind. And even the fact that there are still places where awareness is low feels like an opportunity to some people currently involved in crypto. “Cryptocurrency is right alongside artificial intelligence and nanotechnology as cutting-edge tech that has the potential to transform the way we live,” says Todd, a 49-year-old IT supervisor in Northern Virginia. “And lots of regular people still have barely heard of it.”
The top five states with the highest percentage of crypto-owning population are California, New Jersey, Washington, New York, and Colorado, according to Coinbase research. (Interestingly enough, Alaska ranks 8th on the list for highest percentage of crypto-owners, but it also comes in lowest in unaided brand awareness for Bitcoin, at 18 percent.)
Several of the top states for crypto-owners (California, New York, and Washington) also have the biggest per-capita holdings — that is to say, they have a large number of people who not only own crypto, but also have larger holdings. Interestingly, there’s yet another category, which includes states with a lower overall percentage of crypto holders, but a higher per-capita ownership — that is, a smaller number of people who each hold a larger than average chunk of cryptocurrency. The states with the most of those people, adjusted for population, are Delaware, Nevada, and Wyoming.
What’s driving demand
For some people, the investment opportunity presented by cryptocurrency is a major driver of their interest. “For people in my generation, I think it makes a lot more sense than stocks, bonds, inflated real estate, or other depreciating assets,” says Harrison, a 30-year-old systems manager in Washington State. “I have no plans to trade or sell right now — there are price points where I might sell some, to pay off debt or pay off my condo. But the goal is to try to get actual economic freedom.” Similarly, Todd notes that crypto opens up a new form of access to investments. “A lot of the best alternative investment opportunities—not correlated to the stock market—are only available to accredited investors, which is a tiny part of the American population,” he says. “Cryptocurrency is available to everyone.”
Others are participating in crypto as a way of educating themselves. Brenda is a 30-year-old CPA who lives in Puerto Rico. She started practicing recently and notes that her field provides little training around crypto, and so she purchased some in an effort to understand it for her clients. “I need to be able to explain this new technology, and the best way for me to understand it was to try it myself,” she says.”
A look at legislation
As interest increases, states are increasingly enacting legislation to address crypto and blockchain. As of June 2019, more than 70 percent of U.S. States have enacted regulations that account for cryptocurrency or blockchain technology. In April, Ohio announced it would accept tax payments in Bitcoin. “We’re trying to do our small part to … think creatively about how technology can make taxpayers’ lives easier,” said Josh Mandel, former Ohio State Treasurer and supporter of the effort, in an interview with NPR’s Marketplace. (Overstock.com, for one, took advantage of the opportunity, using Bitcoin to pay around $35,000 in taxes.)
“We’re trying to do our small part to … think creatively about how technology can make taxpayers’ lives easier”
Earlier this year, Wyoming passed a set of thirteen laws that, among other things, recognize crypto as money and allow banks to “provide custodial services for digital assets.” With these regulations, the mountain state hopes to become the legal home to banks that could offer asset management and other crypto services to customers nationwide. And since 2015, New York State’s financial regulatory agency has awarded eighteen of what it calls BitLicenses to virtual currency companies that want to broker Wall Street-style trades or other deals on clients’ behalf.
How interested are Americans in buying crypto? According to Coinbase research, upwards of 15% of Americans are “somewhat” or “very” likely to buy Bitcoin or some other cryptocurrency in the near future. The number gets even higher with big-league investors: the asset-management giant Fidelity Investments announced in May that 22 percent of its institutional investors already own digital assets, that almost half would consider adding crypto to their portfolios.
As for the growth in awareness, that seems poised to continue; YouTube searches for Bitcoin reached their all-time high this year. New Jersey customer Christopher explains how he pulled clips from YouTube to create a Powerpoint presentation that he used to explain Bitcoin to his baby-boomer father. “I grabbed some video, grabbed some pictures, and broke it down in a way that he could understand,” he says. “Now he also has his own personal crypto, and whenever his coins go up, he’ll send me a screenshot. It’s something we really bond over.”
Sources and methodology: All data referenced comes either from public sources, from research data derived from Coinbase user activity, which is reported in anonymized and aggregate form only, and from research conducted on behalf of Coinbase by YouGov. The YouGov study was conducted in December 2018 and included 2,000 U.S. internet users over the age of 18 in the general population.