Crypto Adoption Slows Amid Volatility

Regulators have promoted cryptocurrency as an asset class for everyday investors, but new research suggests it's not gaining traction. According to a report from the Urban Institute, only about 9% of Americans currently own crypto, down from 17% who had ever owned it at some point.

The decline in ownership is particularly notable given the efforts by President Donald Trump and others to make digital currencies more accessible. In 2024, federal regulators allowed everyday investors to buy and sell spot Bitcoin ETFs, and Trump's Labor Department proposed a rule easing legal barriers for adding crypto to retirement plans.

Despite these developments, most people view cryptocurrency as a specialized asset class and are deterred by its volatility. 'People still view it as a more specialized asset class,' said Amy Arnott, a portfolio strategist at Morningstar. 'And I think that volatility and these periodic huge declines are still probably keeping people away.'

The Urban Institute's findings align with previous research from the Federal Reserve, which tracked crypto adoption in its survey of Economic Well-Being of U.S. Households. The report suggests that federal regulators should require banks, exchanges, and other crypto providers to provide clear, standardized disclosures about the potential risks of crypto.