BoC analysts attribute the decline in ownership of bitcoin and other cryptocurrencies to a flawed Canadian regulatory environment that has not been conducive to the development of the crypto industry. And also with falling prices and lower investment expectations amid a general downturn in the digital asset market.
“It is notable that crypto investors have not moved out of bitcoin into other cryptocurrencies, as we have also seen a decline in altcoin ownership,” the study authors said.
The BoC notes that national awareness of BTC and other crypto assets has remained stable since 2018, in the 90 percent range. Meanwhile, respondents with higher levels of financial literacy appear to have left the market, while digital asset owners with low levels of financial literacy have not, according to the study.
The Bank of Canada highlighted several reasons why cryptocurrency owners were selling off their assets. These are the technological and legislative complexities associated with cashing in digital assets. As well as a growing distrust of private crypto assets amid bankruptcies of major market players, losses from hacking attacks and a general drop in prices.
Earlier, the Canadian police department of the municipalities of Richmond and Delta agglomeration of Vancouver reported that large cryptocurrency investors have become more likely to be victims of physical assault and robbery over the past year.