Dutch Cryptocurrency Investors Are On The Rise
There are now an estimated 580,000 Dutch cryptocurrency investors. According to Kantar TNS, a market research and information group, the majority of investments into Netherland’s cryptocurrency market came in last year. Reports also indicate that Dutch investors poured in approximately €900 million into digital currencies. The worth of their investments increased to €4 billion when the crypto-market peaked in December 2017.
Although the market has been reduced to less than half of what it was worth in December, 25% of Dutch crypto investors have still profited from their investments. Per Kantar TNS, “Given the volatility of the currencies, this could improve any second, or get worse”. The research group also states that 66% of Netherland’s crypto-investors are university graduates. Notably, their average age is 38 years, which makes them a lot younger than the nation’s traditional market investors.
The Typical Cryptocurrency Investor
Reg van Steen, Senior Client Director at Kantar TNS, described the country’s new crypto-investors as “bandwagoners”. He added, “Your friends and neighbors do it, so you do too”. When talking about the average crypto-investor, Mr. Steen compared them to the stereotypical traditional investor who is a well-educated and wealthy, older male. In contrast, cryptocurrency investors tend to be younger and even more educated. There’s also a larger percentage of female crypto-investors, according to Mr. Steen.
Usually, Dutch crypto-investors tend to be more conservative with their investments. This is evident from market research, which shows that over three-fourths of investors did not invest more than 1000 euros into digital currencies. Moreover, fewer than 1% invested more than 10,000 euros into the crypto-market. Based on these statistics, cryptocurrencies account for a mere 0.1% of the Dutch citizen’s combined savings.
Warnings from Netherlands’ Central Bank
It seems like Netherland’s crypto-investors have been heeding the warning from their central bank (DNB), considering that they have not been investing more than they can afford to lose. Notably, the bank advised digital currency enthusiasts to exercise extreme caution regarding their virtual investments. It pointed out that there are no safeguards to protect against potentially huge financial losses since the crypto-market is very loosely regulated.
Unlike a number of other central banks around the world, the Bank of Netherlands doesn’t perceive the relatively small crypto-market to be a threat to the global, multi-trillion dollar, traditional financial system. Given the super-volatile nature of cryptocurrencies, the bank does not advocate the use of cryptocurrencies. However, it’s a firm supporter of blockchain technology. In fact, it has been involved in several blockchain-related projects since 2015.
The Netherlands is a peaceful country with the world’s third highest Inequality-adjusted Human Development Index (IHDI). The IHDI serves as a statistical measure of the quality of healthcare, education, and overall living standards (based on income) in a country. It seems that the citizens of Netherlands have invested a substantial amount into the world’s crypto-market. However, since it is far less compared to their total savings, they shouldn’t have to worry about financial instability due to future crashes in the crypto-market.