Half a Million People in Toronto Hold Crypto and Don’t Know the Risks
On June 28, 2018, the Ontario Securities Commission (OSC) has revealed that while there are roughly 500,000 residents of the Canadian province who hold crypto, there exist serious information gaps among them regarding essential crypto markets investment determinants such as transparency, volatility, valuation, and liquidity.
The information came from a survey launched by the OSC called “Taking Caution: Financial Consumers and the Crypto asset Sector” with the intention of seeking out critical insights into Ontario crypto investment culture. The results reveal many interesting statistics. Approximately, five percent of Ontarians have some cryptocurrency holdings, which comes to about half a million people in Canada’s most populated province. Further, a very significant proportion do not seem to appreciate the risks associated with holdings and investing in digital assets.
For example, a part of the survey tests the respondents’ existing knowledge about ICOs and the frameworks surrounding them, so as not to potentially fall victim to scams or regulatory action. It reads as follows:
“When asked who they believe regulates ICOs, half of past and present crypto asset owners responded either that they don’t know who regulates ICOs or that they believe ICOs are not subject to regulation.”
This impression is, of course, wrong as the report pointed out, along with several incorrect ideas and opinions about bitcoin and other cryptos. The hope is that the data gathered will give the OSC a clearer picture of where it needs to step up its public education and sensitization efforts so that Ontarians do not fall victim to crypto market scams and lousy faith schemes.
Tyler Fleming, Director of the OSC Investor Office, described it as a first-time capture of a sector still finding its feet. Fleming said:
“As a regulator, the reason we wanted to do this study is there are a number of investor protection concerns with this emerging crypto asset sector — concerns around volatility, transparency, valuation, liquidity, et cetera. We wanted to get some baseline data. We want to certainly remind investors and market participants that, with respect to ICOs, they are subject to securities regulation. And before investing in any security, it is important that people understand what they’re investing in, what protections are available and who they might turn to in the case of a problem.”
More Interesting Insights
In the report, it is revealed that there is a reasonably strong crypto investment community in Ontario, with possibly as many as 50,000 Ontarians having possessed crypto holdings worth more than $10,000. Perhaps as expected, the study also found a broader acceptance for crypto investing among young men aged 18-34, who are the most dominant group in crypto.
OSC Investor Data
According to the report, one of the most significant risks facing crypto investors in Ontario is the prevalence of ICOs, which raised over $5.6 billion in 2017 alone.
Overall, Fleming said that Ontario crypto holders need to get a more precise grip on their investment to avoid being cheated and to help in explaining the concept of cryptocurrency to ordinary people. Ontario’s continued march toward a peaceful blockchain future certainly does not hurt his mission.
In his words:
“Understanding is lower than we’d like. Only five percent of people said they would feel comfortable explaining the details of crypto assets to somebody else.”