A new study from the University of Georgia (UGA) has found that social media users are more likely to invest in cryptocurrencies.
Influence of Social Media on Crypto Investments
The UGA study found that approximately half of the surveyed social media users had invested in crypto, compared to just 10% of those who do not use social networks. Active users of YouTube, Reddit, X, and Clubhouse showed higher rates of investment. Professor Lu Fan stated: “A lot of people talk about cryptocurrency on social media, and it has become a popular topic. People are thinking, ‘Because my friends, family, and the celebrities I admire all invest in that, maybe I should too.’”
Growth of Investments and Risk Awareness
UGA's findings align with those from the National Financial Capability Study, where by 2021, the number of crypto investors rose to 28%. Concerns were raised about misinformation on social media. Young investors, who make up the largest part of the demographic, may overestimate their knowledge and be vulnerable to scams.
Implications for Future Policy
Researchers suggested considering these findings when developing regulatory norms for crypto markets. They also called for more media literacy education to help distinguish reliable investment advice from misleading information.
UGA's study highlights a significant link between active social media usage and the likelihood of investing in cryptocurrencies. The findings may help in shaping more responsible regulatory policies.
