Financial literacy in the crypto community at a critically low level
The crypto community struggles with financial literacy
The level of financial literacy among crypto community participants is approximately 25%, according to a study conducted by PiP World. This figure is half the average in the United States and closely resembles levels seen in underdeveloped countries.
As reported by Cointelegraph, while the financial literacy rate in the crypto industry is only 8% lower than the global average, it remains dangerously low.
"The findings of this report highlight an undeniable truth — financial literacy in the crypto space is alarmingly low," stated Saad Naja, CEO of PiP World.
He noted that many traders are "operating blindly" in a rapidly changing market, lacking the fundamental knowledge needed to succeed. Additionally, emotional stress heavily affects crypto community members, who often admit to being "impulsive and neurotic."
As a result, seven out of 10 cryptocurrency investors report losses, while 76% express regret over their investment decisions.
Different investor groups
The study also revealed significant differences in financial literacy levels among various investor groups. Whales — large-scale players making up 5% of the crypto market — demonstrated the highest financial literacy rate at 96%. Hodlers, or long-term investors (11% of participants), had a strong score of 80%.
Speculative traders, the largest group at 29%, showed a financial literacy rate of 64%. On the other hand, day traders (6% of participants) exhibited the lowest literacy rate at 27%. Pump-and-dump participants, representing 18% of the market, displayed a literacy rate of 45%.
Meanwhile, the price of Bitcoin has seen a significant drop, triggering widespread liquidation of long positions.
