BTC Markets’ Investor Study Report FY23–24 found that while a resurgence in investment has traditionally been driven by retail investors – consistent with the historical view of cryptocurrency as a “people’s movement” – a notable shift is occurring.
According to the Australian Taxation Office, SMSFs held approximately $1 billion in cryptocurrency assets in March 2024, a substantial increase from $198 million in 2019 and representing a 400 per cent growth over five years.
“This trend highlights the rising interest in digital assets among Australian investors and positions cryptocurrency as one of the fastest-growing asset classes within SMSF portfolios,” the report said.
“SMSFs and trusts are increasingly adopting cryptocurrencies for its diversification benefits, potential high returns, tax advantages, and as a possible hedge against inflation.”
BTC’s report also found that while non-retail investors were fewer in number over the past year, there was a dramatic 189 per cent increase in their average initial deposits.
“This shift highlights the growing influence of more sophisticated investors in the crypto market,” the report said.
The top three cryptocurrencies favoured by non-retail investors have remained largely consistent, with slight shifts among BTC, ETH, and XRP. This stability underscores the ongoing confidence non-retail investors have in these well-established digital assets.
The report continued that there is a growing role for crypto in retirement portfolios, stating that a decade ago, cryptocurrencies were relatively unknown and deemed unsuitable for retirement portfolios.
“Today, the landscape has transformed dramatically. Over the past 14 years, gold has yielded a return of 97 per cent in US dollar terms, and the S&P 500 has returned 380 per cent as of 8 August 2024,” it said.
“However, bitcoin’s extraordinary growth of 84 million per cent since 2010 far surpasses these figures, drawing significant attention from SMSFs and fund managers. The rebound in interest from SMSFs, sole traders, and trusts reflects growing confidence among strategic and long-term investors.”
Furthermore, the substantial year-on-year growth in their holdings highlights a shift towards using digital assets in long-term financial strategies rather than as speculative trading instruments.
The report continued that crypto trading remains predominantly active among younger demographics, particularly those aged 25-44 years, which shows the highest frequency of trades on the BTC Markets platform.
“Despite this, older investors (60+) have consistently demonstrated a greater capacity for larger initial investments and maintain the largest portfolio sizes,” the report said.
“This trend is attributable to their greater financial stability and accumulated wealth over time. However, in FY23–24, the 25-44 age group surpassed the 60-plus cohort in initial deposits, suggesting that older investors who are transitioning to retirement may be adopting a more cautious approach due to market volatility and the evolving ETF landscape, while younger investors are showing greater confidence and risk tolerance.”
