By Ketki Saxena
The Bank of Canada (BOC) has reported a decline in Bitcoin and other cryptocurrencies' ownership in Canada in 2022, according to a study released last week. The annual Bitcoin Omnibus Survey (BTCOS), conducted by the central bank, revealed unfavorable market conditions and regulatory challenges as the main reasons behind this trend.
By August 2022, Bitcoin ownership in Canada had dropped to 9%, although it saw a slight increase to 10% by the end of the year. Importantly, the decrease in Bitcoin ownership does not imply that investors diversified into other cryptocurrencies. The BOC study noted a concurrent decrease in the ownership of altcoins.
Investment was the primary motivation for Canadians interested in Bitcoin, with over one-third of the 4,996 respondents in the BOC survey indicating this. Most Canadians acquired their crypto holdings through mobile and web apps, with Bitcoin and crypto mining being the third-most-popular method of acquiring tokens for the second consecutive year.
In terms of altcoin investments, Dogecoin emerged as the most popular among Canadians, likely due to Elon Musk's influence and its history of unpredictable price surges. Other popular altcoins included Ether, Bitcoin Cash, and Litecoin.
The BOC study is seen as crucial for monitoring two conditions that could warrant the issuance of a central bank digital currency (CBDC). These conditions are if Canadians stop using cash almost entirely or if they widely adopt and use private cryptocurrencies for payments.
The central bank attributed ecosystem collapses, regulatory hurdles, and price depreciation as significant factors contributing to the decline in crypto ownership. However, with the government's intent to provide regulatory clarity and a stable market environment, crypto ownership in Canada is expected to recover.