39% of US Investors Buying More Crypto Amid Market Volatility

thebalancemoney.com:

Market volatility is causing 39% of investors to buy more cryptocurrency, a new survey from The Balance has found, as Americans change their investing and savings habits amid a withering economic outlook.

Crypto buyers are bucking the trend to flee for safe havens during times of market volatility; the price of bitcoin has fallen more than 50% since the beginning of the year. Bitcoin, and other cryptocurrencies are generally high-risk, highly volatile assets.

Meanwhile, 41% of investors say they are investing more in stocks in response to today’s market, perhaps motivated by the ability to “buy the dip.” Another 34% say they are making no changes to their investment contributions. 

The Balance surveyed investors between June 30 and July 9, when markets rose just over 2%. 

On the flip side, just over a quarter of the investors surveyed said they are investing less. Nearly 15% said they are pulling back on investing because they have less money, while 9% pointed to inflation concerns. Another 9% told The Balance that they wanted to have more cash on hand as risks of a recession loom. 

Since the beginning of the year, markets have tumbled more than 14%, even slipping into what’s known as “bear market territory” in June. Investors have been jittery as inflation continues to run near 41-year highs, putting increased pressure on the Federal Reserve to raise interest rates to bring inflation down. 

While investors don’t like high levels of inflation, they don’t love rate hikes either; it makes borrowing money more expensive which can slow down business growth. It also increases the likelihood of a recession, which no one wants.

But just because investors are buying more assets, it doesn’t mean they are keeping the same