2021 will likely be remembered as the year that saw cryptocurrency adoption skyrocket in Germany and around the world. According to the index created by the firm ChainAnalysis, cryptocurrency usage increased almost 25-fold between the end of 2019 and the first half of 2021, with a major explosion right at the beginning of this year.
Capterra conducted a study on the use of cryptocurrencies and surveyed 1,644 crypto users from Germany, France, Italy, Spain, the UK, Brazil, Canada and Australia. In this article, we report on the results of the first part of the study and look at the typical German crypto user and their use of cryptocurrencies and wallets . The full methodology of the study can be found at the end of the article.
What are cryptocurrencies?
Let's start with a definition: Cryptocurrencies are virtual means of payment that are equivalent to digital money and are designed to carry out any type of transaction.
They are currencies that exist only in digital form and are usually not linked to a central issuing or regulatory authority, but use a decentralized system to record transactions and manage the issuance of new units. The currencies rely on cryptography to prevent counterfeiting and fraud in transactions.
This form of payment can be exchanged for goods and services online and can be used to pay, store or transfer money directly to another person (peer-to-peer).
Germans invest the least in crypto compared to other countries
16% of survey participants from Germany say they are currently using or have already used cryptocurrencies. Of these, 89% trade the currency themselves, while 11% commissioned a third party to purchase it.
Germany is at the bottom of the list with one sixth of crypto users. The digital currency is more common in our European partner countries. Its use is booming, especially in Spain, but also in Brazil.
The use of cryptocurrencies in a country comparison
In the following, we will take a closer look at the behavior of crypto users in our survey. We will focus mainly on the German participants.
Cryptocurrencies in Germany: The 5 most important insights about crypto users
1. Bitcoin is the most popular digital currency
In recent years, these virtual currencies have experienced a growth boom, culminating in Bitcoin's highest value ever in November of this year . Bitcoin is by far the most popular cryptocurrency among our survey participants, followed by Ethereum.
2. The majority buy cryptocurrencies on exchange platforms
The most popular option for buying and selling cryptocurrencies are crypto exchange italy telegram data platforms such as Binance or Crypto.com. They are preferred by 76% of buyers and offer several benefits to buyers. These include exchanging fiat currencies (such as euros or dollars) for cryptocurrencies, trading, and advice on taxes and regulations.
cryptocurrency platforms
36% tend to use trading platforms. Trading cryptocurrencies means betting on the price movements of one of their currencies. To do this, users receive a "Contract For Difference" (CFD) that allows them to bet on the rise or fall of the assets without actually owning them. At the end of the bet, the user can trade the difference in value established at the time of opening and closing the CFD contract through their platform.
3. 66% use hot wallets
To trade cryptocurrencies, users need a wallet. A crypto wallet works like a traditional wallet, but instead of paper money, it contains proof of the digital currency. It does not physically store digital money, but is used by a trader to verify, buy, or sell their assets. The wallet stores both the public and private keys, which ensure the security of the owner's assets. It also enables the digital signatures required to authorize each transaction.
The most popular crypto wallets are the so-called hot and cold wallets. There are also hardware and paper wallets, but these are less used. What exactly is the difference and how often are the wallets used?