After a difficult year for the crypto market, investors in Germany are starting to feel more positive and confident about it. However, some concerns remain.
According to a recent study by KPMG and BTC-ECHO, which surveyed 2,400 private crypto investors in Germany, Austria, and Switzerland, interest in crypto has increased. The study found that 54% of those surveyed invest more than 20% of their total assets in crypto.
Optimism is on the rise again as Bitcoin recently soared to a new high, surpassing $72,000. This uptick is attributed to the successful launch of spot Bitcoin ETFs and the anticipation of the upcoming Bitcoin Halving.
Brad Garlinghouse, the CEO of Ripple, has also forecasted that the cryptocurrency market could exceed a valuation of $5 trillion by the end of this year. According to the KPMG study, about 67% of investors with a strong commitment to digital currencies are planning for the long term, with investment horizons ranging from three to five years.
On the other hand, market newcomers are proceeding with caution. They carefully evaluate investment opportunities with a greater degree of diligence and patience. As a result, service providers need to put in more effort to convert an interested individual into a client.
Concerns about security continue to affect the crypto market in Germany
Just as in 2023, there is still a notable gap between signing up for a cryptocurrency exchange and actually using it. When choosing their preferred platforms for cryptocurrency transactions, investors focus on security measures, deposit and withdrawal options, and transaction fees.
According to the research results, 34% of investors believe their investments in digital assets are “quite secure.” However, concerns such as market manipulation, regulatory uncertainty, and financial crimes are still prominent among investors.
Bitcoin increased its presence in investors’ portfolios by 7% compared to last year, dominating with a 91% share. Ethereum holds the second position, while Solana has seen a significant rise of 9% since last year.
The German government has taken proactive steps to regulate the cryptocurrency sector, aiming to protect investors and ensure the stability of the financial system. In 2019, laws were passed allowing banks to handle and trade in cryptocurrencies, with ongoing discussions about introducing further regulations for cryptocurrency exchanges and initial coin offerings (ICOs).
Undoubtedly, the regulations governing crypto are constantly developing —with agencies like BaFin and the Federal Ministry of Finance responsible for overseeing adherence to compliance and reporting requirements. Strict regulations for Know Your Customer (KYC) and Anti-Money Laundering (AML) are in place to prevent fraudulent activities on cryptocurrency trading platforms.
