The richest country in Europe is switching to cryptocurrency. This is stated in the KuCoin report, which shared flattering statistics about the future of cryptocurrency in Germany.
Notably, 44% of Germans are “motivated to invest in cryptocurrencies to be part of the ‘future of finance’”; while over a third, “37% of German cryptocurrency investors have been trading cryptocurrencies for over a year.”
Cointelegraph has previously celebrated an impressive and productive year for cryptocurrency in Germany, but it is vital to check the attitude towards crypto on the ground.
Johnny Liu, CEO of KuCoin — the company that published the report — explained to Cointelegraph the state of affairs of German cryptocurrency investors:
“Cryptocurrencies are very popular among the proponents of the accumulation strategy, especially among the younger generation. They prefer to save for retirement on their own and diversify their savings through the use of cryptocurrencies.”
Liu warns that “despite the high demand for cryptocurrencies among Germans, the country does not yet have specific rules that unequivocally regulate the use of digital money.”
Indeed, while Germany was the first country to “recognize that bitcoins are ‘units of value’ and can be classified as a ‘financial instrument’,” the report says. So far, the local regulator has simply made “some progress in regulating cryptocurrencies.”
However, Germany was the first country in the world to adopt a blockchain strategy and, interestingly, Germany’s political stance towards cryptocurrencies became a topic of discussion during the recent parliamentary elections.
According to Florian Dönert-Breuer, Managing Director of F5 Crypto, “Germany is a role model for other EU countries whose populations tend to be more open to long-term investment.” In addition, “as the largest country in the EU with a notoriously risk-averse attitude towards financial assets, Germany has a special role to play.” He adds:
The large number of women interested in cryptocurrencies is particularly encouraging, as this target group is on average less active in the financial market (e.g. the stock market).”
The report states that “69% of crypto investors are men, while women account for 53% of those interested in crypto,” which Dönert-Breuer says shows that women are more interested in the future of finance than in traditional finance.
Katarina Gera, CEO and co-founder of Immutable Insight, also draws attention to the changing demographics of cryptocurrency investors: “Younger demographics show a more self-reliant and equity-focused investing style and tend to be significantly more aware of the risks of inflation.”
However, the future remains uncertain, especially regarding the regulatory framework, as “BaFin never tires of warning about risks.” BaFin is the German Federal Financial Supervisory Authority responsible for regulating cryptocurrencies. They recently gave the green light to neobank N26 to launch cryptocurrency trading in 2022.
Related: City of Lugano to accept Bitcoin, Tether and LVGA tokens as ‘de facto’ legal tender
Dönert-Breuer is “confident that Germany will continue to implement crypto-friendly legislation,” while BaFin’s recent actions, such as approving storage licenses and Bitcoin-based security tokens, are promising signs. Germany may not have the same level playing field as “compared to Switzerland and the UK,” Gera says, “but there is some movement in the legislative arena.”
Last word for Lyu:
“Last year, Germany took the first official step towards accepting investments in cryptocurrencies by approving special funds for investing in digital assets. I think the country has a good foundation in place to create a favorable climate for cryptocurrency users.”