Do You Even Crypto, Bro? Cryptocurrencies in Household Finance

Michael Weber, Bernardo Candia, Olivier Coibion and Yuriy Gorodnichenko

No 31284, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Using repeated large-scale surveys of U.S. households, we study the cryptocurrency investment decisions and motives of households relative to other financial assets. Cryptocurrency holders tend to be young, white, male and more libertarian relative to non-crypto holders. They expect much higher rates of returns for crypto and perceive it as relatively safer than do other households. They also view it as a better hedge against inflation. For those holding cryptocurrencies, changes in Bitcoin prices translate into their purchases of durable goods. Finally, exogenously-provided information about historical returns of cryptocurrencies leads individuals to increase their desired crypto holdings and makes them more likely to actually purchase cryptocurrency subsequently. We compare these views and behaviors to those of households toward other financial assets and argue that cryptocurrency is unique in many of these respects.

JEL-codes: D8 E4 G5 (search for similar items in EconPapers)
Date: 2023-05
New Economics Papers: this item is included in nep-ban, nep-fdg, nep-mfd and nep-pay
Note: AP EFG ME
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Citations: View citations in EconPapers (3)

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Working Paper: Do You Even Crypto, Bro? Cryptocurrencies in Household Finance (2023)
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