Hong Kong retail interest in virtual assets grows but three out of four people invest for short-term reasons, survey finds

Hong Kong retail investor interest in virtual assets has grown in recent years but three out of every four of them have been investing in the asset class based on short-term considerations, a new survey finds.

Eight per cent of retail investors in the city invested in virtual assets in 2023, up from only 1 per cent in 2019, according to a new study published on Wednesday by the Investor and Financial Education Council (IFEC), a subsidiary of the Securities and Futures Commission (SFC), Hong Kong’s securities regulator.

The study, which was conducted from June to July this year and surveyed 1,000 people aged between 18 and 69, found that all of the virtual asset retail investors held cryptocurrencies but only 6 per cent held non-fungible tokens (NFTs) and 2 per cent held stablecoins.

Interest in virtual assets is expected to grow further, with the intention to invest in virtual assets or related products in the next 12 months standing at 11 per cent, the IFEC says in its report.

Of the retail virtual asset investors surveyed, 75 per cent said that they invest in virtual assets to pursue short term returns. Meanwhile, 74 per cent of them believe that virtual assets are an investment trend and 73 per cent invest in virtual assets because they “worry about missing out on popular investment opportunities”, according to the IFEC, pointing to the need for improved investor education.