Crypto lending firms have been under increased government scrutiny after the collapse of FTX, one of the world's largest crypto exchanges, led to a downward spiral in the crypto market and hurt investors' confidence. Since then, the Securities and Exchange Commission has levied fines and other penalties against crypto lending firms.
Despite regulatory concerns and a downturn in the market, cryptocurrency remains a popular investment. But do the average individual holders of crypto know what they're doing? A report by Cardify finds that 33.5% of buyers have little knowledge about crypto. Meantime, LendingTree finds 38% of investors lost money when they sold.
"People can be misled into thinking their knowledge of finance translates really well to their knowledge of crypto," says Michael Jones, Ph.D., an assistant professor of economics and director of the Cryptoeconomics Lab at the University of Cincinnati.
Jones, along with colleague Binny Samuel, Ph.D., and doctoral student Truong "Jack" Luu, developed a scale to better understand an individual’s crypto-economics literacy. The scale measures knowledge in both the technical and economic aspects of cryptocurrency.
On Cincinnati Edition, we'll discuss crypto-economics literacy, the risks of investing, and how to get information if you do want to invest.
Guests:
- Michael Jones, Ph.D., associate professor of economics and director of the Cryptoeconomics Lab, University of Cincinnati
- Truong "Jack" Luu, doctoral student, Cryptoeconomics Lab research fellow, University of Cincinnati
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