Some 40% of US crypto owners view their digital assets as a hedge against inflation, survey finds

• Among US crypto owners, 40% view their digital assets as an inflation hedge, a Gemini survey has found.
• Inflation in the US is running at 40-year highs, pushing people to seek a way to protect their wealth.

As price rises hit a four-decade high, 40% of cryptocurrency owners in the US say they view their digital assets as a hedge against inflation, a survey has found.

But among all US respondents, including majority who aren't holders, only 16% saw crypto as a great way to protect their wealth from losing value as inflation soars, according to a Gemini report published Monday.

The US is grappling with its highest inflation rate since 1982, driven initially by pandemic pressures and more recently by the impact of Russia's war on Ukraine on energy and food prices in particular. Rising prices erode the value of a US dollar, say, as it takes more of the currency to buy goods and services.

Global cryptocurrency investment hit a turning point in 2021, the Gemini report found, driven by inflation and a push to diversify.

Almost half of US crypto owners — 44% — started buying digital assets in 2021, it said, compared with 41% for all holders worldwide. The highest levels of newbies were in India (54%), and in Brazil and Hong Kong (both 51%).

"The vast majority of crypto owners in the US (85%) buy and hold cryptocurrency for its long-term investment potential or as a 'store of value'," Gemini said in the report.

But in countries whose currency has been devalued against the dollar over the last decade, the appetite for crypto is sharper. People dealing with 50% or more currency devaluation are more than five times as likely to say they plan to buy crypto this year, according to the report.

Gemini said it surveyed almost 30,000 people across 20 countries between November 2021 and February 2022.

Traditionally, investors look to gold and other perceived safe havens such as the Swiss franc to shelter their wealth from the effects of inflation. But many crypto enthusiasts have touted the benefits of digital currencies as an inflation hedge, including Texan congressman Pete Sessions, who recently described bitcoin as digital gold.

—Pete Sessions (@PeteSessions) March 30, 2022

Read more: The founder of a commodities ETF provider managing over $1.5 billion shares his outlook for 8 assets that have experienced major supply chain disruption and elevated prices during the Ukraine crisis