While Pakistani authorities announced on May 17 that they are working to have cryptocurrencies banned in the country, a survey conducted by global crypto exchange firm KuCoin found that 33% of Pakistani crypto investors see the instrument as a hedge against the Rupee’s precipitous drop in recent months.
Trading, HODLing, peer-to-peer money transfers, and purchasing Non-Fungible Tokens (NFTs) are the most common use cases for cryptocurrencies in Pakistan, according to KuCoin’s report “Into the Cryptoverse: Understanding Pakistani Crypto Investors 2023”.
According to the findings, 47 percent of Pakistani crypto investors are between the ages of 26 and 39, while 35 percent are under the age of 25.
The survey, which will be conducted from May 5 to May 12, 2023, will be based on a sample of 500 adult crypto users in the country.
17% Engage in Crypto Investment Amidst Rupee Depreciation
Pakistan ranks sixth among all countries in Chainalysis’ 2022 Global Crypto Adoption Index. According to our most recent survey in May 2023, 17% of internet users aged 18-60 in Pakistan identify as crypto investors who currently own or have owned crypto in the previous six months.
As the Pakistani Rupee has depreciated by more than 20% against the US dollar in recent months, this demonstrates a growing public awareness and acceptance of cryptocurrency as a viable investment option.
The profile of crypto investors suggests that males and younger generations (Gen Z and Gen Y) are more represented and involved in crypto investments in Pakistan.
66 percent are male, indicating a gender imbalance in the crypto investment space. Gen Y (aged 26 to 39) is the largest age group of crypto investors (47 percent). Gen Z (ages 18 to 25) is the second-largest group, accounting for 35% of the total.
The majority of crypto investors in Pakistan (66 percent) have an annual household income of less than Rs. 5 million. Furthermore, 30 percent of new investors have started investing in cryptocurrency in the last three months.
This suggests that as crypto adoption grows, a sizable proportion of crypto investors in Pakistan come from middle-to-low-income households.
- In January-March, 30% of investors entered the cryptocurrency market
According to the data, a sizable proportion of respondents across all generations have recently entered the cryptocurrency market, with 30% reporting making their first transaction in less than three months.
Gen Z has the highest percentage (36%) of people who have made their first cryptocurrency transaction in the last three months.
A sizable number of investors have been involved in the cryptocurrency market for an extended period of time. Approximately 36% made their first transaction within the last year.
- Growing Interest in Digital Assets
Overall, the data shows that crypto investments in Pakistan are primarily in the low to moderate ranges. A significant portion (40%) of Pakistani crypto investors have invested less than Rs. 30,000 (US$100). This is especially true among Generation Z (48%).
While Gen X investors have a higher percentage (39%) of individuals investing in the middle ranges of Rs. 30,000 to 300,000, Gen Y investors have a higher percentage of individuals investing in the higher ranges.
32 percent of Gen Y investors have invested more than Rs. 300,000 (US$ 1000). This implies that Generation Y may have more disposable income and motivation to invest.
The data reflects a wide range of investment capacities among Pakistani crypto investors, with the younger generation beginning with smaller amounts.
- Exposure
In Pakistan, 69 percent of crypto investors want to be a part of the future, while 44 percent want to accumulate wealth in the long run, indicating a focus on the potential for long-term value appreciation and capitalizing on the growth of crypto as an asset class.
49 percent invest in cryptocurrency to make transactions more convenient, and 33 percent invest in cryptocurrency to protect asset value from depreciation.
Gen X investors are more likely to invest for long-term future and value storage, whereas Gen Z investors are more likely to invest in accumulated wealth.
According to the survey, the most common use of cryptocurrency is trading, with 46 percent of surveyed investors in Pakistan engaging in trading activities, while 30 percent indicated using cryptocurrency for HODLing (holding assets for the long term), earning through various yield-generating programs, or staking.
According to the survey, 29 percent of respondents have used cryptocurrency for peer-to-peer money transfers, and 22 percent have used cryptocurrency to purchase Non-Fungible Tokens (NFTs), indicating a growing interest in digital collectibles.
However, 20 percent and 18 percent of respondents, respectively, report using cryptocurrency to purchase luxuries and everyday goods.
To read our blog on “Crypto scammers attack young women in S. Korea to make $500k,” click here
