The majority of investors in digital assets are failing to prioritise crypto-specific metrics when assessing the viability of crypto assets, suggests research.
A study of 2,000 crypto market participants in the UK, US and Canada conducted by fintech Broadridge found that the majority favour conventional metrics such as risk factors and security (54%), cash flow (52%) and management team holdings (43%) when considering investment.
In contrast, crypto-specific measures such as tokenomics and network performance were cited by 16% and 28%, respectively and did not feature in the top five factors.
According to Broadridge, the findings suggest that investors do not fully appreciate the importance of so-called crypto-native factors, such as network performance, which can give insights into how the platform behind the crypto asset is performing.
“To help better inform and educate investors, metrics that track crypto asset performance should be standardized, better disclosed and made more easily accessible, especially for retail investors needing the most relevant information and support possible to make informed decisions,” said Rob Krugman, chief digital officer, Broadridge. “For any market to survive and grow, you need trust, and trust isn’t possible without transparency.”
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