Study suggests cryptocurrency owners share unique psychological and political traits

By Dr. Sanchari Sinha Dutta, Ph.D.Reviewed by Benedette Cuffari, M.Sc.Jul 7 2024

In a recent study published in the journal PLoS ONE, scientists examine the political, psychological, and social characteristics of individuals who buy and trade cryptocurrencies.

Study: The political, psychological, and social correlates of cryptocurrency ownership. Image Credit: Arsenii Palivoda / Shutterstock.com

Background

Cryptocurrency is a type of digital currency secured by cryptography. Unlike traditional currencies like the United States dollar (USD) and Euro, which are issued by governments, cryptocurrencies are often decentralized, which has created challenges for governments and regulatory bodies interested in regulating these transactions.

Cryptocurrency relies on blockchain technology to record all transactions, keeping these exchanges anonymous. However, its anonymity and irreversible nature pose significant security risks, as exchanges and wallets are easy targets for criminals participating in financial scams and terrorist attacks.

Despite these challenges that have prevented the widespread adoption of cryptocurrency, millions of individuals throughout the world have invested in this technology, with cryptocurrency assets worth a collective value of over USD 3 trillion in 2021. Thus, the increasing tendency of people to invest in these technologies and, consequently, engage in risky financial behaviors emphasizes the importance of investigating the associations between cryptocurrency ownership and individual political, social, and psychological characteristics.

Study design

The study cohort included a demographically representative sample of 2,001 American adults. Participants' responses about their involvement in cryptocurrency were collected between May and June 2022. Study participants also provided demographic information and responded to measures of various political, psychological, and social characteristics.

Important observations

About 30% of the study population reported being involved in cryptocurrency, which translates to about 77 million Americans participating in this form of digital exchange and investment. Cryptocurrency ownership was significantly associated with younger males with a higher educational background, financial status, and religious beliefs. A weak positive association was also observed with individuals of Black and Hispanic ethnicity.

Strong positive associations of cryptocurrency ownership were observed with conspiracism-related factors, including conspiracy theories and conspiratorial thinking.    

Regarding political orientations, cryptocurrency owners exhibited a wide range of left-right political ideologies, making it difficult to accurately categorize their political views. Overall, cryptocurrency owners were more likely to report populist sentiments and stronger non-left-right political attitudes. Cryptocurrency owners were also more likely to be supportive of extremist groups and identify themselves with the extremities of partisanship and ideology.

A positive association of cryptocurrency ownership was observed with involvement in normative political activities such as volunteering during elections, attending political meetings and protests, engaging in civil disobedience, and contacting elected officials. However, a positive association was also observed between cryptocurrency ownership and involvement in more problematic forms of interpersonal and political activities, such as being argumentative, intensifying conflict when disagreeing with others, and participating in political violence.

Moreover, positive associations were observed between cryptocurrency ownership and a range of 'dark' personality behaviors, including narcissism, psychopathy, sadism, and Machiavellianism, which reflects a strategic focus on self-interest and lack of morality and empathy for others.

Cryptocurrency owners were also more frequent users of alternative and fringe social media platforms as compared to mainstream social media platforms.

The researchers also performed a multivariate analysis that considered all relevant variables representing demographics, thinking styles and intellectual attitudes, personality characteristics, and media environments. This analysis revealed that male gender, higher reliance on alternative and fringe social media platforms, argumentativeness, and aversion to authoritarianism were the strongest predictors of cryptocurrency ownership.  

Among various social media platforms, Telegram, YouTube, Reddit, Twitter, and blogs were the strongest predictors of cryptocurrency ownership. In contrast, Facebook use was identified as the only negative predictor of cryptocurrency ownership.

Study significance

The analysis reveals that cryptocurrency owners are more likely to have various nonnormative and maladaptive characteristics as compared to those who have never owned cryptocurrency. Cryptocurrency users are also more likely to adhere to a wide range of political affiliations and identities, believe in conspiracy theories, have 'dark' personality traits, as well as collect information on current events, public issues, and politics from alternative or fringe social media platforms.    

Many governments are interested in more tightly regulating cryptocurrencies, emphasizing the importance of identifying the factors that attract people to own cryptocurrency. Thus, future studies are needed to analyze the differences in personal characteristics between different types of cryptocurrency ownership using well-developed multi-item questionnaires. Further research is also necessary to understand how the characteristics of cryptocurrency owners change over time as the currency becomes more or less accepted in society.