- U.S. households shown that Bitcoin had gained 14% over the previous year were roughly 23% more likely to report owning cryptocurrency in a later survey.
- A Federal Reserve Bank of Cleveland experiment suggests that Bitcoin’s recent gains can encourage people to enter the crypto market, providing evidence that past performance can influence new investor participation.
- Researchers randomly assigned participants in a 2025 survey to a control group or six groups that received information about Bitcoin, the S&P 500, GameStop or the Federal Reserve’s inflation forecast.
- One group was given Bitcoin’s return over the previous year, while another was shown a chart of its price history.
- The two Bitcoin-related treatments increased the probability of reported crypto ownership in a follow-up survey by 2.41 and 2.48 percentage points. With approximately 11% of respondents already owning crypto, that amounted to an increase of about 23% relative to the initial ownership rate.
- The ownership analysis included 5,352 respondents surveyed during the second through fourth quarters of 2025. The researchers accounted for participants who already owned crypto and measured self-reported ownership rather than verified transactions.
- The information also increased participants’ desired allocation to crypto by about 2 percentage points, compared with a 4.3% average allocation among the control group.
- Respondents primarily shifted funds away from cash, checking accounts and savings accounts to make room for additional crypto exposure, while their desired stock allocations also increased.
- Participants who learned about Bitcoin’s positive 12-month return raised their expected crypto returns for the coming year by 3.2 percentage points compared with the control group. The price chart produced a smaller 1.2-point increase.
- The strongest reaction came from respondents who said they avoided crypto because they lacked sufficient knowledge about it. The Bitcoin information had no statistically significant effect on people who already viewed crypto as a poor investment.
- Information about the S&P 500’s performance also increased subsequent crypto ownership, although it did not lead participants to change their intended portfolio allocations.
- The researchers found that strong historical returns can attract new participants, potentially creating a cycle in which additional buying pushes prices higher.
- The findings offer one explanation for how speculative bubbles can form: rising prices lift return expectations, draw fresh investors into the market and potentially create even more upward price pressure.
Why Bitcoin Rallies Bring New Buyers Into Crypto, According to a Fed Study
