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- U.S. households told that Bitcoin had risen 14% over the previous year were about 23% more likely to report owning crypto in a later survey.
- A Federal Reserve Bank of Cleveland study suggests that strong Bitcoin returns can encourage people who were previously outside the market to consider buying cryptocurrency.
- Researchers randomly divided participants in a 2025 survey into a control group and six treatment groups. Participants received information about Bitcoin, the S&P 500, GameStop or the Federal Reserve’s inflation outlook.
- One Bitcoin group was shown its return over the prior 12 months, while another was presented with a Bitcoin price chart.
- The two Bitcoin treatments increased the likelihood of reported crypto ownership in a follow-up survey by 2.41 and 2.48 percentage points. Given that around 11% of participants initially owned crypto, the increase represented roughly 23% growth from the starting level.
- The ownership analysis covered 5,352 respondents surveyed between the second and fourth quarters of 2025. Researchers accounted for participants’ existing crypto holdings, while ownership was based on self-reported data rather than transaction records.
- The Bitcoin information also increased respondents’ desired crypto allocation by roughly 2 percentage points, compared with an average 4.3% allocation among the control group.
- Participants mainly increased their crypto exposure by reducing the amount they wanted to hold in cash, checking accounts and savings accounts. Their desired allocation to stocks also rose.
- Those shown Bitcoin’s positive performance expected crypto to deliver returns 3.2 percentage points higher over the following year than the control group. Participants shown the price chart increased their return expectations by 1.2 percentage points.
- The effect was strongest among people who said they stayed away from crypto because they lacked enough knowledge about it. Meanwhile, the Bitcoin information did not significantly change the views of respondents who already considered crypto a bad investment.
- Information about S&P 500 gains also increased the likelihood of later crypto ownership, although it did not change respondents’ intended portfolio allocations.
- The researchers found that strong past returns can attract new investors, potentially creating a feedback loop in which fresh buying drives prices higher and encourages even more participation.
- The findings point to one possible mechanism behind speculative bubbles: rising returns can boost expectations, attract new buyers and create additional upward pressure on asset prices.
