Fintech Advisory Service Fall 2021

Cryptocurrency and the New Investor of Today

Cryptocurrency has changed the outlook for retail investors and financial institutions as a high-return, high-risk alternative investment. Its legitimacy, however, has been highly debated in both Canada and worldwide. This report begins by briefly exploring the background of cryptocurrency, as well as its legal status within Canada and in other large economies.

Newly minted younger investors have entered the arena, which is becoming especially noticeable in the online/discount brokerage (ODB) and online advice channels. Moreover, these younger investors make up a large, disproportional share of cryptocurrency investors, and are aided by new platforms entering the Canadian market. Established platforms and investment firms are left to make important decisions regarding their stance on the polarizing topic of cryptocurrencies, as new entrants threaten to capture the potentially lucrative hoard of younger investors.

Data from various players in the investment space shines light on the various approaches undertaken by firms, while interviews help highlight the—at times opposing—opinions surrounding crypto, both as a store of value and as a valid investment.

The report also examines Investor Economics’ extensive ETF data comparing the successes of crypto ETFs, as compared to non-crypto ETFs.