Crypto is a hedge for 46% of Russian retail investors, survey states

Published at: Nov. 29, 2021

Almost half of retail investors in Russia believe that cryptocurrencies like Bitcoin (BTC) are a hedging asset associated with stable income, according to a new survey.

Financial publication Investing.com has polled 1,000 Russian retail investors to find out the most requested types of alternative investments.

According to a survey of 1,000 Russian retail investors by Investing.com, as many as 46% of respondents viewed cryptocurrencies as a potential defensive asset allowing them to hedge against financial risks at times of an economic crisis.

Russian retail investors favored crypto more than real estate as just 37% of respondents investing in alternative assets considered buying real estate an effective investment instrument.

Real estate was historically the top hedging asset in Russia, according to Anastasia Kosheleva, the head of Investing.com’s Russian division. She noted that cryptocurrencies have emerged as the biggest investment trend in 2021 as they outstripped other traditional assets including foreign exchange currencies and stocks.

Out of many cryptocurrencies, Bitcoin is apparently the most popular alternative investment for Russians. According to a study by the big data platform Brand Analytics, Bitcoin was the most popular cryptocurrency in Russia in October, outpacing coins like Tether (USDT) and Litecoin (LTC) in terms of social media mentions.

Cryptocurrencies have been growing increasingly popular among Russian investors in recent years, with 77% of Russian investors preferring Bitcoin to gold in a survey last year.

Last week, the Bank of Russia published a financial stability report, noting the country’s growing role in the global $2.8 trillion cryptocurrency market. The central bank mentioned that Russia ranks third in the world in terms of the national BTC hash rate and is one of the biggest users of the Binance cryptocurrency exchange.

Amid growing inflation and the ongoing COVID-19 pandemic, global investors have been increasingly looking at cryptocurrencies like Bitcoin as a hedge against financial risk.

According to Damian Courvalin, Goldman Sachs’ head of energy research, investors have been increasingly hedging against inflation using crypto in addition to traditional assets like gold. “Just like we argue that silver is the poor man’s gold, gold is maybe becoming the poor man’s crypto,” he said in mid-November.

Previously, Pendal Group's head of alternative duration strategies, Vimal Gor, argued that cryptocurrencies should be added to new alternative defensive portfolios as government bonds have lost their value as a hedge against risk.