An increasing number of Filipinos in mid-level careers are now investing in cryptocurrency due to high returns, the convenience of tracking, and easy control over their assets, according to a nationwide survey conducted by the research firm Capstone-Intel Corporation.

Of the 1,204 respondents who say they are aware of cryptocurrency, at least 42 percent have invested in the new virtual currency. Most of them are males aged 35 to 44 and 25 to 34. The highest percentage of crypto investors come from CALABARZON, while the National Capital Region (NCR) and Central Luzon followed with equal share of investors.

“The survey reflects the high interest and optimism of many Filipinos in cryptocurrency, mostly those looking for ways to invest so they can increase their income,” said Eero Rosini Brillantes, CEO of Capstone Intel Corp. during the company’s grand launch on June 30, 2023, at the Marquis Events Place in BGC, Taguig City.

Brillantes said provided that there is a strong regulatory environment, cryptocurrency is a promising platform among the overseas Filipino workers (OFWs) in facilitating the transfer of their remittances, given its ease of tracking and control of transactions through digital platforms.

The Philippines is one of the countries receiving high levels of remittances, which grew by 3.6 percent to US$36.14 billion in 2022, according to records from the Bangko Sentral ng Pilipinas (BSP) in February 2023. The Philippine Statistics Authority (PSA) estimates that there are 1.83 million OFWs in 2021. But the OFWs counted by the PSA are only those who are registered and have left the country legally. If the number of unregistered Filipino migrant workers were to be included, the number could be as high as ten times higher than the PSA figure.

“More Filipinos are taking advantage of the advancement in financial technology, and cryptocurrency is proving to be a more convenient and cheaper alternative than the existing remittance and commercial bank channels,” said Brillantes.

The study entitled: “Survey on perception, awareness and investments practices of Filipinos on cryptocurrency and NFTs, and awareness on blockchain technology,” also showed that more than half of the respondents rely on a monthly salary, followed by allowance and self-employed earnings. “This indicates that more than half (crypto investors) are employees. A small number of respondents also earn through commissions and earnings from business,” the study stated.

Of those respondents who invested in cryptocurrency, 93 percent invested in Bitcoin, according to the study. Also, of those who invested in Bitcoin, at least 54 percent also invested in Ethereum, and the remaining invested in Binance USD.

The study showed that 50 percent of those who invested in cryptocurrency spent from Php1,000 to Php5,000 while close to 30 percent spent less than Php1,000, and the remaining 30 percent spent up to Php10,000.

Meanwhile, the study showed that fewer females (35 percent) are investing in cryptocurrency, with lesser amounts of up to Php3,000; while more males (48 percent) are investing, and with higher amounts of over Php10,000.

Among the different cryptocurrencies, Bitcoin (93 percent) was the most popular choice among the respondents, followed by Ethereum, Binance USD and Dogecoin.

The study also covered the awareness and perception of Filipinos about non-fungible tokens or NFTs. Among the respondents, 58 percent say they are aware of NFTs, with more males (66 percent) than females (34 percent). The highest number of NFT investors also come from CALABARZON with 65 percent of the respondents, followed by those from NCR and Region 10. The study also showed that respondents (27 percent) from the Bangsamoro Autonomous Region for Muslim Mindanao (BARMM) and Region 8 have the least awareness of NFTs.

Of the 693 respondents who are aware of NFTs, at least 45 percent perceive it as a digital token, while 43 percent think that it is a digital asset. NFT investors also get information from social media and internet sites. Also, the NFT investors belong to a younger group, 18 to 24-year-olds (29 percent) and 25 to 34-year-olds (38 percent). Across the region, the highest percentage of those who invested are from Region VIII at 42 percent and Region 8 at 45 percent. NFT investors spend less than Php1,000 and Php1,000 to Php 3,000.

Respondents who invested in NFTs say these are assets that can easily be transferred, while half of them say they are convenient and can be tracked easily.

The study also covered Blockchain that 62 percent of the respondents said they were aware of. More males, mainly from the NCR at 70 percent are aware of Blockchain, followed by Region 3 and CALABARZON.

Cryptocurrency, or virtual currency (VC), as referred to by the Bangko Sentral ng Pilipinas (BSP) is a type of digital currency being transacted online by a community of users. The VCs are used as a medium of exchange to purchase items or real goods from online shops that are willing to receive VC as payment. Also, the VCs can also be exchanged for actual cash through the companies that are part of online users, the BSP explained.

A BSP Primer on VC said cryptocurrency has many potentials for Filipinos, with the increasing number of Filipino online shops, to pay for goods and services as well as digitally transfer funds. The cryptocurrency has the potential to provide “convenient, faster and cheaper” remittances and transfers for OFWs and their families compared with traditional remittance and payment schemes.

(https://www.bsp.gov.ph/Media_and_Research/Primers%20Faqs/VC.pdf)

With the rising popularity of VC exchanges, the BSP believes this could help lower transaction costs and improve services in commercial banks and remittance centers.

Cryptocurrency also promotes financial inclusion, according to the BSP primer as it aims to be used to facilitate and expand financial services for low-income Filipinos and those living in far-flung areas where traditional financial service providers like banks are unable to reach.

Lastly, the BSP primer cited that the widening use of cryptocurrency could boost the country’s E-commerce industry, through social media, mobile technologies and other innovative platforms.

There are also disadvantages of cryptocurrency, according to the BSP. These include inherent risks such as price volatility, since the value of cryptocurrency is driven by supply and demand, prices are unstable.

Also, users face risk of loss, since there is no legal protection for them. Cryptocurrency is also risky for unlawful use, since transactions have a high degree of anonymity. The pseudo-anonymous and online nature of VCs makes them attractive to fraudsters, scammers, and people intending to do unlawful activities (e.g., money laundering/ terrorist financing).

Lastly, the BSP said cryptocurrency use is prone to theft and loss since all assets being transacted online can be subjected “to hacking or theft, virus infection, and other cyber threats.” In the event of fraudulent, unauthorized and erroneous transactions, crypto users cannot lodge complaints since there is no existing central authority.

The study also showed that cryptocurrency has not attracted some Filipinos. Of the 863 respondents who have not invested in cryptocurrencies, at least 43 percent said they do not know how to invest in it, followed by those who think it is too risky, and those who are unfamiliar with cryptocurrencies.

Ella Kristina D. Coronel, Research Director of Capstone-Intel Corp. said, “This study describes the current perception and practices of Filipinos who are aware of cryptocurrency, NFTs, and blockchain. Those who are aware and invested are of different ages and across all regions in the country. Cryptocurrency and NFTs create new financial opportunities most especially for creators of digital art and content. It is best that we have more information on how to invest, and be more educated on these high impact innovations for a safer space for investment so as not to be lured by scammers and have more opportunities in expanding our financial resources.”.

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