A third of cryptocurrency investors don’t know what they’re doing

It was the investment that was definitely going to make you a millionaire overnight. The type of asset that would carry you with it on the unstoppable tech wave barrelling into a dazzlingly bright future.At some point in the last five years, we believed that one in every eight UK adults has bought at least one cryptocurrency – digital or virtual-only assets that are held, traded and transferred electronically while being kept secure by cryptography (hence the name). Transactions are managed not by a central bank but on a peer-to-peer basis through technology that shares and synchronises data across multiple sites.Thousands of cryptocurrencies have failed but there are several thousand more out there and, like so many other aspects of our financial affairs, a handful – including Bitcoin, Ethereum, Tether, Binance Coin and Cardano – currently control the vast majority by market cap.They’re the ones we’ve at least heard of, even if that’s as far as we get, even though vanguard Bitcoin has been around for more than a decade. And worryingly often, that is indeed as far as we get.Data from behavioural finance specialists Oxford Risk suggests 36 per cent of UK retail cryptocurrency investors admit their understanding of the sector was either non-existent or poor when they bought.Even after owning cryptocurrencies, almost a quarter of investors still rate their knowledge of the assets and investment opportunities in the sector in the same vein.Oxford Risk’s study found around one in eight adults say they have bought cryptocurrencies in the past five years and just 21 per cent of them say their knowledge of the sector was good when they first invested.