In October, Bitcoin was the most prominent cryptocurrency in Russia, surpassing both Tether and Litecoin
According to a new survey, over half of retail investors in Russia think that cryptocurrencies like Bitcoin (BTC) are hedging assets connected to consistent income.
Investing.com surveyed 1,000 Russian retail investors to determine the most preferred types of alternative investments.
As per Investing.com's survey of 1,000 Russian retail investors, as many as 46 per cent of respondents considered cryptocurrencies as a possible defensive asset that would enable them to protect against financial risks during an economic downturn.
Russian retail investors preferred crypto over real estate, with just 37% of respondents investing in alternative assets considering real estate to be an efficient investment instrument.
According to Anastasia Kosheleva, the head of Investing.com's Russian division, real estate has historically been the top hedged asset in Russia.
She stated that cryptocurrencies have evolved as the most important investing trend in 2021, surpassing other traditional assets such as foreign exchange currencies and equities.
Of several cryptocurrencies, Bitcoin appears to be the most prominent alternative investment for Russians. According to a Brand Analytics study, Bitcoin was the most famous cryptocurrency in Russia in October, outperforming currencies such as Tether (USDT) and Litecoin (LTC) in terms of social media mentions.
Cryptocurrencies have grown in popularity among Russian investors in recent years, with a survey last year showing that 77% of Russian investors preferred Bitcoin to gold.
The Bank of Russia issued a financial stability report last week, highlighting the country's expanding position in the $2.8 trillion global cryptocurrency sector.
Russia ranks third in the world in terms of national BTC hash rate, according to the central bank, and is one of the most active users of the Binance crypto exchange.
With rising inflation and the ongoing COVID-19 pandemic, global investors are increasingly seeking cryptocurrencies like Bitcoin as a financial risk hedge.
According to Goldman Sachs' head of energy research, Damian Courvalin, investors are increasingly hedging against inflation using crypto in addition to traditional assets such as gold. He said in mid-November, "Just like we argue that silver is the poor man’s gold, gold is maybe becoming the poor man’s crypto."
Earlier, Vimal Gor, Pendal Group's head of alternative duration strategies, proposed that cryptocurrencies should be included in new alternative defensive portfolios since government bonds have lost their utility as a risk buffer.