Erik Weijers, 14 days ago

60% of Dutch crypto owners don’t back up their wallet

Almost two-thirds of Dutch crypto owners do not have a backup of their crypto wallet. That is one of the interesting results of Multiscope's Cryptovaluta Monitor.

Multiscope does online market research and has published about the Dutch crypto market before. For example, their Summer 2022 Monitor showed that nearly 2 million Dutch people own crypto. 

With great powers come ...

'With great powers come great responsibilities'. After you purchase crypto, you really have ownership over your money. Especially in the case of Bitcoin, there is no - or at least less - counterparty risk, which is not the case with traditional money. After all, money in a bank account is not legally your property. True, the government does guarantee balances up to a certain amount, but this proves all the more that a bank cannot guarantee that your money is safe there: only a fraction of outstanding balances are owned by the bank. 

So much for great powers: what about responsibilities? Not your keys, not your coins, after all. If you have your crypto outstanding with a crypto broker or exchange, you have no more guarantee that your coins are safe there than money in a bank. That's why many crypto owners choose to keep them in self-custody. That amounts to keeping your password safe, also known as a seed phrase. 

But your own responsibility doesn't stop there. Because a paper-based password can be lost, or it can burn in a fire or get water damage. You can fix that vulnerability by storing a copy of your seed phrase elsewhere. The research shows that two-thirds of Dutch people don't do that.

The survey

A vast majority (60%) of crypto owners have no more than one wallet to store their crypto coins. That could mean they either have everything on a single crypto exchange, or have their own wallet but without a backup.  

A few more related facts: 

  • 18- to 34-year-olds take a more responsible approach to self-management than the older generation: 50% of the younger generation have backed up wallets, compared to only 21% among those over 50.
  • 41% indicate that no one else has access to their crypto.
  • 5% reveal that they have included things in their will about access to their wallet. 

Conclusion

Except for the occasional gold fanatic, keeping your money in your own wallet is a new skill for people. As such it is understandable that many people are still vulnerable in this regard. But especially with larger amounts - and what are currently small amounts may be large amounts in a few years - it's worth thinking about backing up your wallet. And about scenarios in which you can no longer access it yourself – indeed, the scenarios you’d rather not think about...

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