Showing U.S. households that Bitcoin had risen 14% over the previous year increased their likelihood of reporting crypto ownership later by about 23%.
A Federal Reserve Bank of Cleveland study provides evidence that Bitcoin’s recent performance can influence people who have not yet entered the crypto market, with strong returns potentially encouraging new participation.
For the 2025 experiment, researchers randomly assigned survey participants to a control group or one of six groups that received information about Bitcoin, the S&P 500, GameStop or the Fed’s inflation projections.
Participants in one Bitcoin group were given its 12-month return, while another group was shown a chart tracking Bitcoin’s price.
The two Bitcoin treatments raised the probability of reported crypto ownership in a follow-up survey by 2.41 and 2.48 percentage points. Since roughly 11% of respondents initially owned crypto, the effect represented an increase of about 23% from the starting level.
The analysis covered 5,352 participants surveyed during the second, third and fourth quarters of 2025. Researchers adjusted for participants’ existing crypto ownership before the experiment and relied on self-reported holdings rather than transaction records.
The Bitcoin information also increased respondents’ desired crypto allocation by around 2 percentage points, compared with an average 4.3% allocation among those in the control group.
Participants mainly funded the higher crypto allocation by reducing the share they wanted to keep in cash, checking accounts and savings accounts. Their desired exposure to stocks also increased.
Learning about Bitcoin’s previous gains raised expected crypto returns for the next year by 3.2 percentage points compared with the control group. Showing participants a Bitcoin price chart increased expected returns by 1.2 percentage points.
The impact was most pronounced among people who said they avoided crypto because they lacked knowledge about it. By contrast, the Bitcoin information produced no statistically significant change among respondents who already believed crypto was a bad investment.
Showing participants the S&P 500’s previous performance also increased the likelihood that they would later report owning crypto, although stock-return information did not change their desired portfolio allocations.
The researchers found that strong past returns can attract new market participants, potentially creating a feedback loop in which fresh demand pushes prices higher and reinforces expectations of further gains.
Their findings point to a potential pathway for speculative bubbles: rising returns can increase expectations, bring new investors into an asset and generate additional buying pressure.
