Who buys Bitcoin? The Cultural Determinants of Bitcoin Usage

Abstract

We examine the relationship between national culture and a country’s Bitcoin usage. Given that Bitcoin is a high-risk currency/investment that is frequently used for illegal purposes and whose market is relatively opaque, we focus on the cultural dimension of individualism, which has been related to risk-taking behavior and overconfidence. Using unique data that includes the originating country for Bitcoin transactions, we examine the relationship between individualism and a country’s Bitcoin usage for a sample of 80 countries between 2009-2018. We find a significant and positive relationship between a country’s individualism and its use of Bitcoin consistent with cultural values affecting the demand for such high-risk currency/investments.