What Predicts Crypto Holding in Europe?
New evidence from the EU’s 2023 financial literacy survey
Are Crypto Holders Overconfident?
A common story about crypto is that it attracts overconfident investors. That view shows up often in the literature, and papers such as Kim, Hanna, and Lee (2023) have found a positive link between overconfidence and cryptocurrency investment. In this paper, we examine whether the same pattern appears in recent EU-wide data.
Using the 2023 Flash Eurobarometer on financial literacy, the paper looks at whether recent crypto holding is associated with financial knowledge, digital confidence, and overconfidence.
We find that crypto holders do not look more overconfident when overconfidence is measured as miscalibration between where people think they stand and where their observed financial knowledge places them within their country. Rather, the relationship runs in the other direction.
The figure below shows the distribution of the overconfidence gap for holders and non-holders. The two groups overlap heavily, with crypto holders shifted slightly to the left rather than toward greater overplacement.
Our regression analysis shows a similar pattern. The socio-demographic predictors such as age, income, and occupation mirror the findings from prior studies. Crypto-asset holders are younger, more likely to be male and higher income individuals. However, once the full set of controls is included, overconfidence is negatively associated with crypto asset ownership.
What makes this finding interesting is not just that it goes against a familiar stereotype, but that it points to the importance of measurement. When self-assessed financial knowledge is asked in relative terms, overconfidence is better captured as a gap between perceived and observed rank. Under this specification, the image of the overconfident crypto holder becomes much less clear. The working paper and reproducibility materials are linked below.
Full Working paper
Reproducibility materials
The full reproducibility materials for this working paper are available in this FIRSA GitHub repository. The repository includes the main replication script, variable construction logic, model outputs, and exported figures.
Citation
Hernández Sánchez, Alfredo. 2026. Overconfidence, Financial Literacy, and Crypto Asset Ownership in Europe. FIRSA Working Paper No. 2026/01.