Showing U.S. households that bitcoin BTC$77,553.91 had gained 14% over the previous year made them more likely to buy crypto, offering evidence that past returns can pull new investors into the market.
According to a Federal Reserve Bank of Cleveland working paper, researchers randomly divided participants in a 2025 survey into a control group and six groups shown information about bitcoin, the S&P 500, GameStop or the Federal Reserve’s inflation forecast.
One group was told bitcoin’s return over the previous 12 months, while another was shown a chart of its price.
The bitcoin data increased the probability that respondents reported owning crypto in a later survey by 2.41 and 2.48 percentage points, respectively. About 11% owned crypto before the experiment, making the increase roughly 23% relative to the starting rate.
The ownership analysis covered 5,352 respondents across the second through fourth quarters of 2025 and controlled for whether they owned crypto before receiving the information. It measured self-reported ownership rather than transaction data.
The treatments also immediately raised respondents’ desired crypto allocation by about 2 percentage points from a 4.3% average in the control group.
Respondents largely made room by reducing their desired allocation to cash, checking and savings accounts, while also raising their planned stock holdings.
Being told of bitcoin’s positive performance raised expected crypto returns over the following year by 3.2 percentage points compared with the control group. The price chart increased expectations by 1.2 points.
The response was strongest among people who said they avoided crypto because they did not know enough about it. The combined bitcoin treatments had no statistically significant effect on those who already considered crypto a bad investment.
A chart of the S&P 500’s performance also increased subsequent crypto ownership, though information about stock returns did not alter desired portfolio allocations.
“Positive returns attract new participants, which raises the price further,” the authors wrote. “The experience of high returns in the past does not seem to lead individuals to expect any mean reversion; extrapolation of past returns into future returns seems to be the rule.”
The authors said the findings show one mechanism through which speculative bubbles can develop: Gains raise return expectations, attract new buyers and potentially push prices higher.
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