Crypto may have crossed into the mainstream, but trust hasn’t followed. A majority of crypto users believe fraud levels in the sector are unacceptably high, with strong support for tighter regulation and consumer protections, according to a new report by CoinCover.
Its new report, The Trust Factor, digital asset protection firm CoinCover finds that most crypto users now view security failures, poor regulation and inaccessible funds as critical barriers to further adoption, with 62 per cent saying fraud levels are “unacceptably high” and nearly four in five calling for investor compensation schemes after hacks or technical failures.
The whitepaper draws on survey data from over 1,000 participants, most of whom currently hold or have previously held digital assets. It explores the growing tension between innovation and safety in the crypto space, as regulators, investors and industry leaders seek a clearer path forward.
The findings
According to the findings, 62 per cent of respondents believe fraud in the crypto space must be significantly reduced, while 79 per cent support mandatory compensation schemes to protect users from hacks or technical failures. Over half (53 per cent) highlighted lost access to wallets as a key issue needing urgent solutions, and 82 per cent called for a globally consistent regulatory framework.
The results point to changing expectations among crypto users. While early adopters may have been comfortable with higher risk, today’s retail investors are demanding safeguards that reflect those of traditional finance. Sixty-seven per cent of respondents said they would be more likely to invest in crypto if regulation matched other asset classes.
CoinCover’s chief commercial officer Anthony Yeung said the findings represent a shift in sentiment that industry players can no longer ignore. “As our research shows, the public is ready for crypto but only if it becomes safer, more transparent and more accountable. This isn’t just a call for regulation, it’s a call for progress and for frameworks that meet the unique demands of digital assets without stifling innovation.”
Industry comment
The report gathers views from senior leaders and experts across the digital asset space, who each offer a different lens on the question of trust.
Dima Kats, CEO of Clear Junction, pointed to the essential role of infrastructure in building confidence: “Regulators must strike a careful balance between multiple priorities. They need to protect consumers and financial infrastructure while also ensuring the country remains competitive as a market for innovation. Consumer protection can be achieved through well-designed frameworks, but also through education. Over time, people will naturally become more familiar with how crypto works. Fifty years ago, no one understood
credit cards.”
While Mark Walker, CEO and editorial director at The Fintech Times, suggests that crypto and traditional regulatory systems are currently pulling in opposite directions and that this tension is “perhaps the biggest barrier to progress”.
“Decentralised systems operate without borders or central oversight, while financial regulation remains highly centralised and nationally governed. This tension is perhaps the biggest barrier to progress. While the technology exists to scale crypto globally, political and regulatory cooperation is the sticking point.”
Other commentators across the whitepaper include Lucia Slater (Web3 Policy Space), Anastasija Plotnikova (Fideum Group), Eneko Knorr (Stabolut), Leïla Nassiri-Jamet and Andy van Susteren (MangoPay), all highlighting the urgent need for clearer rules, stronger protections and a more mature approach to trust in digital finance.
CoinCover describes the whitepaper as the first in a series of initiatives aimed at informing policymakers and guiding best practices, with the goal of empowering people to participate in crypto with greater confidence.
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