Virtual assets are a new investment option with highly volatile prices. Some investors are drawn by potential growth, while others look to profit from price swings. However, investment decisions are not only influenced by market factors or price changes but also by mental shortcuts.
The Investor and Financial Education Council recently released the “Behavioural Science Study on Investor Behaviour in the Virtual Asset Markets 2025,” conducted by the Department of Applied Social Sciences at The Hong Kong Polytechnic University. The study surveyed 1,000 virtual asset investors aged 18 to 69. Findings show that these investors often rely on mental shortcuts when making investment decisions, with the five most common being:
- Reliance on past investment experience (Anchoring bias)
- Fear of missing out when prices rise (FOMO)
- A tendency to hold on to losing assets while rushing to sell profitable ones (Disposition effect)
- Continuing to hold during periods of sustained price declines in the expectation of a market reversal (Gambler’s fallacy)
- Reliance on guidance from authority figures, experts or opinion leaders (KOLs) (Authority bias)
Four main virtual asset investor archetypes
After analysing the data, the research team identified four consolidated behavioural types among virtual asset investors:
| Types | Behaviours | Percentage of respondents |
|---|---|---|
| 1. Socially influenced risk averter | These investors tend to follow others' investment choices and asset selection, and they are easily influenced by market trends and social media. They display high risk aversion and pull back after experiencing financial losses. | 34% |
| 2. Stubborn loss holder | When prices fall, these investors tend to hope for a rebound and refuse to accept losses, leading them to hold unprofitable investments for long periods of time. | 26% |
| 3. Confident risk-seeking optimist | These investors believe that they can beat the market. They tend to rely on intuition and, after profiting, often invest more and take greater risks. | 22% |
| 4. FOMO-driven overreactor | These investors are highly reactive to market surges and often pursue swiftly appreciating digital assets. Their choices are heavily swayed by short-term price movements, causing them to neglect other important considerations. | 18% |
Don’t let mental shortcuts or emotions affect your decisions
As with any investment, those investing in virtual assets should remain objective and rational, continuously improve their financial literacy, and seek out reliable market information. It is important not to rely on mental shortcuts or let emotions influence decisions, as this can lead to irrational investment choices. Additionally, in the virtual asset circle, the phrase “DYOR” (Do Your Own Research) is widely used, highlighting the importance of conducting independent research and analysis rather than blindly following others’ opinions.
Develop good investment habits
Consider the following virtual asset investment tips to cultivate strong and effective investment habits:
| Do's | Don’ts |
|---|---|
| Research thoroughly to understand the features, operation, and potential risks associated with virtual assets. | Invest out of fear of missing opportunities |
| Evaluate your risk tolerance | Invest with a gambler’s mentality |
| Mitigate risk through a diversified portfolio and allocating investments across different asset classes | To go all in |
| Rational thinking and judgment | Easily believing others’ opinions and blindly following the crowd |
| Invest within your financial capabilities | Invest with borrowed funds |
| Conduct transactions through regulated channels such as SFC-licensed virtual asset platforms, securities firms, or banks. | Use unlicensed or overseas trading platforms (Unlicensed trading platforms carry high potential risks, and overseas platforms, even if they are licensed or registered in their home jurisdictions, may not have adequate measures to protect Hong Kong investors.) |
| Beware of virtual asset-related scams | Believe in virtual asset investment opportunities that promise high returns with minimal risk. |
17 June 2026
