New figures suggest that 2.3 million people in the U.K. now own cryptocurrencies — 400,000 more than last year.
But the data from the Financial Conduct Authority isn't all good news. Over this time, understanding of how digital assets work appears to have fallen.
On average, Britons have invested roughly £300 ($417.81) into digital assets.
The surge follows an extraordinary bull run for Bitcoin, which took prices as high as $64,000.
Overall, 78% of adults in the country have now heard of cryptocurrencies, compared with 73% in 2020. Increasing media coverage over fluctuations in the crypto markets likely played a role in this.
With enthusiasm over crypto growing, 53% of those questioned by the FCA said they have had a positive experience with their investment so far and are likely to purchase more.
In keeping with data from many other countries, the typical crypto investor is male and under the age of 35.
A Big Warning
The FCA's view is that cryptocurrencies amount to a high-risk investment, and those who make a purchase should be prepared to lose all of their money.
Although most people use disposable income to snap up crypto, there appears to be a growing trend of people borrowing money in order to gain exposure.
Regulators in the U.K. have stressed that the unregulated nature of digital assets means that they may not be able to receive support if something goes wrong.
AJ Bell's financial analyst Laith Khalaf told the PA news agency that some consumers are "playing with fire." He added:
"There is a dark underbelly lurking in the figures, which suggests there is still potential for widespread consumer harm."