Journal of Consumer Affairs | ACCI Consumer Research Journal | Wiley Online Library

Summary

This paper develops and validates a Crypto Literacy Scale (CLS) to measure individuals’ knowledge of cryptocurrencies and blockchain concepts. The authors use Item Response Theory (IRT) to generate, test and refine items, starting from 16 candidate questions and producing a robust 10-item comprehensive scale and a 5-item “Quick 5” short form. Data were collected from stratified US samples on Prolific, and psychometric checks (EFA, CFA, local independence) support a unidimensional construct. The CLS correlates with real-world behaviours: crypto ownership, tenure, number of assets owned and frequency of learning about crypto are all associated with higher CLS scores. Demographic patterns (male, higher risk tolerance, crypto owners score higher) are reported, and the paper outlines practical uses for policy, education and future research.

Key Points

The CLS is an objectively scored measure built with Item Response Theory to capture crypto-specific knowledge (security, consensus, stablecoins, CBDCs, transaction mechanics).
Initial pool of 16 items was reduced to a validated 10-item scale (Cronbach’s α = 0.80) and a compact 5-item Quick 5 (α = 0.68) for easy embedding in other surveys.
IRT diagnostics and factor analyses indicate the CLS is effectively unidimensional and discriminates across a broad ability range.
Higher CLS scores strongly associate with owning cryptocurrency, longer ownership tenure, owning more crypto assets and frequent learning from credible sources.
Observed demographic correlates: males and higher risk-tolerance individuals score higher; some racial disparities (lower scores for Black respondents) are reported and discussed.
The CLS can be used to evaluate education programmes, guide consumer protection policy and improve regulatory capacity by measuring stakeholder knowledge.
The Quick 5 correlates highly with the full scale (r = 0.91) and is suitable for inclusion in large surveys where brevity matters.
Authors propose further cross-cultural validation, links to consumer well‑being, assessment of interventions and development of advanced specialised versions.

Context and relevance

Cryptocurrencies are volatile and technically idiosyncratic; financial literacy alone may not equip people to manage crypto risks. Regulators, educators and researchers need standardised tools to assess knowledge gaps. The CLS provides a timely instrument for policymakers, exchanges, educators and survey designers to measure crypto literacy reliably and track changes across populations and time.

Why should I read this?

Want a practical, field-tested tool that tells you who actually understands crypto — not who thinks they do? This paper delivers a ready-made scale (full and short forms), shows it works against real behaviours, and explains how to use it. If you’re designing policy, consumer education or market research around crypto, this saves you hours of guesswork.

Author’s take

Punchy and to the point: the CLS is a solid, empirically validated yardstick. The Quick 5 is especially handy — brief, defensible and strongly tied to real-world activity. If you care about reducing scam risk or improving regulatory conversations, the detail in the methodology is worth a careful read.