Crypto vs. Stocks: Here’s What Young Investors Are Buying
Disclaimer: Please note that this article is not financial advice, it’s my personal opinion based on topics I’ve researched about. Thank you.
Did you know that millennials own more crypto than any other generation? According to this Yahoo article¹, 49% of millennials polled own cryptocurrency compared to 38% of Gen Xers and 13% of Gen Z. Younger generations are more bullish on cryptocurrencies because of their exposure to the internet in the Web 2.0 era. Because of the digital world we live in, investing has changed dramatically. I believe the emergence of cryptocurrency and NFTs will win over stock market investing due to their decentralized and easily accessible nature as well as other reasons listed below.
EASY ACCESS AND CONNECTION
As a millennial, I would choose crypto over the stock market any day. My reasons are that I am tech-savvy and feel more connected to the industry because I’m passionate about the future of digital currency. I’ve also taken courses and feel that I have more resources to help me invest in crypto. It’s also more convenient because you can invest from your laptop or phone in just a few clicks.
Connection is also a huge reason, people want to invest in something that they feel involved in. I think NFTs were a huge driver of younger generations investing in crypto because they allow for freedom of expression and are community-driven.
The point is you can get rich off of the stock market or cryptocurrency, but younger generations tend to invest in something that they believe in and feel connected to. This Investopedia² article states “More than half of millennials believe that cryptocurrency technology is accessible to everyone, and 49% call it “the future of finance.”
SOCIAL MEDIA EDUCATION
There has been a rise of “finfluencers” on social media who teach about cryptocurrency and other financial topics. Let’s be honest, most of us would rather take advice from people we have common goals with or relate to somehow. A lot of finfluencers make boring financial topics into a friendly and easy-to-understand style. I’ve noticed a wave of financial education on TikTok about cryptocurrency, which has sparked the younger generations to learn about investing. A study from CNBC³ reported that those within the age range of 18–34 years old, the Zoomers and Millennials, are 17% more likely to base their investment decisions on information gathered from social media.
LOSS OF FAITH IN FINANCIAL SYSTEMS
Younger generations have less trust in traditional financial institutions like banks because they are struggling financially or saw their parents struggle through previous recessions. A lot of millennials graduated in the heart of the 2008 recession, having a slow start to making an income. Because of financial circumstances that were out of their control, many are in high debt and aren’t able to afford homes. It was much easier for baby boomers to buy homes due to prices being very reasonable at the time. Younger generations want to take risks that will bring them higher returns, for the future and retirement. They also want more autonomy over their finances because they’ve seen repeated cycles of financial turmoil all over the world. Therefore, it’s easier for them to be in control of their finances with decentralized currency instead of depending on centralized institutions.
CONCLUSION
Overall, crypto has taken the lead as the winning investment for these younger generations due to many reasons including the above. If you’re a younger investor, what would you prefer to invest in and why? Please comment your thoughts below.
Citations:
- Dawn Allcott. Millennials Own More Crypto Than Any Other Generation
- Eric Rosenberg. Younger Generations More Bullish on Cryptocurrencies
- Outlook India. Why are Young Adults Investing in Bitcoin Over Stocks?
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