Why Millennials Love Crypto
And why they’re changing the way we invest
The Financial Times recently ran an article about how Millennials now prefer to invest in Bitcoin rather than buy a property. And while the picture is a bit more complicated than the headline might suggest, it got us thinking…
The study they carried out showed that, for one-fifth of Millenials, cryptocurrencies are now their investment of choice. But they barely scratched the surface of why this might be the case.
It’s worth starting with the bad rep Millennials seem to get from, well, everyone. They’re overly-ambitious (so they don’t stay long in jobs), they’re ‘obsessed’ with curating their social media selves — and they prefer to splash out on avocado toast than save for a deposit, or so the stereotype goes. But how can they be both financially irresponsible and surprisingly savvy when it comes to investing?
It seems to stem from the situation Millennials find themselves in — plus an unusual set of skills that makes them not so bad at investing, after all.
First, they’ve already gone through a couple of recessions and started out in a relatively stagnant job market. It’s been shown that they really do have it much harder than the older generation.
It’s also worth pointing out that a lot of the criticism of Millennials is purely anecdotal. When we compare their finances with the previous generation — and adjust them for inflation, it’s plain to see. They don’t earn as much, they pay more out in living expenses, and they get on the housing ladder much, much later — if ever.
Added to this, is a healthy scepticism towards financial institutions. This seems to be confirmed by the fact that traditional investments — like shares, real estate and cash — are suffering right now.
When you take all this into account, you can start to see why more and more Millennials seem to be exploring alternative investments — like crypto.
Then, there’s that unique set of skills. They grew up with the Internet and understand the power of technology, which makes them natural innovators and early adopters. They think nothing of transferring money online; they’ve been doing it all their lives. And many of them are employed in the digital, financial and creative industries — all technological proving grounds.
So we can start to see why a fifth of Millennials may well choose cryptocurrency as their investment of choice. It’s not a case of naive risk-taking, though. They’ve lost faith in the systems that helped their parents and see opportunity in these new digital currencies. They, after all, are the ones who are using them. And, for them, perhaps even the most modest gain beats the meagre interest of today’s saving accounts.
Now where’s that moon?
Until next time!
