Bitcoin has taken a positive trajectory after fall out due to the coronavirus pandemic. The value of bitcoin has gone down to nearly $4700 when the pandemic hit major parts of the world. However, it bounced back to its previous value and now the value is hovering around $11000. It is expected that the value will grow further this year.
And the majority of the bitcoin investors are Millennials. Whereas baby boomers invest in traditional investment assets. Millennials represent a group of people aged between 24 to 40 years. Individuals of these age groups are more ambitious, confident, and have risk-taking ability. With these traits, they not only invest in bitcoin but also other cryptocurrencies too.
However, bitcoin is the favorite among all other crypto coins. Because it is considered as the king of digital currencies with the highest market capitalization.
Why Millennials are Investing More in Bitcoin and Altcoins
With the rapid growth and development in technology, Millennials can adopt everything quickly. This is also true in case of investment assets, as they can understand the cryptocurrencies easily than the older generation individuals. Now let’s explore the reasons why they invest more in bitcoin and other digital coins.
Cryptocurrencies Serve as Alternative Assets During Economic Instability
In this digital age, as Millennials are more active and acquainted with the digital system, they found crypto assets as alternative investment options during economic instability. Because cryptocurrencies can’t be devalued as governments do not have control over digital currencies. So government can’t inflate cryptocurrencies to stabilize the economy. Because the supply of bitcoin and other cryptocurrencies are fixed, so it can’t be inflated. Therefore, cryptocurrencies are great alternative investment options during any geopolitical uncertainty or economic instability.
Bitcoin as Digital Gold
We know that gold is a great investment opportunity during any market uncertainty. In traditional investment, it is considered as a safe-haven during any economic instability. Investors diversify their portfolio with gold to hedge against inflation. This helps them to manage their risk and average their profit.
Among digital assets, bitcoin is the most trusted and valued digital currency. This is considered as a safe-haven during market uncertainty by financial experts. Even some crypto experts also call it “digital gold”. That’s why most of the crypto investors invest major portions of their capital in bitcoin than any other digital assets.
Liberal Asset Class
One of the major reasons Millennials invest more in cryptocurrencies is due to freedom. Cryptocurrencies are operated through a decentralized digital ledger that allows the users to send, receive, and store money without any third party. Moreover, it also offers more control over digital currencies than traditional currencies. As the younger generations want independency, so they invest more in a liberal asset class like cryptocurrencies.
A recent report revealed that Millennials reduced its investment in ETFs and stocks. They invested their major percentage of capital in bitcoin and altcoins. For instance, they invested in the GBTC fund (a bitcoin investment product) offered by Digital Currency Group more than Netflix and Disney. It is clear from the above report that, Millennials are more interested in digital currencies than traditional investments.
High-Returns and Demand in the Future
No doubt cryptocurrencies are riskier than any other investment option. With more risk, they are also providing high returns. For instance, the bitcoin price has plunged from 1000 US dollars to nearly 20000 US dollars in 2107. This set a record in the history of investment after which most of the investors are interested in the cryptocurrencies. According to many crypto experts, Millennials should take high-risk because they are young and they should take risks at a young age.
Bottom Line
All of these above factors show that Millennials are embraced cryptocurrencies as their major investment tools. If you are between the age group of 24 to 40, then you should also consider bitcoin and other digital coins to your portfolio. Learn about different digital coins, crypto exchanges, digital currency funds, etc. Keep reading to know more information on purpose of blockchain
Hopefully, the article has helped you to provide some insight into the adoption of cryptocurrencies by Millennials. If you have any concerns regarding crypto investment, please mention below.