Investing in cryptos is back in vogue, and, in order to market properly to the populace of hopeful new investors, a rash of surveys have been released that speak to the desires of Millennials, that age group that lurks between 18 and 34 years of age, and seniors, which today are rapidly becoming housemates for their young offspring. It turns out that this younger segment actually prefers Bitcoin to Gold and would like to invest in an Exchange-Traded Fund (ETF), if only there was one. Surveys of seniors, however, display how opposite older folks are on the risk spectrum, when quizzed about cryptos.
Nate Geraci, the head of The ETF Store, an investment advisory group that specializes in investment funds, appeared recently on the “ETF IQ” segment of Bloomberg and shared the results of his latest survey of Millennials and how they would prefer to invest:
Many of our younger clients ask if they can replace a core gold holding, seen as a hedge/non-correlated asset, with one that holds cryptocurrency, namely Bitcoin. In fact, 90% of our millennial clients suggested Bitcoin over the precious metal.
Unfortunately, a regulated BTC ETF has yet to receive approval from the Securities and Exchange Commission (SEC). The agency has turned down a dozen or so applications in the past few years and just last week pushed off the decision on two additional plans of note, one proposal from VanEck/SolidX, which included cooperation from the CBoE, and another one from Bitwise Asset Management that would trade on NYSE Arca platform. The new deadlines are in August, but insiders expect the SEC to delay once more out to October, the statutory limit for such decisions. The agency continues to be worried that the crypto infrastructure is not robust enough to block price manipulation.
At the time, Hester Peirce, one of several commissioners at the SEC and affectionately known as “Crypto Mom”, counseled Bitcoin enthusiasts to be patient:
I tell everyone ’Don’t hold your breath’. If I had my way, we would have already had one and maybe we would have had more… Investors should keep doing what they’re doing and not put too much weight in whether the SEC approves something or doesn’t approve something. Because these processes can take a very long time.
In another survey earlier this year, Blockchain Capital reported that: “42% of 18 to 34 year olds stated that they want to purchase Bitcoin over the next five years, compared to just 25% for those aged 45 to 54.” So what are these rabid fans of Bitcoin and possibly other cryptos to do with their “massive interest for the leading cryptocurrency”? There are private funds that focus on the crypto sector, like Grayscale’s Trust for example, but the premiums charged above the spot rate for trust units could turn off Millennials.
It is becoming a sign of the times that, within developed economies where opportunities for step-wise careers have been squeezed to extinction by rampant globalization, households today commonly are multi-generational. Children, parents, and grandparents live in close quarters, but, surprisingly, the appetite for risky investments has not changed amongst these diverse segments of the population. Seniors are not that interested in cryptocurrencies.
The Gold IRA Guide, a finance magazine, polled one thousand retirees to determine their impressions of cryptos. They are not that into Bitcoin. Even though the airways and Internet ads constantly speak to the crypto revolution, one third of those that responded had never heard of BTC. Another 56.7% of respondents were aware, but had no interest in investing, although a full 2.7% admitted that they actually had Bitcoin tokens in their portfolios. The reasons cited for avoiding cryptos like the plague appeared to have come straight from the mouths of Bitcoin cynics: Cryptos are “completely imaginary constructs and susceptible to jaw-dropping bubbles”. Televised talking heads, take a bow.
Mark Turner, the chief editor at the Gold IRA Guide, made these suggestions:
Taking into account this most popular survey response, Bitcoin must do a better job of educating and explaining the many benefits its underlying blockchain technology offers businesses and industries to this audience. It also must dispel the myth that it is a completely imaginary construct with no real life value – something that tends to scare away older investors who remember bubbles all too well.