Affluent Millennials pour money into crypto, poll shows

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• The crypto market crashed in May 2022 and bitcoin has lost almost half of its value in the last six months.
• But wealthy investors between the ages of 21-42 are still investing in crypto, says a new study from Bank of America.
• Over half of young people who invest in crypto get advice from social media platforms, such as TikTok.

The price of bitcoin has fallen 48% in the last six months. But according to Bank of America’s 2022 Private Bank Study of Wealthy Americans, wealthy millennials are still pouring money into crypto.

Stories of people losing their life savings when the crypto market crashed earlier this year in May didn’t scare people aged 21 to 42.

According to the study, conducted between May and June 2022, 75% of wealthy young people – defined as high net worth and ultra high net worth – agreed that it is no longer possible to achieve above-average returns in traditional investments such as stocks and index funds. , compared to 32% of wealthy people aged 43 and over.

Rich young investors believe crypto can help them build more wealth

In the study, 29% of affluent young investors said crypto offers a leading opportunity to build wealth, with real estate second at 28%. On the other hand, 41% of older investors said that traditional investments, such as stocks, index funds and mutual funds, are the leading way to build wealth.

Despite the volatility of cryptocurrency, three times as many young investors believe that cryptocurrency is an effective long-term investment vehicle compared to older investors.

Financial experts recommend that crypto investors balance their riskier bets with safer, more traditional investments like stocks and bonds, saying that crypto should make up a very small portion of your portfolio, ideally less than 5%.

Young investors surveyed by Bank of America said they allocate 15% to cryptocurrencies, while those 43 and older said they only invest 2% of their money in crypto.

Over half of young investors get crypto advice on social media

More than 60% of young people said they understand cryptocurrency fairly well, compared to 12% of wealthy people aged 43 and up; young investors said they get most of their crypto advice on social media platforms like TikTok, Instagram or Reddit.

Older investors said they turn to Internet research or professional advisors at higher rates than young people.

There is no way to know how the crypto market will react to rising inflation rates and a looming recession. But if you decide to start investing or continue investing in crypto, just know that many wealthy millennials are on the ride with you.