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Crypto fans are revolutionizing online investing

The majority of millennials and almost half of those in Gen Z think they’re savvy enough to invest without guidance from a financial professional. Take that, anti-crypto advisers.

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Almost since the day the first bitcoin was minted 12 years ago, financial advisers have been telling investors to avoid it. “Cryptocurrency is far too volatile and has proven itself to be the biggest bubble since the tulip bubble in the 1600s,” one declared in a 2019 advice column headlined “6 Risky Investment Fads to Avoid.”

I know, based on our research, that many have ignored these warnings, and that among those who have gone ahead and invested anyway, most feel pretty good about it.

For the longest time, there were only a few investment choices for people who wanted to go above and beyond a 401(k) or a savings account. Those with extra income typically opted for stocks, bonds, annuities, and real estate. Today, many adults in the United States — especially millennials and Gen Zers — find those granddad options about as relevant as a phone book.

Instead, according to a new national survey by The Harris Poll, almost nothing seems too risky for more and more of us when it comes to online investing. The trend lines are strong enough to suggest that if this is a fad, it’s unlikely to end soon.


Altogether, according to our poll, 16 percent of American adults today have money in cryptocurrencies such as bitcoin and Ethereum (the same percentage of adults buying bonds); 14 percent own meme or viral stocks such as GameStop (more than those who invest in annuities or exchange-traded funds); and 11 percent have purchased one-of-a-kind digital assets known as non-fungible tokens (only a percentage point less than those investing in commodities).

If that’s not enough, one in seven adults 40 and younger say they’ve bet on the outcome of game shows or the weather, according to the poll. Roughly a quarter of millennials and Gen Xers wager on sports. And most millennials say they’re interested in an app that would let them “invest” in the outcome of yes/no events, like whether Turkey will join the European Union.


The majority of millennials (ages 25-40) and almost half of those in Gen Z (ages 18-24), moreover, think they’re savvy enough to invest without guidance from a financial professional. Take that, anti-crypto advisers.

The corporate sector is starting to embrace these markets, too. Tesla recently disclosed it has bought $1.5 billion in bitcoin while Mastercard says it will allow merchants to begin to accept select cryptocurrencies for payment later this year. Investment firm VanEck just launched an exchange-traded fund tracking stocks getting buzz on Reddit and other social media. And everyone from Christie’s to the NBA is making money from the auctions of digital arts and video.

We may be at the beginning of a whole new mind-set about how and what we buy. “Gaming technologies are laying the foundation for a new interactive layer for online platforms that [will] eventually evolve into the metaverse,” Richard Yao, manager of strategy and content at IPG Media Lab, wrote in a recent essay. “And digital goods are a key ingredient of the metaverse.”

The shift to speculative investments began before the COVID-19 pandemic isolated many of us in front of our screens at home, respondents say in the survey, but it has accelerated throughout 2020 and into this year as commission-free trading on apps like Robinhood turned investing into something that felt more like an easy-to-win game, and as the value of down-and-out stocks touted on Reddit forums made early investors very, very rich. It helps, too, that total household wealth increased to a record high in 2020, giving people more money to play with.


Roughly half of adults investing in cryptocurrencies, meme stocks, and tokens that certify ownership of digital collectibles like celebrity-issued art or video clips say they began their purchases in just the last six months, following the lead of Gen Z, who discovered these markets seven to 12 months ago. Catching up with the kids, 40 percent of baby boomer investors in cryptocurrencies and meme stocks say they joined the rush in the past three months.

While boomers (ages 57 to 75) say they’re primarily investing to fund retirement savings, three in 10 people in Gen Z and millennial age brackets say they also are doing it to participate in something popular; a third of Gen Zers add they’re doing it just for fun.

Who else is into speculative investments? College grads and those with higher incomes, though, because they have more wealth, they’re also more likely to invest in conventional options such as stocks and bonds. Also people who are employed and parents of kids at home.

Also Black people and Hispanics. For instance, 25 percent of Black Americans and 15 percent of Hispanics say they’ve bought non-fungible tokens, versus 8 percent of white Americans. Minority adults are also much more likely to think that meme stocks and other unconventional assets will remain valuable in the long term. And they’re much more likely to want to wager on yes/no events if an app allowed it.


Regionally, the Northeast is deepest into these alternative investments, with one in five investing in cryptocurrencies and meme stocks. Midwesterners are the most risk-averse.

So far, much of this new-age investment is dabbling. Of those putting money in meme stocks or tokens, 60 percent say it represents less than a quarter of their total portfolio. There are a few exceptions: Gen Zers are heavily into cryptocurrency, with nearly half saying it accounts for upward of 75 percent of their portfolio.

Almost certainly, more people will risk their money on nontraditional investments for the chance to get rich (or richer). Two-thirds of Americans say they’ve made money on their investments — conventional as well as speculative— since they began, while only 10 percent say they’ve lost money. (The rest say they broke even or didn’t answer.) The winners include half of those in Gen Z, who’ve been adult investors for six years at most.

Given the untested nature of today’s new bets, however, it wouldn’t be surprising to see more people eventually ending up in the loss column. Maybe blockchain-based tokens making you an owner of an NBA Top Shot video or a JPG file by digital artist Beeple will continue to rise in value for years to come. Indeed, in the view of those in Gen Z, cryptocurrencies, meme stocks, and non-fungible tokens are surer wagers over the upcoming decades than any other investment.


“I actually believe it is a bubble, to be quite honest,” Mike Winkelmann, which is Beeple’s real name, said in a Planet Money interview. But he added: “When the bubble bursts, it’s not going to wipe out the technology. It’s just going to wipe out the junk.”

Before you swap your bitcoin or GameStop shares for an index fund or annuities, you might also want to think about this: When that financial adviser was shooing people away from cryptocurrencies in 2019, bitcoin was going for $4,000. Today it’s worth $59,900.

Will Johnson is CEO of The Harris Poll.