Whether you’ve invested in cryptocurrency, or understand what it is, there’s no denying that over the last year, it has demonstrated staying power. Bitcoin, for instance, as of time of writing, is valued at over $61,000 U.S. dollars per individual Bitcoin, skyrocketing nearly 50% in value from just one month ago.
And while some preconceptions of cryptocurrency investors envisage young and tech savvy individuals, possibly with anti-establishment mindsets, the bigger picture of crypto investors is a little more nuanced than that.
For instance, while crypto wealth is undoubtedly growing, that doesn’t necessarily mean any significant portion of people are quitting their jobs as a result. Eleven percent of the general population reports either having personally quit their jobs, or knowing someone who has, as a result of their crypto investments.
Surprisingly, however, when crossing by income, we see that the larger portion of those quitting their jobs as a result of their crypto investments are those in the lowest income brackets.
This data implies that crypto investments may have provided life-changing levels of income for some, while the wealthier owners of crypto use it more as another form of asset diversification rather than source of income. And further data elaborates this point.
Respondents who are active or occasional traders on the stock market are significantly more likely to have invested in cryptocurrency. So while heavier stock investors may not be quitting their jobs as a result of any crypto gains, they are the ones driving much of the market.
Interestingly, these traders appear to have begun to shift the original purpose and function of cryptocurrency as a whole. At its inception, cryptocurrency, and the blockchain technology behind it, was intended to provide a form of digital currency that was independent of government involvement (protecting it from periodic economic collapse) while also remaining safe, secure, and relatively anonymous (which also made it a haven for some criminal financial activity). But in its current function, it has begun to closely resemble a (highly volatile) stock.
And the data further demonstrates that shift.
A full 28% of the general population expects their crypto investments to act as a long-term growth investment, with almost another quarter (23%) treating crypto as a short-term investment. In other words, over half of the population (51%) views crypto to act, more or less, as a traditional stock.
And these trends, when crossed by age, are the opposite of the way you might expect them to be.
The youngest demographics are much more likely to hold onto crypto as a long-term investment, while those 55 and older show much more financial risk-tolerance with their preference for crypto as a short-term plan.
But is crypto making people wealthier?
Among those who do have crypto investments, nearly 60% of respondents are practically evenly divided as either being wealthier than they were last year, or at the same level of wealth.
But as with everything over the past year, this data may be skewed by the coronavirus pandemic.
Those whose work was relatively unaffected by the pandemic, ultimately report the highest levels of increased wealth over the last year as a result of their crypto investments. Likely, this data implies that wealth, as related to cryptocurrency, may be inherently linked to some level of financial stability prior to investing.
And diving deep into overall income levels further emphasizes this point.
The wealthiest income brackets are much more likely to have gained more wealth as a result of crypto across the pandemic over the last year.
Regardless of wealth gained, however, just barely more than 1 out of 10 crypto investors expect to be wealthier than their parents as a result of their investments.
This positive sentiment is largely driven by Gen Z and young Millennials, as respondents under 34 are more likely to think crypto is a way to surpass the levels of wealth afforded by their parents.
Ultimately, regulations and continued evolutions in fintech instruments will shift how crypto is used and perceived. But as of now, the blockchain technology seems to have shedded off its anti-establishment roots, to be embraced by a diverse set of active stock traders and individuals with various levels of income.
