Informed or not, Millennials prefer bitcoin over stocks. Could it be because “bitcoin” sounds cool and futuristic while “stock” sounds super boring? Studies haven’t officially evaluated my hypothesis, but let’s go with a maybe for now.
Venture capital firm Blockchain Capital’s survey of 2,000 people found that around 30 percent of the participants in the 18-34 age range would rather own $1000 of Bitcoin than $1000 of government stocks or bonds.
Additionally, of those surveyed, 42 percent of millennials were at least marginally familiar with bitcoin, while only 15 percent over age 65 knew of the concept.
On Wednesday bitcoin rose more than six percent to as high as $7,545, pushing the value of the cryptocurrency market over $200 billion for the first time ever. This time last year, bitcoin was worth around $700.
In the past year, cyrptocurrency has risen 600 percent. This is compared to measly gains of 15 percent for the S&P 500 Index. Despite the rise in value, only 2 percent of Americans currently own or have ever owned bitcoin according to Blockchain Capital’s survey.
However, as millennials become more involved in the investment force, this number is sure to increase. If U.S. regulators allow bitcoin ETFs, it may be even easier for new bitcoin buyers to enter the market.
According to Google Trends, more people are searching online for how to buy bitcoin that gold. Can you dive Scrooge McDuck style into a ludicrous pile of bitcoins? Well, no. But you also can’t have the Dothraki give you a melted bitcoin crown, so there’s that safety factor working in bitcoin’s favor.
What else is so appealing about bitcoin? Unlike traditional banks, the bitcoin network isn’t run by a centralized agency and has no physical backing. Instead, it’s run by a network of computers worldwide digitally keeping track of all transactions by storing records in a blockchain.
Since anyone can make an anonymous account, bitcoin gained notoriety a preferred method for drug dealers and ransom payment aficionados. However, the cryptocurrency is also accepted by many major businesses, including Overstock.com and eBay, for legal transactions.
Since there are no transaction or currency conversion fees, people in countries with high inflation can use bitcoin to avoid losing money. Plus, bitcoin makes international money transfers significantly faster than traditional methods.
While bitcoin certainly has proven fruitful for shady transactions, the rising popularity of cryptocurrency for legitimate uses indicates a market shift.