As bitcoin and other cryptocurrencies remain volatile, investor anxiety is high – but how high depends on your income and age.
A survey by Environics revealed that younger Canadian investors are more confident in cryptocurrency. 40 per cent of the 1,000 surveyed who identified cryptocurrencies as ‘high return investments’ were from the 18-34 age bracket.
With an increasing number of women entering the crypto space, Canadian women were found to be willing to take higher risks. 71 per cent of the men surveyed said risk was a major concern in comparison to only 55 per cent of female respondents.
42 per cent of respondents identified the high cost of fees associated with investing as a major concern. There are free trading options, such as Coinberry or Cobinhood, but some have a limit on the number of free transactions by Canadians.
“It is a new industry and technology that people are wrapping their heads around, so building trust is crucial,” says Andrei Poliakov, President of Coinberry, which aims to attract investors by offering no-fee trades. “We want to enable Canadians of all ages to invest to understand the technology and opportunity of cryptocurrency.”
Of many factors that may hinder new investors, high income earners (those who make more than $100,000) cite risk, lack of understanding as well as security as major pain points in cryptocurrency investing.
“It was very confusing and frustrating to me as a new investor, bitesize visual material would have helped,” says Maggie Xu, a millennial cryptocurrency investor. “Spending a few minutes reading about it everyday can help clear up the confusion and mystery around cryptocurrency.”
While older investors may fear the present state of cryptocurrency, some are investing in the philosophy of transparency and its longterm promise and potential.
“It is just a much better money system. I like the idea of sound money, decentralized control and the peer to peer system,” says 46-year-old cryptocurrency investor Elio Di Iorio. “I expect to be economically active well beyond my retirement age and see cryptocurrency as being the standard form of money and value exchange by then. It’s very immature right now, kind of like the internet in the 90’s. Crypto is the currency of the future.”
While Gen-X investors are investing in the future of cryptocurrency and believe that the prime years for crypto is yet to come, Millennials say that the disruption has already begun.
“Canada is really stepping up in terms of tech development and with the number of tech jobs in Toronto surpassing Silicon Valley, it is an exciting time to be an investor in Toronto right now,” says Xu.
Another factor that is attracting younger investors is the transparency of the industry.
“The ‘we are here, very open and ask us anything’ attitude is a really good trend to see,” says Xu. Older investors are attracted to the ‘low maintenance’ aspect of the investment.
For rate of return, both Millennial and older investors see it as a longterm investment. 39 per cent of all 18-34 year olds surveyed recognized cryptocurrencies as high-return investments.
With younger investors staying loyal to cryptocurrency despite its unpredictability, this finance fad is here to stay and investors are in it for the long run.