Gen Z are four times more likely to own cryptocurrency assets than a traditional 401(K) account, a new study has found.
Crypto is now the most popular investment for Americans born between 1997 and 2012, a recent report by YouGov found.
The study found that 42 percent of Gen Z investors owned crypto but only 11 percent had a retirement account.
Millennials also fit the trend, with 36 percent owning crypto assets, while 34 percent reported having a 401(K).
The increased popularity of crypto assets is part of a ‘second wave’ of interest in the asset, according to Todd Dupey, senior vice president of market research at YouGov.
Dupey said that although crypto was once seen as the ‘wild west’ of the investment world, increased guards against fraud have helped to bring it into the mainstream.
‘Even larger banks and larger fintech companies are open to having [crypto] as a part of your portfolio,’ he told Money.
Crypto has flourished in recent months, with Bitcoin hitting a new record high of $100,000, as the Trump administration has signaled its intent to relax regulations around the asset class.
Gen Z are four times more likely to own cryptocurrency assets than a traditional 401(k) account
Investing in crypto has become more accessible with the rise of retail investment apps such as Robinhood and Coinbase.
Financial planners are more likely to advice taking advantage of a 401(K) and establishing an emergency fund before using any extra to dabble in risky crypto investments.
However, financial planner Dinon Hughes told Money they understand why Gen Z are more drawn to the latter.
‘The majority of Gen Z is still trying to figure things out,’ Hughes told the publication.
Hughes explained that many younger investors are in entry level jobs and may not have access to a 401(K).
‘With that foundation, which do you think a 20-something person is more likely to do on their own, open an IRA or make a couple quick bucks off crypto?’
Bitcoin recently hit a new record high of $100,000
The difference between crypto investing and a traditional 401(K) account may be less distinct than previously thought as the risky assets are increasingly creeping in to the retirement savings of ordinary Americans.
Many workplace retirement plans with well-known companies such as Vanguard, Fidelity, BlackRock and Morgan Stanley, are investing in a company called MicroStrategy.
MicroStrategy is an American development company, and is a holding in many traditional retirement stock portfolios, according to The New York Times.
While Americans are responsible for choosing where their 401(K) is invested, they are often unaware of the exact details of the funds they hold in their account.
MicroStrategy started as a provider of business software, but has pivoted to focus on buying Bitcoin.
The company has made a more than 3,000 percent gain since August 2020, according to the outlet.
But it also suffered a catastrophic year in 2022, losing more than 74 percent, as did many companies focusing on cryptocurrency due to the collapse of the FTX exchange run by Sam Bankman-Fried.