For the past few months, you’ve probably heard people talk about how Generation Z hates crypto.
Survey after survey after survey shows America’s youngest generation is largely apathetic, if not downright hostile to cryptocurrency.
Combined with well-known crypto-hatred from baby boomers and Generation X, you may think this proves cryptocurrency is a largely millennial thing that will die. Older generations ignore it and younger generations avoid it. How could it possibly succeed?
We shall see, won’t we?
While we wait, I wish to offer a contrary view. Or at least, a little perspective.
(BTW Gen Z, my intent is not to offend you but my blogger persona tends to speak directly, without nuance, often in simple terms.)
Too young to care
Generation Z covers people in the U.S. who were born after 1998 (or 1996, depending on who you ask). Assuming we take the largest range, you’re talking about people under the age 21 or 23, with the vast majority of them younger than 18.
Most of these people are too young to open a bank account, though some may have one under their parents’ names. Many have little experience with any financial system. Of those that have their own money, most use peer-to-peer payment apps instead of checks, online bill pay, or wire transfers (though multiple surveys show credit/debit cards still dominate).
Only the very oldest members of this generation have ever bought a drink legally. The vast majority have not even finished puberty.
Those that have full-time jobs generally earn low wages (because they’re young). Of those that do not have full-time jobs, most are either in school or too young to work.
Why would they care about cryptocurrency?
Many have never dealt with the banking system. Few have ever run a business. None have held middle-management or executive positions in a large company or government agency.
Do they have enough perspective about traditional systems to understand why cryptocurrency matters?
When they say they want nothing to do with cryptocurrency now, does that mean they will always feel that way?
Maybe, of course.
It’s also possible they’ll change their minds as they start adulting.
Nobody can hide from bitcoin mania
While some of the older members of Generation Z saw the bitcoin boom of 2017, most missed it. They’ve only known a cryptocurrency bear market.
In that regard, I suspect they see it like I saw the dot-com bust: something that screwed older people and didn’t have any significance to my young life.
From their perspective, bitcoin is a rollercoaster ride that always crashes. Who wants to jump on that ride?
You can understand why they’d feel skittish about throwing a few bucks into bitcoin. Especially when they have the highest percentage of savers and strongest aversion to debt among U.S. generations.
Yet, paradoxically, they admit they’re heavily influenced by social media and bad at managing money.
What do you think will happen if we see bitcoin go back to $20,000? Or maybe even that $100,000 price everybody calls for? When Twitch, YouTube, Twitter, and Instagram blow up with people buying lambos?
If that happens, will these kids will resist the natural urge to join the bandwagon? If not, what makes them so different from all the generations of humans who came before them?
Lots of Gen Z-ers love crypto
When Business Insider reported a survey showing more than 70 percent of 13- to 21-year-old kids have no desire to buy cryptocurrency, it neglected one fact from the same survey:
Almost 30 percent of them plan to buy cryptocurrency in the next six months.
How will they buy crypto? I don’t know, because most of these kids are too young to open an account with any exchange. When you survey 13- to 21-year olds, you need to take results with a grain of salt.
Setting that aside, let’s assume Generation Z has 61 million people, as CNBC reports. If BI‘s survey is legit, we can expect roughly 18 million of those kids to buy cryptocurrency.
Considering the U.S. has only 22-30 million total cryptocurrency accounts (depending on the source), that’s a huge batch of new buyers. Especially when you consider some of those accounts already belong to Generation Z.
Some sources say Gen-Z has 82 million people. If that’s true, Gen Z by itself will double the number of people who hold cryptocurrency in the U.S.
How much will these kids buy?
Probably not much.
Financial reports estimate Gen-Z has up to $143 billion in purchasing power and other sources say Gen Z makes $463 billion in wages, income, and business profits.
That’s not a lot of money for a $20 trillion U.S. economy.
It is a lot of money for the $250 billion cryptocurrency market.
A little of that money will go into cryptocurrency. When you consider the tiny size of this asset class, a little goes a long way.
On top that, Gen Z’s purchasing power should grow as more of them get jobs, start careers, and earn more money. Those 30 percent will probably put a little of that new money into bitcoin, too (hopefully alongside their retirement account…or maybe as part of it?)
Time is on their side
Because Gen Z is so young, it has an advantage over every other generation:
It has no place to go but up.
Over the next few years, more and more of this generation will enter the workforce, earn money, and start new businesses.
Most of them won’t have kids to feed, a retirement they’re worried about, or parents to support. Assuming they’re not crushed by rent, student debt, and healthcare costs, they will have money to spare for crypto.
If bitcoin keeps going up, some of them will tell their friends, leading their friends to buy some. They may even convince nay-sayers to switch sides. It’s happened before.
Almost one-third of them have already admitted to strangers that they plan to buy cryptocurrency.
New money. Fresh enthusiasm.
Also consider they will also be the first generation that has actual, real-life implementations of cryptocurrency for actual, real-life activities. They will grow up with big businesses like JP Morgan, Ernst & Young, MetLife, IBM, Microsoft, and Square using cryptocurrency as part of their products and services.
On top of that, they’ll see lots of smaller blockchain businesses rise to prominence. They’ll use gaming platforms, payment apps, and social media networks built on cryptocurrency.
For them, it will all seem as unusual Netflix, VR headsets, eSports, public scooters, and ride-sharing.
In other words, normal.
Not the millennial experience (hopefully)
Unlike my generation, Z does not have to pay for two wars, a global financial catastrophe, and a massive public bail-out of the financial sector.
They aren’t coming of age during the worst economy in a century or seeing their first homes get foreclosed on.
They don’t have parents they can’t support and medical bills they can’t afford.
At least, hopefully not.
As a result, maybe they really don’t see value in cryptocurrency.
They don’t have to. Millions of them already buy it. All of them will use it eventually.
We will give them that future. They just need to accept it.
If 30 percent of them already do, is it really that much longer before the rest of them follow?
Mark Helfman is a cryptocurrency commentator and author of Consensusland, a Readers’ Favorite 5-star book about a country that runs on cryptocurrency. You can also catch him on Medium.