Crypto Investments: The Benefit and Draw for Every Generation

In a relatively short span of time, cryptocurrency has burst onto the investment scene, with people of all ages and backgrounds testing the waters. About to celebrate its first decade as an alternate form of currency, crypto has gained an impressive following and an increasing market share as an investment.

For those unfamiliar with its rise, cryptocurrency first arose in 2009 in the form of Bitcoin, a decentralized peer-to-peer digital currency with no central bank. The idea was not new, but the technology behind it, blockchain, was. The blockchain is an ever-expanding public ledger that uses cryptography to record transactions through a peer-to-peer network adhering to a strict protocol of communication and validation. Any new transaction – buying, selling, or trading crypto – must be approved by all members of the chain before becoming permanent.

Blockchain technology is appealing to many long-term investors for its potential use in other applications, such as medical records, supply chains, and international bank transfers. What we’re seeing now is just the tip of the iceberg. As more and more companies adapt to the blockchain, crypto companies that use it best will rise in value.

It’s easy to misinterpret cryptocurrency as a younger person’s game. The technology and concept behind it are not the easiest to understand, but the same could be said for dot-com companies in the 1990s, or even the likes of Apple and IBM when personal computers arose in the late 1970s and early 1980s. While millennials do hold a lot of cryptocurrency – one survey pegs 39% of its holders to be between 25-34 years old – there are ample opportunities for Generation X and Baby Boomers to invest in crypto for their own goals and come away the better for it.

What are the motivations for each generation to invest in cryptocurrency and how many are doing it? Let’s take a deeper dive into each age group and their investment portfolio.


 Cryptocurrency, in many ways, is scratching millennials right where they itch. The generation of Americans who have grown up with the Internet and smartphones as part of their lives from a young age is the most adept at understanding and trusting the technology sector. Cryptocurrency and blockchain are both at the forefront of that digital wave.  A survey of cryptocurrency investors released in March 2018 found 22.7% of cryptocurrency holders to be in their 20s and an additional 19.3% in their 30s.

Millennials also have a healthy distrust of big banks. When the mortgage crisis of 2007-2010 occurred in the US, most millennials were in their teens or early 20s, highly impressionable times for a person to form opinions about the country’s institutions. That same crisis likely dampened many millennials’ interest in investing in the stock market. The Great Recession shredded the retirement funds and 401(k) plans of many a millennial’s parents. The challenge of investing in cryptocurrency for millennials resides in their availability of funds to invest.

Generation Xers

 Generation X has the unfortunate claim of having the most credit card debt out of the three targeted demographics. Paying off lots of debt means less money to invest for the short-term or long-term. A recent survey found that 40% of Gen Xers don’t know how they’re paying for retirement. With 15-20 years of work already in the rearview mirror, Generation Xers find themselves needing to hustle to make up for lost time and get their IRAs up to snuff. Cryptocurrency can be a great way to catch up in a hurry if the right investments are made at the right time. Bitcoin was priced right around $1,000 at the beginning of 2017 and is now above $8,000. Had a Gen Xer invested $5,000 during that early period, they would now have an additional $40,000. Even better, they can use self-directed IRAs to put crypto into a retirement account. Self-directed IRAs work just like regular ones, except that you are the director of the funds, not an investment firm. Anything from traditional stocks and bonds to precious metals to crypto to property can be placed in a self-directed IRA.

The key for Generation Xers, who by now are settled into the traditional family model of spouses, kids, minivans, and mortgage payments, is finding long-term investment opportunities that will consistently increase in value. This takes lots of research and smart decision-making, avoiding the knee-jerk reactions of abiding by market hype and instead sticking to a long-term plan that works.

Baby Boomers

Baby Boomers were hit the hardest by the Great Recession, with an average of 25% loss from the retirement accounts of those who had been on the job for 20 years. Many Boomers have spent the 10 years since taking more chances in an attempt to regain all those losses to reach retirement age with the finances they had been planning for previous to the recession. Trust is a big negative for Boomers with crypto. There’s no safety net, buying it isn’t that easy, and there aren’t many ways to spend it that appeal to them, other than buying other cryptocurrencies. One survey finds that less than 7% of crypto buyers are over the age of 55.

Another barrier for Boomers is the foreign concept of cryptocurrency. It’s tough to invest dollars in something that you don’t understand. But the same could have been said about the rise of the digital superpowers like Amazon and Google. Companies with sound business plans are worth taking a look into, regardless of what they actually do. Many Boomers now understand that, had they taken the time to learn about and invest in the successful dot-com companies when they were yet on the rise, the effort would have reaped dividends.

Likewise, today, the underlying technology of blockchain is equally promising, though it’s uncertain as of now which exact cryptocurrencies will be the ones widely adopted. But winners in crypto will emerge, and those investors who understand the industry could also profit from its innovation.

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