Giant social trading platform, eToro has released the results of its market survey - which shows that over 40% of “millennial online traders” appear to have “less faith” in the performance of the traditional stock market - when compared to the digital asset market.
Significantly, 71% of millennials (born between 1981 and 1996) responding to eToro’s survey said they “would invest in crypto if it was offered by traditional financial institutions.” Other notable results from the trading firm’s poll included “half of online investors expressing interest in a crypto allocation in their 401k plans.” In the US, a 401(k) is a retirement savings plan that is “sponsored by an employer.” The plan “lets workers save and invest a piece of their paycheck before taxes are taken out.”
As explained in eToro’s press release, the company’s “nationwide survey of 1,000 online traders” revealed that 77% of Generation X respondents (those born between early-to-mid 1960s and early 1980s) “trust stock exchanges more” than cryptoasset-related investments or other alternative/emerging markets.
Losing Trust In Traditional Financial System
Commenting on the results of the survey, Guy Hirsch, eToro’s managing director, remarked:
We're seeing the beginning of a generational shift in trust from traditional stock exchanges to crypto exchanges. At the heart of this change are the asset classes themselves. Younger investors' experience with the stock market has seen a great deal of loss of trust, with the fall of Lehman Brothers because of irresponsible practices followed by the worst recession since the Great Depression.
Hirsch, a former director of innovation strategy at Samsung SDS, added that Americans also began to lose trust in the traditional financial system when they saw “their savings evaporate” - as banks received “free money through quantitative easing while their cost of living continued to rise.”
Going on to express confidence in the “immutability” feature of blockchains, Hirsch explained that distributed ledger technology (DLT)-based systems allow firms to conduct “real-time auditing” in a “cost-effective” manner. According to Hirsch, this is “why millennial and generation x” believe digital asset exchanges are “less likely to be subject to manipulation and less likely to be a place where bad actors get rewarded with taxpayer money.”
Other findings from eToro’s survey suggested that younger investors trusted crypto investments more than traditional stocks. Notably, eToro’s nationwide poll of US-based investors found that “even among millennials that [said they] don't trade crypto, one-third said they would trust crypto over the stock market.”
Over 90% Of Milllennial Traders Would Invest In Crypto If Offered By Large Institutions
Most, or 93%, of millennial crypto traders responding to eToro’s survey said “they would invest more money in [digital assets] if [they] were offered by traditional financial institutions such as TD Ameritrade, Fidelity, or Charles Schwab.” Approximately 70% of millennials participating in eToro’s poll that were not trading crypto said they would start if more institutions began providing the option to invest in digital assets.
Nearly 60% of investors from all age groups that took part in eToro’s survey said “they would invest more money in crypto if it were offered by a traditional financial institution.”