Investors of all ages seek safer places to put your money, indicating that the rising cost of living is changing attitudes towards risk.
Research by British law firm Michelmores, conducted in the two weeks after the FTX collapse, found that attitudes towards the cryptocurrency gold rush are changing, and many investors are becoming increasingly disillusioned with this asset class. However, a core contingent still sees it with potential.
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Attitudes towards cryptocurrency are mixed among millennials: 23% are investing more than two years ago, but 27% are now investing less due to rising cost of living.
The total percentage of millennial investors holding cryptocurrency holdings it has stayed about the same for the last three years at 21% (20% in 2019), which is in stark contrast to baby boomers, of whom only 4% have money invested in cryptocurrencies.
Unsurprisingly, after the FTX crash, every generation surveyed (Millennials, Gen Xers, and Baby Boomers) is highly unlikely to invest in cryptocurrency in the coming year, preferring traditional forms of investment, such as cash and property.
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All respondents acknowledged the risks of cryptocurrencies, with only 6% saying they would keep investments safer, far behind cash, property, bond and stock funds.
Christian Massey, partner at Michelmores, said: “Cryptocurrency is a volatile asset class and understandably is currently suffering from a weakened level of confidence. The UK is lagging behind when it comes to regulation, which no doubt fuels doubts about crypto as an asset class.“.
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To which he added: “Interestingly, though, the data shows that around a quarter of millennials are investing more than they were two years ago, indicating that, while early adopters may be disappointed, new investors are still showing interest“.
“Above all, the need for a regulatory framework is clear. Cryptocurrency is still in its infancy and to be more than a passing trend, it needs regulatory clarity to boost investor confidence and help it form a significant part of the UK financial services industry well into the future.”, he concluded.
Disclaimer: The information and/or opinions expressed in this article do not necessarily represent the views or editorial line of Cointelegraph. The information presented here should not be taken as financial advice or investment recommendation. All investment and commercial movement involve risks and it is the responsibility of each person to do their due research before making an investment decision.
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