HomeCryptoBank of America: young people hold more crypto

Bank of America: young people hold more crypto

Bank of America Corporation (abbreviated as BofA) is a US multinational bank and financial services company. Bank of America was formed through the acquisition of BankAmerica by NationsBank in 1998. It is the second largest banking institution in the United States, after JP Morgan Chase. 

Bank of America found that younger, wealthier Americans are 7.5 times more likely to hold cryptocurrencies in their portfolios than investors age 43 and older, projected to invest in stocks or more traditional bond packages. 

The bank reported:

“If the youngest and wealthiest part of the country lacks confidence in stocks, where do they see opportunities for investment growth? In alternatives, including cryptocurrencies, which are their No. 1 choice.”

Young wealthy Americans prefer crypto to stocks

Bank of America released its 2022 Private Bank Study on Wealthy Americans this week. The report highlights the results of an online survey, conducted from May to June, of 1,052 people over the age of 21 with household investable assets of more than $3 million

The bank noted that the respondents are a nationally representative sample of the high-net-worth US population and not necessarily Bank of America clients.

Conventional investment advice suggests that younger investors hold more stocks, not less, than older investors. Yet the 21 to 42 age group holds only a quarter of their portfolio in stocks, compared to 55% of investors aged 43 and older, the report shows:

bank of america crypto

If the youngest and wealthiest part of the country lacks confidence in stocks, where do they see opportunities for investment growth? Alternatives, including cryptocurrencies, which are their No. 1 choice.

While 29% of the younger group said that cryptocurrencies represent an important opportunity to create wealth, only 7% of the older group agreed. 

The younger group is generally more interested in private equity and investments that are sustainable or related to the environment, society and governance (ESG), the report shows.

BofA thus highlighted that it is young people who are prone to cryptocurrency investments, certainly because they are the generation closest to social networks, forums, or financial apps such as Reddit or Degiro and Binance.

In fact, the survey found that half of the younger group said they use social media for insights into cryptocurrencies, compared to 30% of the older group.

Although the number of investments is then concretely low, it was calculated that young people are up to 7.5 times more likely to hold cryptocurrencies in their portfolios and five times more likely to understand the world of crypto investing.

Katy Knox, President of The Private Bank at Bank of America, said: 

“Wealth planning is inherently multi-generational. As we see among our client families, financial behaviors and values take shape early in life and live on in the legacies passed from one generation to the next. These research findings point to a larger role wealth advisors and the financial services industry is playing in helping families transition wealth and meet the needs of the next generation.”

In the report titled “2022 Bank of America Private Bank Study of Wealthy Americans,” the bank noted that the shift of $84 trillion in personal wealth, which is expected to move primarily from baby boomers to Generation X and millennials through 2045, could have a major impact on future families, wealth managers, charities and financial markets.

Alessandra Bonifacio
Alessandra Bonifacio
Graduated in modern literature, she is interested in communication and digital humanities after taking part in a research project in collaboration with Stanford University and in a summer school in digital marketing at the IE Business School.
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