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- A recent survey has revealed that Gen Z is increasingly favoring cryptocurrency over traditional retirement plans like 401(k)s.
- Despite 83% of investors aware of cryptocurrency considering it a risky investment, a growing number of people are choosing to allocate funds to digital assets.
A new study by Todd Dupeyan, senior vice president of market research at YouGov, analyzed over 10,000 YouGov panel surveys conducted throughout 2024, revealing a stark generational divide in investment preferences among U.S. investors. The findings highlight that Generation Z is nearly four times more likely to invest in cryptocurrency, with 42% holding digital assets compared to just 11% investing in traditional retirement accounts.
This trend highlights a shift in how young investors approach wealth-building, favoring high-growth, digital-first investment opportunities over traditional long-term savings strategies. While 49.9% of Gen Z investors are considering investing in cryptocurrency, its growth score remains relatively low at +7.0. This suggests that although crypto remains a popular choice, young investors may be increasingly looking to diversify into other asset classes.
The study analyzed customer satisfaction across 23 major investment brands, including Fidelity, BlackRock iShares, JPMorgan Chase, Charles Schwab, and Goldman Sachs. The data reveals that while Millennials are leaning toward cryptocurrency, with 36% investing in it compared to 34% in retirement accounts, older generations like Gen X and Baby Boomers continue to prioritize traditional investment options such as 401(k)s, stocks, and savings accounts.
The Riskiest Yet Most Popular Investment Choice
Despite its growing popularity among younger investors, 83% of those aware of cryptocurrency consider it a risky investment, making it the riskiest asset class by a significant margin. Other high-risk investments include options and futures, stocks, collectibles, and commodities, reflecting broader concerns about market volatility and unpredictability.
In contrast, only 6% of investors view certificates of deposit (CDs) as risky, reinforcing their status as a safe and stable investment option compared to more speculative assets. It is worth noting that Gen Z investors are increasingly turning to cryptocurrency exchanges, with 48% using them as their primary investment platform, highlighting their preference for digital assets and decentralized finance. Online investment platforms 14%, retirement accounts and ETFs 13%, and real estate platforms 10% also see some engagement, though at lower levels.
Notably, only 9% of Gen Z investors do not use any of these investment channels, indicating a segment that remains disengaged from traditional and digital financial markets. These trends suggest that Gen Z prioritizes accessibility, flexibility, and high-growth potential over the long-term stability traditionally associated with retirement accounts.
Why Are GenZ Turning to Crypto?
Many young investors distrust traditional finance, viewing the banking system as outdated, slow, and designed to favor institutions over individuals. Instead of relying on 401(k) plans, which require decades of contributions and compounding growth, Gen Z is drawn to cryptocurrency’s potential for massive, short-term gains.
Social media platforms like TikTok, X, and Reddit have further fueled this trend, shaping financial outlooks and encouraging riskier investment strategies. Additionally, economic uncertainty, driven by rising inflation, student loan debt, and job instability, has made Genz skeptical of traditional retirement savings, pushing them toward alternative investment opportunities.
A key factor driving this trend is the pro-crypto stance of President Donald Trump. Since his 2024 campaigns, he has embraced innovation in the digital asset space, advocating for clearer regulations that could provide a more stable and accessible investment landscape. His position has further legitimized crypto in the eyes of many investors, accelerating its adoption among younger generations.
