Bitcoin, just like esports, social media, streaming services, and so many other digital ventures, has always been a drastically divisive concept when it comes to different generations. Being that BTC tokens are in essence a direct product of the revolutionary blockchain technology, the level of tech understanding is beneficial in any approach to it. Even those who decided to stay away from any form of crypto investment did so from a better position if they had a clear grasp of how the same technology functions in the underlying network mechanics. Because of that, there was always a sense that only the younger individuals have that predisposition for technology to become more numerous adopters. The numbers of digital wallets also showcase the same trend, with most of these behind operating – if they have private citizens as their users – by individuals who are well below 50 years of age.
However, some recent data, as well as the takes from one of the legendary crypto investors, show that this trend might change soon enough. It signals the rising interest of the Baby Boomer generation in cryptocurrencies, as well as the potential of these individuals, either directly or through third parties, entering the crypto market. Even though it seems trivial, the impact of such an occurrence would have enormous value, literally and metaphorically, to the prices of cryptocurrencies, especially in the already dynamic and bullish present year.
Mike Novogratz Outlook
Affluent members of the Baby Boomer generation could be the next big age cohort that will take a leap into cryptocurrencies. This will take place as the same digital tokens become more and more mainstream, or at least that is what Mike Novogratz, a billionaire investor and founder of Galaxy Digital, a crypto firm, believes. Previously, Novogratz made his name as the head of the investment company Fortress and the brain behind many successful hedge fund initiatives. Now, in an interview at Reuters, he explained why he thinks there is a strong possibility that nearly a trillion USD could come from this generational group in the coming years.
Here, the mainstream institutions will also play a big role, as more of them begin to offer cryptocurrency products to their rich users. Under the right circumstances, their pitch to their Boomer clients could trigger an avalanche of people jumping on the crypto train. With the speed-up of that process, test sums could gradually turn into hundreds of millions of USD that the Boomers will invest in different cryptocurrency networks. In that scenario, bitcoin would once again lead the pack in terms of token price and overall market capitalization.
In the previous weeks, the fact that many companies are actively and openly investing in cryptocurrencies grabbed the global financial headlines. These companies include international heavy-hitters like Square, MicroStrategy, and the most famous one in the bunch, Tesla Motors. That is also a big sign to all Boomers who are already deeply invested in traditional financial markets. These investments are both material and conceptual, as the same individuals regularly spend hours examining the stock patterns and the potential for the same publicly traded ventures.
Now, crypto could enter that framework of investment, especially because financial institutions are also taking on crypto. So, for example, Morgan Stanley became the first major US bank to provide its affluent clients with different bitcoin funds. The money will begin flowing to these crypto-enabled entities during the first weeks of April. These include Novogratz’s Galaxy Digital as well. That type of move from banks and hedge funds will also make headways in the investment environment of the older generations.
Baby Boomer Mentality
In the mainstream media, the term Baby Boomers is often referenced. However, the cultural and recent economic significance is rarely discussed in detail or through the lens of their present-day financial standing. These include are presently mainly people in retirement or close to it. Because the generation represents those born between the end of World War Two and 1965, even the youngest of them are presently around 60 years. They were brought up in the best economic circumstances the US saw in the 20th century. They also secured relatively high-paying jobs in the market afterward and got additional financial benefits when they least expected it.
That was in the wake of the 2008-9 global financial crisis. Back then, this generation saw the most money being pumped into their pockets and their businesses from the huge stimulus programs. That allowed them to both enter that financial crisis in good standing and exist in a decent shape, unlike for example many Millenials who only began their careers around the big crash. Presently, they are also getting money from the stimulus programs around the covid-19 coronavirus pandemic and seeing their spending go down as most own their homes. This makes them a generation that is holding a lot of money presently and is not shy about spending it on financial packages of all types.
The present macroeconomic situation in the US is shifting where many predicted it would – into inflation territory. The stimulus checks and the announced expansion of the physical infrastructure of the country that President Biden showcased all mean a lot more spending is to come. The same spending will kickstart the economy, but also drive down the value of the USD as cash floods into the system. While Baby Boomers might be hesitant about adopting new technology, the idea of protecting some of their savings from that inflation onslaught will be instantly understandable to almost any of them.
This is the ultimate reason why so many of them could enter the crypto market in the coming period. If the US continues to print money like it is doing right now, the value of the national currency will continue to slide. Moving even a small part of personal savings into crypto as a form of a novel hedge makes perfect sense. Yet, the same total sum of money could easily reach many billions of USD if the trend catches on among the more affluent Boomers.