Soaring valuations and volatility may have tarred the Bitcoin cryptocurrency as a bubble in its early years, but its surging value and growing acceptance amongst millennials suggests that the alternative currency could play heavily in the ‘new normal’ as it challenges gold as the world’s de facto basis of monetary wealth.
Fully 47 per cent of respondents said they trust Bitcoin more than the big banks, according to an October Tokenist survey conducted across nearly 5,000 participants in 17 countries.
That was up 29 per cent since 2017, with 45 per cent of millennials saying they would prefer to invest in Bitcoin rather than stocks, real estate and gold.
The figures suggested a high degree of familiarity with Bitcoin, with 14 per cent of millennials saying they have already owned Bitcoin and 44 per cent expecting to buy Bitcoin within the next five years.
Across the board, millennials were more likely than other respondents to appreciate the value of Bitcoin, and more likely to expect that it will soon be in widespread use – with 59 per cent of millennials, compared to 43 per cent of all respondents, suggesting that most people will be using Bitcoin within the next decade.
“Bitcoin is frequently positioned as an alternative store of value,” a Finder Australia analysis noted earlier this year, “similar to gold but with the extra benefits of being a purely digital asset, such as easier storage, the ability to be spent like money and the ability to be quickly and easily transferred anywhere in the world.”
Fully 36 per cent of male millennial respondents said they would prefer to be given $1,000 worth of Bitcoin rather than $1,000 worth of gold – more than twice the rate of the general surveyed group – while Bitcoin was also favoured more than stocks and bonds.
Respondents aged 65 and over were least likely to embrace Bitcoin, with just 3 per cent preferring it over gold and bonds.
“We notice a drop in public confidence towards traditional financial assets like stocks and bonds,” the firm’s analysts noted. “Perhaps compounded by the recent COVID-19 market fluctuations, we see the BTC narrative strongly supported whenever central banks print money.”
A currency for the times
Strong pro-Bitcoin sentiment reflects a growing climate of acceptance amongst conventional financial markets, which have watched Bitcoin’s value surge almost 150 per cent this year and 15 per cent in the first half of November alone.
Despite long-running expectations that the cryptocurrency’s intangible nature and volatility would catch up with it, the currency had reached all-time highs over $27,864 ($US19,800) by the end of November – driving pundits to predict that it is headed for over $70,000 ($US50,000) within years.
Speculation about the pandemic’s effect on Bitcoin’s value has been rife since earlier in the year, when it became clear that the world was in for a major economic hit that could increase the volatility of traditional currency structures.
The US dollar is at its lowest levels in more than two years, with some experts predicting its collapse in 2021 and one recent survey of fund managers finding that a third believe shorting the US dollar had become a top currency strategy.
“In these cases, people traditionally turn to assets like gold,” the Finder analysis noted, “which act as an alternative store of value, theoretically able to retain worth even if the value of fiat currency declines.”