Report: Millennials' poor financial situation drives cryptocurrency adoption

Millennials in the U.S. are flocking to alternative funding methods, such as crypto assets, to boost their finances, data shows.

A Morning Consult report in January titled "The State of Consumer Banking and Payments" found that millennials are adopting new technologies to help them make financial decisions at a higher rate than any other generation. Financial services analyst Charlotte Principato, author of the report, combined data from 50,000 different respondents with monthly surveys conducted in the U.S. and globally from July to December 2021.

In emailed comments to Cointelegraph, Principato said that the increase in cryptocurrency use in 2021 was an outlier in the statistics that she came across while writing the report. she says:

"While cryptocurrencies are a volatile asset, they have managed to attract and continue to grow interest from consumers around the world."

About 48 percent of millennial households owned cryptocurrencies as of December, up from about 30 percent in June. During the same period, 20% of all U.S. adults reported owning cryptocurrencies.

Source: Morning Consult

Millennials' use of alternative financial services, such as cryptocurrencies, may be due to their financial well-being being "below the national average" since June 2021, the report said. As of December, the global average was 50.98, but the millennial group hovered around 49.54.

In an interview with Cointelegraph, Principato said she has noticed a downward trend in finances over the past seven months. She attributes the decline to "Delta and Omicron variants, as well as rising inflation in the U.S. that has not fully recovered."

According to Morning Consult's website, the financial well-being index is determined by a scale that "includes 10 questions to measure present and future security and freedom of choice in relation to consumers' control over their finances, their ability to absorb financial shocks capabilities and their trajectories to achieve their financial goals”.

Source: Morning Consult

While millennials dominate overall, cryptocurrency owners are "disproportionately high-income millennial males." 70% of millennial men use cryptocurrencies, and 25% of them make more than $100,000 a year.

Interestingly, Hispanics use cryptocurrencies at a higher rate than their average U.S. adult population. About 16% of all U.S. adults are Hispanic, yet they make up 24% of all cryptocurrency owners.

Source: Morning Consult

As cryptocurrencies become more mainstream in 2021, respondents from Baby Boomers, Generation X, Millennials, and Generation Z adults are increasingly likely to consider buying cryptocurrencies from U.S. exchange Coinbase.

The results of the report led Principato to conclude that “Cryptocurrencies will boom in 2022.” The report said that the adoption of cryptocurrencies and the participation of the younger generation will be the two main factors that will lead to this boom.

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