Cryptocurrencies have a great appeal to young people.
Research by Nibud and Rabobank showed last week that more than a quarter of young people between the ages of eighteen and thirty have cryptos.
Where does that need come from and what about the risks?
In total, 42 percent of young people invest.
A third (31 percent) do so in stocks, bonds and funds, 27 percent have cryptos and 10 percent only invest in digital currencies and have no traditional stocks.
It comes as no surprise to Bert Slagter, bitcoin expert and one of the authors of the book
Our money is broken,
that so many young people invest
"There's a bigger story behind that," he says.
An important factor here is inflation, which rose to 5.6 percent in November, he explains.
"It is often stated that this is the highest level since the 1990s. But if you look at the savings interest at the time, it was more than 8 percent. That compensated for inflation."
"With a savings interest rate of 0 percent, the purchasing power of savings halves in about twelve years. That means that saving no longer works," says Slagter.
"If you want to preserve your wealth, you are forced to invest."
“Young people are used to the digital world, that you can immediately send and transfer something.”
Bert Slagter, bitcoin expert
Investing in cryptocurrencies
The fact that cryptocurrencies are particularly attractive to young people can also be explained, says Slagter.
"Young people are used to the digital world, that you can immediately send and transfer something. Digital possession is much more natural for them than for the older generation."
But as established as stocks are, cryptocurrencies are still as new and unregulated.
And that is also a cause for concern, says Ariane Kleijwegt of the government platform Money Wise.
"There is a big difference with stocks and bonds. There is nothing under this at all, no underlying value. You do not own a piece of a company, as is the case with shares."
"At the same time, the attraction is great. Young people are talking about it. There are many influencers, called finfluencers, on social media, which can also be behind shady companies," says Kleijwegt.
"In addition, the legal protection of consumers with cryptos has not yet been properly arranged. For example, there is no licensing requirement for crypto providers, which means that it is often unclear to consumers what kind of party they are going to work with."
Risks with cryptocurrencies
Butcher admits that.
"I think you should at least distinguish bitcoin from the rest. That is a category in itself. If banks develop an infrastructure for cryptocurrencies, it is always for bitcoin," says Slagter.
A second digital currency, ethereum, may be moving into this category, according to Slagter.
But all the other coins?
That's quite a risk.
"I liken it to start-ups. Bitcoin is like the Internet, a network of value transfer. But all the other currencies can be seen as start-ups in Silicon Valley in the 1990s. A few have grown very large, but the majority does not exist anymore."
In addition to 'trials and experiments', there is also a lot of fraud with digital coins.
For example, last month it turned out that the new cryptocurrency Squid Game was counterfeit.
The creators of the coin based on the popular Netflix series
ran off with 2 million dollars (more than 1.7 million euros).
“People spend five evenings on Kieskeurig.nl, so to speak, to compare kettles, but with cryptos everyone immediately turns to them.”
Bert Slagter, bitcoin expert
Not chasing the hype
Slagter therefore recommends that you always do good research.
"People spend five evenings on Kieskeurig.nl to compare kettles, but everyone immediately turns up with cryptos. Then you are vulnerable to wrong coins."
Plus, he says, running after the hype also puts you at risk of being the "sucker who buys last" right before the coin hits its peak.
"It makes people greedy and eager, but realize that most of them lose everything. You only belong to the people who do succeed."
At the moment, the crypto market is not yet regulated for consumers, but work is being done on this at European level, among other things.
The Netherlands Authority for the Financial Markets (AFM) can then take stricter action when, for example, advertising.
"Then the wild west will become a bit more civilized," says Slagter.
Money you can miss
According to Slagter, it is positive that more than three quarters (77 percent) of young people believe that you should only invest with money that you can spare.
In addition, 86 percent of the respondents also have savings on hand.
"It is logical that you look for returns. Most do so in a responsible manner."
Kleijwegt also advises young people to maintain a buffer.
"In any case, you should not speculate with money that you cannot afford to lose. Be very aware of the risks. There is no legal safety net like the deposit guarantee system for money in the bank, as is the case with investing. depends entirely on supply and demand, causing the value of bitcoin and other cryptos to fluctuate widely.”
Money Wise will start giving guest lectures at schools about bitcoins from next year, says Kleijwegt.
"We think it is important that cryptocurrencies and its risks are given more attention in education."
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