Cryptocurrencies are making their way into more retiree portfolios

Cryptocurrency begins to find interest among retirees…

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Despite the inherent volatility of cryptocurrencies, a report has found more people of retirement age are delving into the space.

The findings were shared in the inaugural annual BTC Markets Investor Report. This report is aimed at providing insights into the behaviour of Australian cryptocurrency investors in FY2021.

Interestingly, the data points to an increased interest in the likes of Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH) among people 60 years of age and older.

This challenges the stereotype that the sole demographic of crypto investors is young males.

Cryptocurrency as an alternative asset

As Bitcoin and other cryptocurrencies surpass more than 10 years of existence, previous naysayers are beginning to open up to the idea of investing. Generally, it had been younger people who served as early adopters of blockchain-based investments. However, BTC Markets’ recent report suggests older demographics are making a foray into the world of crypto.

While people between the age of 25 and 43 years old still make up the majority of users of the BTC Markets exchange at 69%, those above the age of 60 are growing at a substantial rate. According to the report, this demographic of crypto exchange users increased 15% year-over-year. In fact, the rate of growth outpaced the increase in users between 25 and 43 years of age.

The data indicated that the demographic is trading less frequently than its younger peers. However, these more senior investors are dishing out a greater amount of dosh into their digital investments.

For example, the 25 to 43-year-old age group on average traded 6 times daily compared to the over 65’s 4 times. Though the older group poured in more than twice as much money on average than their younger peers, at $4,349 compared to $3,263.

BTC Markets justifies the discrepancy in investment amount by stating, “As baby boomers, they [the over 65-years-old demographic] have accumulated assets and disposable income, so are not worried about allocating a percentage of their portfolios to cryptocurrencies.”

Commenting on these findings, BTC Markets CEO Caroline Bowler said:

Australians aged over 60 are seriously developing investment strategies for their post-work years as they approach retirement. A low interest rate environment is a key factor behind them seeking investment opportunities in alternative assets like cryptocurrency.

Creeping into SMSFs

Another indication that the speculative asset is making inroads with more investors, BTC Markets reported a large surge in the number of self-managed super funds (SMSFs) using the platform. The cryptocurrency exchange reported a 95% increase in users operating under an SMSF in FY21.

Additionally, these retirement funds also upped the ante in the amount being invested. Reportedly, the exchange witnessed a 145% increase in the average portfolio size year-over-year.

Given this, BTC Markets suggests that people are holding a long-term bullish sentiment towards cryptocurrencies such as Bitcoin and Ethereum.

Motley Fool contributor Mitchell Lawler owns shares of Bitcoin and Ethereum. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Bitcoin and Ethereum. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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