T. Rowe Price Survey: 40% of Kids Think Crypto is the Future of Investing”

T. Rowe Price Survey: 40% of Kids Think Crypto is the Future of Investing”

According to the latest T. Rowe Price survey, children are more familiar with crypto than their parents, and 40% of children believe crypto is the future of investing.

More than 2,000 parents and their 8- to 14-year-old children were surveyed for the 2022 Parents, Children and Money Survey by the online market research company Dynata.

Fifty-seven percent of children surveyed said they were familiar with cryptocurrency, compared to 47 percent of parents. Among parents familiar with cryptocurrency, 32% say their children trade crypto more actively than they do.

When asked what they would do if given $100, 29% of children said they would invest it. Of these, 57% said they would invest in cryptocurrency, while 38% said they would invest in traditional stocks.

Forty percent agree that “cryptocurrency is the future of investing,” the survey also found, although parents don’t seem so convinced – 28% of parents surveyed said they are investing in crypto. 53% of those who invest in or are familiar with the space fear crypto is “a bubble that will burst,” and 52% fear it is a “short-term fad.”

Roger Young, thought leadership director at T. Rowe Price, which had $1.54 trillion in assets under management as of Feb. 28, called cryptocurrencies "extremely volatile and speculative investments" in a statement and noted that investing in a diversified portfolio of stocks and bonds and cash is "a sound strategy."

“It's great to see kids getting interested in investing, but parents need to talk to their kids about the risks associated with investing in cryptocurrencies,” Young said. “Families investing money in cryptocurrency should do their research and be prepared for a variety of possible outcomes.”

Given the size of digital asset markets, their impact on capital markets cannot be ignored, a spokesperson told Blockworks, noting that T. Rowe Price has analysts and investors closely following the space. Crypto’s market cap is about $2.2 trillion, according to Blockworks.

“We examined the risk and return characteristics and portfolio implications of crypto and perceived a wide range of possible outcomes,” the representative added. “The mandates we manage for clients today are not well-suited to investing directly in digital assets and we are aware of the high level of speculation and lack of regulatory clarity in this area.”

Other large asset managers are now starting to get involved in the segment.

BlackRock, for example, which manages more than $7 trillion in assets, began allocating two of its investment funds to Bitcoin futures contracts in January 2021. The fund group registered an ETF in January that would focus on blockchain technology, and its CEO, Larry Fink, recently said that the war in Ukraine could accelerate the adoption of digital currencies.

The release of the survey follows that of Investopedia 2022 Financial Literacy Survey which found that while crypto investing is popular among Gen Z, Millennials and Generation X investors, 49% of Americans have only a beginner's understanding of digital currencies.

Twenty-eight percent of Millennials surveyed by Investopedia expect to use cryptocurrencies to protect themselves financially in retirement, while that number was 20% and 17% for Gen X and Gen Z respondents, respectively.

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The post T. Rowe Price Survey: 40% of Kids Think Crypto is 'Future of Investing' is not financial advice.