Crypto and Generation Z

According to an analysis by the crypto analytics company Protocol Theory, Generation Z in the United States is increasingly choosing cryptocurrencies over traditional banks. This is not merely an interest in a new asset class, but a systemic shift in the financial behavior of the youngest adult audience. For Gen Z, control, transparency, and the ability to manage their own money independently, without intermediaries or opaque rules, are becoming central values.

A consumer behavior study published by Decrypt shows that 56% of Generation Z respondents prefer self-custody of crypto assets. At the same time, cryptocurrencies are perceived not as a speculative experiment, but as a full-fledged alternative to banking instruments, especially amid growing distrust toward traditional financial institutions.

Crypto trading. Image: Shutterstock/Decrypt

Generation Z, the youngest adult age group, demonstrates a strong desire to understand exactly what is happening with their assets. It is essential for them to be able to verify transactions, control how funds are stored, and independently choose between self-custody and services provided by regulated custodians. Analysts at Protocol Theory describe this factor as a “real competitive advantage” of cryptocurrencies over the banking system.

Statistics confirm the practical involvement of young people in the crypto market. According to the study, 49% of Gen Z respondents have already used cryptocurrency exchanges, and 37% currently own or use cryptocurrencies. This means that for a significant portion of the generation, crypto has moved beyond theory and become part of everyday financial practice.

At the same time, attitudes within the group are not uniform. Although 56% of respondents want to store assets independently, 51% simultaneously state that they would prefer to keep cryptocurrencies in banks or other regulated financial institutions. According to analysts, this duality reflects not a contradiction but a pragmatic approach – a combination of the desire for autonomy with the need for basic security and legal protection.

Protocol Theory CEO Jonathan Inglis explains this behavior through real economic constraints. According to him, young people increasingly feel that traditional financial pathways are either closed or significantly more difficult for them. High housing prices, rising education costs, labor market instability, and debt burdens create demand for alternative financial instruments where users feel greater control over their situation.

Inglis emphasizes that the key drivers of trust in cryptocurrencies are the sense of autonomy and the ability to maintain control. These factors, rather than promises of high returns, form the foundation of trust among Generation Z.

He also highlights a pronounced generational divide in attitudes toward cryptocurrencies. According to Protocol Theory data, 22% of Generation Z and 24% of millennials trust cryptocurrencies more than banks when it comes to asset security. By comparison, this figure stands at 13% for Generation X and just 5% for baby boomers.

five times as likely as older generations. This gap is shaping a long-term trend that is already beginning to influence financial products and institutional decisions.

Similar conclusions were previously reached in a 2023 study conducted by the crypto exchange Bitget among 255,000 respondents across 26 countries. Analysts then concluded that Generation Z would become the main driver of the global crypto revolution.

However, these trends are developing against a backdrop of broader societal skepticism toward cryptocurrencies. Data from the Pew Research Center for 2024 show that perceptions of the safety and reliability of crypto assets in the United States depend heavily on age and personal experience. Adults over the age of 50 are significantly more likely to report low levels of trust, while overall crypto usage remains limited.

Only 17% of U.S. adults reported that they have invested in, traded, or used cryptocurrencies. This figure has remained largely unchanged for three consecutive years, indicating a slowdown in mass adoption outside the younger demographic.

The age imbalance remains clear. People aged 18 to 29 account for 29% of all cryptocurrency users in the United States, while among those over 50 this figure is around 8%.

The preferences of younger generations are beginning to influence not only everyday financial decisions but also long-term obligations, including mortgage lending. U.S. mortgage lender Newrez, which services loans totaling approximately $778 billion, has announced plans to consider Bitcoin and Ethereum holdings when assessing the creditworthiness of certain borrowers.

Newrez President Baron Silverstein explained that this move is primarily aimed at Generation Z. According to him, future homebuyers increasingly hold a higher share of crypto assets compared to older generations, and ignoring this factor is becoming economically impractical.

According to Protocol Theory, the combination of consumer behavior data, changes in housing finance, and regulatory approaches indicates that issues of trust and control extend far beyond everyday crypto usage. They are beginning to directly influence long-term financial outcomes, access to credit, and the structure of the financial system as a whole.

Jonathan Inglis concluded that trust is built where users can verify what is happening and maintain control, and it is destroyed in situations where full responsibility is placed on individuals without clear safeguards, transparent protection mechanisms, and predictable access to their funds.

At the same time, despite growing interest from younger audiences, overall caution remains high. According to a Gallup survey, 64% of Americans continue to view crypto assets as very risky investments, underscoring the depth of the generational divide and differing perceptions of financial security.