Generation Z crypto investors are showing a strong inclination towards copy trading or social trading, a method of investment that involves replicating someone else’s trades, according to a report published by Bitget, a crypto exchange. The report revealed that out of all the copy traders registered on the platform, 44% of them were under the age of 25. Following closely behind were individuals aged between 25 to 35, making up just under one-third of all copy traders. On the other hand, the older generation, aged between 35 and 55, accounted for 17% of copy traders, while those over 55 constituted a mere 7% of the total.
Copy trading, which is also offered in traditional stocks, has gained popularity in the crypto space and is currently provided by exchanges such as eToro, Bybit, and MEXC. This method allows users to replicate positions opened and managed by a selected individual, using an automated tool. Bitget speculated that the Gen Z’s tendency to seek investment advice from social media influencers may explain their affinity for copy trading. A survey conducted by Forbes Advisor in January found that approximately 80% of Gen Z and millennials rely on financial advice obtained from social media. Fifty percent of those surveyed claimed to have made profits from the advice received, with YouTube, Reddit, and TikTok being the most trusted platforms.
Furthermore, a report from the CFA Institute and the Financial Industry Regulatory Authority (FINRA) Foundation in May revealed that crypto was the preferred investment choice for Gen Z. It stated that 44% of Gen Z investors in the United States began with a crypto investment, compared to 35% of millennials. Additionally, 43% of British and 35% of Canadian Gen Z investors considered crypto as their first investment.
Bitget’s report highlighted that the majority of its copy-trading users, nearly a third, were from Western Europe. However, the next two largest segments were East and Southeast Asia, accounting for almost half of the users. Interestingly, even though African users made up only 1% of Bitget’s global copy traders, 62% of them expressed interest in copy trading, which was the highest proportion among all regions.
In conclusion, Generation Z investors in the crypto space are increasingly drawn towards copy trading. This investment approach, which involves mirroring the trades of others, has gained popularity due to its ease and the influence of social media on investment decisions. Additionally, the report highlights the strong preference for crypto investments among Gen Z, with a significant number of them starting their investment journey with cryptocurrencies. With the continued growth of the crypto industry, it is expected that this trend of copy trading and crypto investments among Gen Z investors will continue to expand.
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