Robinhood Adds Crypto — And Millennial New Yorkers Shrug

Young investors and non-investors in New York say the platform adding crypto trading doesn’t change much for them.

Robinhood, a no-fee investing platform targeting the mobile app generation, has just rolled out crypto trading for New Yorkers. The California-based company received a BitLicense four months ago from the New York State Department of Financial Services (NYDFS), and now offers Empire State residents the ability to trade seven major cryptocurrencies.

We asked a handful of millennials — the demographic most connected with mobile apps — whether they expected this development to spark crypto fever among their peers in a generation that is generally wary of investing. The response among interviewees — who represented a wide range of investing backgrounds — was tepid. Most did not think that Robinhood adding crypto options was likely to draw many new millennial traders into digital currency.

Robinhood just rolled out crypto trading for New York State residents.

“What stops me from investing in crypto is the underlying lack of intrinsic value,” said Jeff Weisbein, 29, founder and CEO of BestTechie, a brand focused on making tech “easy for everyone.” Weisbein currently lives in New York City and invests in traditional equity through a wealth management advisor.

“[Crypto] is all hype and speculation,” added Weisbein. He explained that the ability to more easily trade crypto assets is probably not convincing anyone who’s not already convinced to participate. “You’ve either bought in or you haven’t,” he said.

Others echoed this sentiment. Despite the app’s relative ease of use and short attention span-friendly interface, anyone savvy enough to be trading on Robinhood is not going to be swayed just because the currencies were added, they agreed, though some said that an existing trader may decide the app is more convenient to use than something like Coinbase, which only lists digital coins.

Millennials, also referred to as Generation Y, encompass those born roughly between 1980 and 2000. Having witnessed the fallout of the 2008-2009 financial crisis, they have not been drawn to the stock market like previous generations, and generally report being intimidated by investing. Millennials have also been called a generation of “socially responsible investors” — they prefer their investments align with their principles. While crypto could be a force for socioeconomic good, the average millennial remains uninformed or skeptical about its potential.

When millennials do invest, they tend to gravitate to stable assets. People we spoke to said crypto just isn’t “big enough” yet. Still, most Bitcoin investors fall squarely within the millennial age range. A recent survey revealed 58% are between the ages of 18 and 34.  

Ben, a 30-year-old postdoctoral statistician who does not live in New York but has family there, invests in traditional stocks on Robinhood and owns a small amount of Dogecoin, which he bought in early 2019 “for fun.” Dogecoin is one of the seven cryptocurrencies now available to trade on Robinhood.

While he appreciates that Robinhood’s recent move allows him to keep his traditional and crypto investments on one platform, it still “feels a little fake,” he says. “There’s no way to send [crypto] to other people from Robinhood, like a true crypto wallet,” he said. Ben also does not plan to buy or trade any more crypto.

Users may appreciate the commission-fee trading (Robinhood still implements the occasional fee) but others — including some aggrieved Reddit commenters — cite a lack of flexibility to Robinhood Crypto, including the inability to withdraw crypto on the app.

Robinhood must have had its motives moving into New York, one of the most regulatorily hostile states when it comes to crypto, where a BitLicense application can end up running $50,000 after legal fees.

For many, more widespread adoption and use cases are needed to really turn the tide. Perhaps this is what the company is banking on.

“I will never use crypto at my deli or shopping online,” said Erica, 31, a New York-based finance worker who asked that her real name not be used. “I can’t think of any useful application and have no desire to invest in it.”

Erica has a 401k and savings in a mutual fund, but says she’s too skeptical about crypto to ever buy in, calling it a “fad” that is “trying to solve a problem most people don’t have.” She conceded that while she understands the money-making opportunities in crypto, she prefers not to invest in something she doesn’t yet “believe in.”

“Nothing has convinced me that crypto will solve any problems, or that it has,” she said. “It just seems like a black [or] gray market currency. Quite frankly, my weed dealer accepts cash, so I’m good.”

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