The head of research and co-founder of Fundstrat Tom Lee gave a rousing speech on why he believes Millennials will drive massive adoption of Bitcoin and cryptocurrency.
At the ChainXChange conference in Las Vegas, Lee began by comparing the generational forces that triggered mass adoption of the internet and smartphones to what’s happening in the world of crypto.
“To me, wireless and the internet in the ’90s was very much a generational change that people 20 years older than me simply just didn’t understand. And I think that’s the same thing that’s happening with digital assets and blockchain today.”
He points to the fact that Millennials are overtaking Baby Boomers as America’s largest generation, and highlights the powerful impact that could have on the proliferation of digital assets, given Millennials’ mistrust of banks. A 2016 survey from Facebook showed 92% of Millennials don’t trust banks, and a study from First Data showed 71% of Millennials would rather go to the dentist than go to a bank.
“Clearly, Millennials hate banks. Why do they hate banks? They hate banks because their parents lost their homes in the financial crisis… Today, 70% of Gen X and 60% of Millennials never visit a bank branch. They do all of their transactions online. So to them, native digital is something they’re very comfortable with…
Within 10 years, Millennials are going to control the majority of the wallet in the United States. So think about it this way – if you had to think about where money incrementally is being spent and who controls it, it’s the Millennial.”
Lee says those statistics combined with historically low trust in governments around the world are evidence that traditional finance and the banking industry is ripe for technological disruption.
“First Data estimates that by 2020 Millennials will control about $7 trillion in financial assets, of which a very small percentage is allocated to digital assets. But here’s just a thought. What if 10% of that goes into native digital assets, into crypto. As you all know, the multiplier for crypto estimated by Kyle Samani at Multicoin Capital is about 20-25 times, which implies almost a $14 trillion increase in the market cap of the crypto space just from US Millennials allocating into crypto.”
As for the current state of the crypto market, Lee says the bear market presents an opportunity for investors that can be compared to the landscape after the 2008 crash of the stock market in the US.
“The question you have to ask yourselves is, ‘Now that crypto is down here, is it appropriate to be bullish or bearish?’ And I just want to absolutely point out it is a mistake to be bearish when you’re already down. This is like looking at stocks in December 2008 and deciding you wanted to become secularly bearish, even though the bear market was ending.
So I think the bear market has largely run its course in crypto, and it’s been healthy. It’s been resetting capital. It’s resetting investor expectations. But most importantly, the only time you can really make money in a big way is to buy when investors aren’t buying. That’s the real opportunity.”