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Volatility in Crypto Investment Could Put Off Young Investors From Further, Long Term Investments

An alarming number of young investors are funding their first taste of investing in cryptocurrency through a cocktail of credit cards, student loans, and other loans, according to new research by interactive investor, a UK based direct to consumer investment platform. Following the crypto boom, 45% of young investors aged 18-29 have said their first ever investment was in cryptocurrency.

The poll of 1,000 UK adults, aged 18–29, was conducted by Opinium for interactive investor between 21–25 June 2021. Cryptocurrency exposure was broken down by bitcoin, Dogecoin and ‘other crypto assets’.

Bitcoin was far and away the most popular cryptocurrency. A fifth of all 18–29-year-olds said they had invested in Bitcoin at some point, with half of these turning to debt to fund it: 23% used a credit card, 17% used a student loan and 16% used another type of loan.

Meanwhile 27% of respondents admitted to using their credit card to invest in Dogecoin, 17% said they used their student loan and 12% cited another type of loan.

Myron Jobson, Personal Finance Campaigner, interactive investor, says: “Unfortunately, the risks and volatility of cryptocurrencies aren’t always laid bare, and the worry is if young investors get their fingers burned, it can put them off investing altogether and miss out on a golden opportunity to help build their wealth through sensible, long-term investing.

“Young adults using credit cards, student loans and other forms of debt to invest is a worrying trend. We would never recommend using a credit card to fund investing.

And there is the possibility of damage to your credit score if repayments aren’t met which can seriously hinder your ability to get a mortgage and access other forms of credit in future. It simply isn’t worth it.”

Entering the mainstream?

The research suggests cryptocurrency have entered the mainstream for young investors, leaving traditional assets in its wake. Almost half (45%) of 18–29-year-old investors had their first taste of investing via crypto. That’s more than twice the number who had first invested via funds (23%) and way ahead of investment trusts (13%). Almost one in five (18%) of respondents said their maiden investment was in listed company shares.

Mind the risk gap

Even so, many young people are completely risk-averse, and with a 10-year horizon in mind, cash was considered the best home for the biggest chunk of savings (20%) followed by cryptocurrency (16%), shares (14%), funds (11%) and investment trusts (8%).

Myron Jobson continues: “While half of the young investors seem to have had their heads turned by crypto, the other half seem fixated on cash. None of us knows what the future holds for cryptocurrency. But we do know that traditional assets have been serving investors for decades, they are far easier to understand, and they spread your risk.”

Tips for beginner investors

Interactive investor has a knowledge centre for beginner investors:

interactive investor recommends six carefully selected Quick Start Funds for beginner investors:


  • BMO Sustainable Universal MAP Cautious. The lowest risk of the three BMO funds. It targets an annualised return of 2% above inflation over five years and can hold as little as 20% and as much as 60% in equities.
  • BMO Sustainable Universal MAP Balanced. The medium-risk option. The fund targets an annualised return of 3% above inflation over five years. The fund can hold as little as 30% and as much as 70% in equities.
  • BMO Sustainable Universal MAP Growth. The most adventurous, higher risk of the three but with potential for higher gains. The fund targets an annualised return of 4% above inflation over five years and can hold as little as 40% and as much as 80% in equities.

Bear in mind that each target for the funds is just a target and not guaranteed.


  • Vanguard LifeStrategy 20% Equity – for shorter term goals (3-5 years)
  • Vanguard LifeStrategy 60% Equity (for 5+ years)
  • Vanguard LifeStrategy 80% Equity (for 5-10 years)


  • Francis is a journalist and our lead LatAm correspondent, with a BA in Classical Civilization, he has a specialist interest in North and South America.

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