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For Gen-Z, social media isn’t just a platform for entertainment; it’s a major source of information, including financial advice. With cryptocurrency’s rise, Gen-Z investors are turning to TikTok, YouTube, and Reddit to navigate the digital asset space. However, while social media offers convenience and relatability, it also introduces risks, particularly when financial influencers—known as “finfluencers”—prioritize engagement over accuracy.
This blog explores how social media influences Gen-Z’s cryptocurrency investment decisions, offering insights into the opportunities and risks of relying on these platforms for financial advice.
According to The Motley Fool’s 2024 report, 67% of Gen-Z investors primarily use social media to inform their investment decisions, ranking it higher than advice from family, friends, or traditional financial websites. Popular platforms like TikTok and YouTube dominate, with YouTube being the top choice—used by 71% of Gen-Z for financial content.
The Ground Works Analytics report reveals that Gen-Z’s affinity for these platforms is rooted in the accessibility and variety of content. On TikTok, the hashtag #cryptoinvesting has amassed billions of views, showcasing the extent of crypto-related discussions happening in real-time. In contrast, only 34% of Gen-Z use traditional media like newspapers and television for financial updates.
These preferences highlight a shift from conventional financial education to more dynamic and community-driven sources, making it crucial to understand the appeal and influence of social media on this digital-native generation.
Gen-Z’s investment behavior is significantly influenced by the relatability and infotainment value of social media. The Ground Works Analytics report notes that social media provides a sense of community, allowing young investors to connect with others who share similar financial goals and experiences. This creates a collaborative learning environment that contrasts with the solitary nature of traditional financial learning.
Additionally, social media’s visual and interactive format is particularly effective. As per a survey by The Motley Fool, Gen-Z prefers video content over text-based resources—finding videos on TikTok and YouTube more engaging and easier to understand than long-form articles. These platforms allow influencers to break down complex topics like blockchain technology or crypto market analysis into bite-sized, visually appealing segments that resonate with young viewers.
However, this reliance on social media also has its downsides, especially when “finfluencers” promote high-risk strategies without sufficient disclosure of risks or credentials. Barclays’ survey found that 21% of Gen-Z investors admitted to investing quickly based on social media tips without verifying the information. This approach can lead to impulsive decisions and substantial losses, as we’ll discuss further
While social media offers a convenient way for Gen-Z to access investment information, it also poses significant risks. A 2024 study by Barclays highlighted that Gen-Z investors often fall prey to the fear of missing out (FOMO), which is prevalent on platforms like TikTok and Instagram. According to the survey, 16% of Gen-Z investors engage in crypto trading mainly to capitalize on short-term market movements—a behavior driven by social media hype.
One of the most alarming trends is the rise of unqualified “finfluencers” who promote speculative investments. Many of these influencers have no formal financial background and focus primarily on generating views rather than offering sound advice. This is especially concerning, as Interactive Investor reported that over 50% of young investors have used debt, such as credit cards or student loans, to purchase volatile cryptocurrencies like Bitcoin or Dogecoin based on social media recommendations.
This environment fosters risky behavior, often leading young investors to disregard due diligence. As Gen-Z increasingly seeks investment advice online, they must recognize the limitations and biases of these platforms and seek additional credible sources.
Recognizing the influence of social media, credible institutions are stepping up to provide accurate and accessible information. Platforms like Coinbase and Binance Academy offer free educational resources, designed to teach users about blockchain, trading strategies, and risk management. These initiatives aim to bridge the knowledge gap and encourage responsible investing.
Moreover, some social media communities are creating spaces for verified and legitimate discussions. For example, several Reddit communities, such as r/cryptocurrency, now enforce stricter rules about sharing sources and verifying information before posting investment advice. The Motley Fool reported that when Gen-Z investors use these vetted platforms, their risk of making impulsive decisions drops by 30%, showcasing the importance of credible education sources.
Social media undoubtedly plays a central role in influencing Gen-Z’s crypto investment decisions. While these platforms provide accessible and engaging ways to learn about digital assets, they also carry risks of misinformation and impulsive investing driven by FOMO. It’s crucial for young investors to be discerning, seeking out verified information and consulting multiple sources before making financial decisions.
Ground Works Analytics encourages young investors to explore diverse educational avenues, integrating social media insights with research-driven strategies. By balancing social media’s convenience with verified knowledge, Gen-Z can navigate the crypto landscape more confidently and make informed investment decisions.