The launch of bitcoin-based ETFs in January brought renewed attention to this controversial asset class, and as people start adding them to their brokerage accounts, it remains to be seen who finds them attractive.
One way to understand cryptocurrencies, both their appeal and chaos, is a form of intergenerational revenge. The older generation who control the economy have used the economy to their advantage for decades. They have debts they cannot repay, increasing the value of most of the assets they own and creating barriers to mobility. They also used their political influence to make these moves difficult to reverse.
Crypto is attractive as a vehicle for change because it is both a disruptive technology and an asset class. Take those strange bedfellows who lead the opposition as evidence. That doesn't sit well with Elizabeth Warren, a 74-year-old progressive Democrat who built a career on Wall Street. The 67-year-old king of the banking industry, Jamie Dimon, shouldn't be hated either. After a decade of arguing over various issues, they came to the conclusion that they didn't like Bitcoin.
The late billionaire investor Charlie Munger, who has died aged 99, called for bitcoin to be banned, while liberal economist Paul Krugman, 70, predicted the industry would fade into obscurity. But their children and grandchildren would likely disagree, the survey data showed. Of the 50 million Americans who have owned cryptocurrencies at some point, the majority are under 40 years old.
Young people live in constant economic fear, and for good reason. As college tuition rises, more debt is required to complete a degree. People with student loan debt are struggling to afford home ownership, a problem exacerbated by rising real estate prices. The rent is often very high. Social Security will run out before millennials retire.
It would be one thing for young people to overcome these challenges by building wealth like their parents, but that would require periodic declines in asset prices. Long-term charts show that this is rarely due to government intervention. As we saw in the recent bear market, monetary easing and government spending led to a small decline. Despite the economic downturn, stock and real estate prices rose in 2020. If a once-in-a-century pandemic doesn't improve accessibility, what will?
The latest attacks on monetary and fiscal policy standards have been led by Fed Chairman Jerome Powell, 70, and Treasury Secretary Janet Yellen, 77, who both believe in the economic doctrine of "keeping asset prices high." The geriatric presidents appointed by them did the same. The average age of a senator is 65 years.
These measures especially benefit the elderly. Most stocks in the U.S. are owned by people 45 and older. Among those under 35, the share is less than 2%. The average home buyer is about 50 people.
There are also legal barriers to wealth creation. Stocks and houses are expensive, but at least they are affordable. Alternative investments such as venture capital or private equity are not appropriate. Accredited investor laws limit ownership of these risky investments to already wealthy individuals.
These laws exist to protect "risky" investors, but the argument that a wealthy boomer investing in an AI startup is more sophisticated than an MIT student is valid. It was the same in boom countries - for decades, private investment outpaced public investment.
An exception to this dynamic is cryptocurrency. Bitcoin is a rare asset that outperforms and is accessible to everyone, younger and more tech-savvy investors. Grandpa may have gotten lucky with a venture capital grant, but he probably didn't think about cryptocurrency. Digital assets are terminological and confusing, even by technical standards. They represent a paradigm shift towards a less gerontocratic system.
Cryptocurrencies are algorithmically backed money, unlike traditional central banks. NFTs are digital art created by teenagers, as opposed to physical art collected by baby boomers. Memecoins is part community, part gambling, and mostly a joke — one that doesn't involve Liz and Jamie.
Neither the septuagenarians nor the crooks driving our controllers find it funny. But that's exactly what it's about. The old system they continue to defend has failed young Americans.
As tempting as it may be to dismiss cryptocurrencies as generational self-destruction, there are many elements behind it, especially in the current system where mounting debt, rising inflation and political chaos are the norm. Kids are wrong, but they're finally doing something about it.
Amid Malekan is an associate professor at Columbia Business School and the author of Re-architecting Trust, The Curse of History, and The Crypto Cure for Money, Markets, and Platforms . Opinions expressed in the Fortune.com comment section are solely those of their authors and do not necessarily reflect the views or beliefs of Fortune .
This story originally appeared on Fortune.com