A recent report from a local South Korean news outlet has highlighted an interesting trend among cryptocurrency investors from Generation Z (GenZ) in South Korea. According to News1 Korea, GenZ investors in the country are displaying a strong inclination towards investing in altcoins, particularly Ripple (XRP), as opposed to the more traditional choices of Bitcoin (BTC) and Ethereum (ETH).
The analysis conducted by News1 Korea focused on investment data from the first half of the year gathered from the popular South Korean crypto exchange Bithumb. The data pointed out a significant disparity in investment preferences based on age groups. Notably, individuals in their 20s were found to exhibit a more “aggressive” approach to investing, showcasing a heightened risk appetite compared to other demographics.
Interestingly, GenZ investors demonstrated a higher proportion of investments in altcoins beyond the well-known BTC and ETH, which were categorized in the study as both “long-term” and “stable” investments due to their relatively lower volatility. The report revealed that a substantial 82.5% of investors in their 20s allocated their funds to altcoins, excluding Ethereum.
Why South Korea’s GenZ is ditching Bitcoin for Altcoins
Out of the various altcoins available, Ripple (XRP) emerged as the favored choice among GenZ investors, with a notable 20.7% of them holding the digital asset in their portfolios. This statistic aligns with an August 4 report from the crypto derivatives exchange Bitget, which asserted that GenZ constitutes nearly half of all crypto copy traders.
Contrastingly, the study uncovered that investors in their 30s were more inclined to invest in Bitcoin and Ethereum, showcasing a broader trend of different age groups having distinct preferences within the cryptocurrency market.
The analysis takes place against a backdrop of ongoing challenges for Ripple, including regulatory scrutiny and a lawsuit in the United States. Legal experts estimated that these issues have set Ripple’s adoption timeline back by approximately three years. Meanwhile, South Korea itself has been tightening its regulations surrounding cryptocurrency activities. Recent news on August 22 indicated that authorities in the city of Cheongju are planning to confiscate cryptocurrency holdings from thousands of users who have managed to evade local taxes.
Furthermore, the South Korean crypto industry has seen notable instances of legal action against bad actors. The CEO of the crypto exchange Bitsonic was arrested by South Korean authorities on August 9 on allegations of embezzling $7.5 million in user funds, and the individual will face trial without preliminary detention.
In response to the increasing concerns about illicit activities in the crypto market, South Korea took a step toward stricter regulation on July 26 by establishing an interagency investigation unit aimed at combatting crypto-related crimes. The move was motivated by the rise in such activities and the desire to enhance investor protection in the cryptocurrency sector.
