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Crypto is Gen Z’s most common investment in the UAE. Is that risky?

Individuals aged 18 to 24 are attracted to cryptocurrencies due to their potential for returns that surpass inflation.

Crypto is Gen Z’s most common investment in the UAE. Is that risky?
[Source photo: Anvita Gupta/Fast Company Middle East]

As technology continues redefining traditional financial paradigms, young people across the Middle East increasingly gravitate towards digital currencies for investment and financial participation.

A new report reveals a generational divide in the UAE’s investment landscape, with Gen Z embracing cryptocurrencies.

The International Financial Group Ltd (IFGL) survey depicts UAE residents’ investment preferences. 

Younger people between 18 and 24 are leading the crypto charge, drawn by the potential for sky-high returns that outpace inflation. 

Notably, Emirati males exhibit the strongest appetite for digital currencies, with 12% favoring them compared to 6% of females. Interestingly, males also lean towards property, commodities, and fixed-rate deposits, while females prefer the stability of national bonds.

Mutual funds and cryptocurrencies share equal popularity, narrowly edging out exchange-traded funds (9%). However, the tried-and-true haven of gold still reigns supreme, claiming the top spot for Emiratis and Asians, tied with property at 24% each.

Simon Barwell, IFGL’s Marketing Director, said: “Some UAE investors are clearly pursuing risky strategies whereas they should be building a diverse portfolio of assets with different risk and return profiles.”

“Cryptocurrencies have a history of volatility while property is an illiquid investment, so UAE investors should be thinking about equities and bonds, both locally and overseas. A balanced strategy is the key to long-term wealth accumulation.”

Interestingly, individuals above 45 show less enthusiasm for crypto and ETFs, with IPOs least favored across all demographics.

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