One thing’s for sure. Few people expected cryptocurrency to become a major thing back when the first Bitcoin transaction was recorded in January 2009. Fewer still could have predicted how entrenched crypto would rapidly become in our economy, our vernacular, and our personal pocketbooks.  Crypto was too weird. Too nebulous. Too tough to get our minds around. Was it real money if you couldn’t hold it in your hand, buy a house with it, or spend it at the grocery store? There weren’t many souls brave enough to jump on the crypto bandwagon back then. But boy, have times changed.

By the most recent estimates, about 16% of Americans have invested in or traded cryptocurrencies at some point. Crypto enthusiasm is particularly strong among millennials and members of Gen Z. They represent some 94% of the crypto-owning community. And indeed, you can buy a house with crypto. And invest in a crypto retirement account. And satisfy your craving for a Subway sandwich or a latte from your local Starbucks, for that matter. So what does the future hold for crypto? We can expect it to be full of surprises. In May of this year, the price of Bitcoin reached its lowest level since 2020, for example. But recent adoption rates, market trends, and government interventions may offer some indication of where cryptocurrency is headed.


Tuning in to Crypto Advertising

When products are hot, they’re promoted. When products are promoted, they get hotter. For a pure gut check on how popular we can expect crypto to get, consider what you’re seeing while you’re streaming TV and between moves on Words with Friends. Ads for crypto exchanges, ads promoting crypto IRAs, and even highly-targeted ads wooing different ethnic groups to invest, are everywhere. Two crypto industry companies bought Super Bowl spots this winter. Celebrities are getting into the advertising game. And we all know how effective famous people are at promoting goods and services. By some estimates, advertisers have spent over $112 million on crypto campaigns since 2020. Compare that to the $165 million Colgate spends per year on advertising its toothpaste—a product that was launched in 1873 with much higher market penetration—and you can see how much cryptocurrency-related companies are investing in growing the market.

The Playing Field is Getting Bigger

Bitcoin was first sold in 2009. It took two years for the second cryptocurrency, Litecoin, to come around. Investors are trading more than 12,000 cryptocurrencies. The number of cryptocurrencies available for purchase doubled between 2021 and 2022. Crypto “retail” has grown at a phenomenal pace, as well. Today there are approximately 600 crypto exchanges worldwide. But because they are largely unregulated, that number is subject to change. Exchanges open and close every day. Crypto wallets are also proliferating. They’re often given away as freebies by crypto exchanges and many crypto investors carry more than one. The number of crypto owners reached 300 million in 2022, an increase of 178% in 2021. Some crypto market experts expect there will be a billion crypto owners by the end of this year. See advertising statistics above. And let’s take a look at the growing number of ways crypto owners can use and invest their assets.

You Can Buy a House with Crypto

There are two ways to buy a home with crypto. You can convert your crypto to dollars, Euros, or any number of fiat currencies and use that cash to make your down payment and monthly mortgage payments. But today you can also take out a mortgage using crypto funds directly. A financial technology company called Milo claims to have introduced the first purely-crypto mortgage. The company allows you to “borrow” up to $5 million for a home purchase.  It also boasts that you can finance 100% of your mortgage—no down payment required— and that you may be able to close on your loan in a single day. That’s a real boon in today’s competitive real estate market. Other lenders offer similar opportunities.


But crypto mortgages are different from traditional mortgages. While crypto lenders consider your crypto assets when approving you for a loan—something not all traditional mortgage companies do—they use your crypto assets to collateralize your loan. For example, if you want to buy a home worth $500,000, you’ll need to have crypto assets equal to that amount. Interest rates with Milo, for example, are adjusted every year, based on the value of Bitcoin. If Bitcoin’s value goes down, you may have to pledge more crypto to fund your loan or risk paying a higher interest rate.

Crypto mortgages are not for everyone. They are best suited to borrowers who have significant crypto holdings and other wealth reserves they can rely on when they tie up their crypto in a mortgage. The point is, however, that crypto continues to gain more influence in a wider range of financial sectors.

You Can Retire on Your Crypto Investments

The next financial sector that’s giving crypto its due as a growing asset class is the retirement savings industry. Once again, checking in with your favorite news channel or personal finance publication tells the story. There are now dozens of companies that can help you set up a self-directed IRA and fund it with crypto. Employees are also clamoring for crypto investing options in their 401K plans and the nation’s largest 401K management company, Fidelity, has announced that it will soon begin offering them. Others may follow suit, but legal experts warn that these management companies are putting themselves at serious risk of class action suits. The US Department of Labor, which regulates employer-sponsored retirement savings plans and devised the Employee Retirement Income Security Act of 1974, has expressed concern over this latest development in retirement investing, fearing a crypto crash and the devastation of millions of workers’ retirement savings that would follow. For now, Fidelity is limiting the amount of money employees can allocate to crypto in their retirement portfolios to 20% of their holdings.

If you’re not terribly risk-averse, crypto retirement investing is one route you might take towards diversifying your retirement portfolio. But the nearer you get to retirement, the riskier investing in crypto becomes. The crypto market is extremely volatile: Bitcoin has been known to lose half its value overnight. Analysts expect the market to resemble a roller coaster for years to come. Older investors, who would have less time to recover from a crypto crash, are advised to invest very lightly, if at all, in crypto, no matter how tempting it might be. Arguably, young employees, who have years of earning and investing ahead of them, are in a better position to manage that risk.

What About Regulation of the Crypto Market?

Conservatives revile it and liberals often cheer the phenomenon: follow the money and you’re likely to find government regulation close on its heels. But oddly, for now, the government has taken a pretty hands-off—or perhaps a wait-and-see attitude—toward crypto markets. That may be interpreted as tacit support for the growing crypto economy. For now, new regulations are few. Crypto is subject to the same capital gains taxes as stocks and other traditional assets when you sell it. It offers the same tax advantages when you hold it in a retirement account.


But government agencies are already making noises about regulations that may be coming. Joe Biden made a speech about it, issuing an executive order that federal agencies begin looking carefully at potential risks in the market. The SEC recently announced that it may require crypto exchanges to be registered and adhere to regulations around the custody of crypto funds. Exchanges are vulnerable to hacking and investors have lost millions to fraud by allowing exchanges to hold their investments for them. That’s one reason crypto security experts recommend holding your funds yourself in a crypto wallet.

The Bottom Line

We certainly don’t have a crystal ball that can reveal the secrets or future of crypto. No one does, so if an advisor or journalist speaks in absolute certainties about crypto, we suggest you give little or no weight to their prognostications. If you’re thinking of investing in crypto, take your time to learn more about the market in general and the performance of individual cryptocurrencies before you do. The recent crash of some cryptocurrencies, including Bitcoin,  Ether, and Dogecoin, should give all investors pause. Our recommendation?  Follow the most authoritative financial press routinely to track cryptocurrency as it becomes further entwined with the general economy. Keep up with how the government is responding to crypto market developments, too. You’ll find your path. Or maybe you’ll decide not to veer off the beaten one when it comes to investing your hard-earned cash. One size plan or one portfolio does not fit all. So be sure to look out for yourself, above all.