Graduation is a time for celebration, when schools recognize their students’ accomplishments and students prepare to move on to the next stage of their lives. For many families, it also means selecting a gift that can commemorate the experience–and get grads off to a good start in preparing for their financial future.
This year’s graduates are entering the toughest job market in recent memory, so giving them a watch or a gift card might not cut it. These young people need more than a diploma to face the challenges that ahead—they need the kind of value and earning potential that cryptocurrency can provide.
Why Give the Gift of Crypto?
The value of cryptocurrency can fluctuate widely, but that volatility is the reason many people consider crypto an excellent investment opportunity. Consider the price of Bitcoin—one of the most well-known cryptocurrencies in the world. In the summer of 2016, the price of one Bitcoin was hovering somewhere between $500 and $700. By the summer of 2020, the price of one exceeded $9,000. You’re not going to get that kind of return on investment from a set of luggage or cufflinks.
But growth potential isn’t the only reason to consider giving crypto as a graduation gift.
Creating a Safety Net
During times of extreme uncertainty, crypto can offer a much-needed safety net for recent graduates who may be struggling with money. The price of crypto isn’t closely tied to stock, bond, or real estate prices, so its value can hold up even in the face of a meltdown in traditional markets.
In the early years, it was difficult to find merchants who would accept crypto as a form of payment. These days, however, there are many merchants, both online and offline, who accept crypto, ranging from local shops and restaurants to major e-commerce retailers.
Access to Financial Services
Many young adults don’t yet have credit or access to traditional financial services. Crypto opens the door for them to become part of the global marketplace, whether or not they have a traditional checking account, savings account, or credit card. This access can help them avoid high-cost alternatives for paying their bills, such as pre-paid debit cards or money orders.
Many young people graduate from high school or college with little or no knowledge of the most critical components of financial literacy. By getting them involved in crypto, you can help them get a better understanding of investing, saving for the future, growing wealth, and managing market fluctuations. Learning shouldn’t stop at graduation, and knowing how to grow wealth can be a lifelong project that starts with a crypto gift.
How to Gift Crypto to a Grad
Once you’ve decided to give crypto as a graduation gift, here’s what you need to do:.
Step 1: Decide which cryptocurrency to buy. There are currently more than 900 cryptocurrencies on the market, but as a graduation gift, it usually makes sense to stick to well-established crypto like Bitcoin, Ethereum, or Litecoin. There’s also the option to go with stablecoins, whose value is linked to the U.S. dollar, in case your gift recipient is more risk-averse.
Step 2: Purchase from a reputable exchange.
Exchanges are platforms that allow you to purchase crypto with cash. They are generally operated by a centralized entity, and funds are stored on the exchange itself, providing quick and easy access to owned assets. These established exchanges are good places to buy your crypto gift. Coinbase
is a popular exchange in the U.S., and the company makes it easy to connect your bank account or credit card to buy crypto.
Step 3: Transfer crypto to your grad.
There are several ways to transfer crypto to another person. If your grad doesn’t already have a Coinbase account, the best approach might be to sit down with them to help them create an account, then send the crypto directly from your account to theirs. Coinbase has step-by-step instructions for sending and receiving cryptocurrency
Step 4: Put the crypto to work,
Coinbase is an excellent place to buy and sell crypto, but it won’t help your grad grow their investment. Encourage them to consider signing up for a BlockFi Interest Account
so they can earn interest on their crypto holdings. They can send their crypto directly from Coinbase to BlockFi
to start earning, obtain a crypto-backed loan, and even trade between different cryptocurrencies and stablecoins.
Graduation gifts can be a little dry and boring. Cash is nice, but it will almost certainly be spent by summer’s end. A new car is flashy, but starts depreciating the moment it leaves the dealer’s lot. Getting your grad started with an investment in cryptocurrency is a lot more interesting, and has the potential to set them up for a lifetime of financial learning and growth.