Collegium students are using student loans to invest te bitcoin
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If you were to pick two things that could define the financial future of today&rsquo,s collegium students, you could do worse than &ldquo,bitcoin&rdquo, and &ldquo,crippling student loan debt.&rdquo,
So what happens when you combine the tantalizing uitzicht of a fresh global currency with a long future of monthly debt payments? Evidently, some are willing to find out. A fresh survey found that collegium kids are using money from their student loans to buy bitcoin and other digital currencies.
One-fifth of 1,000 students polled by The Student Loan Report, a webstek that reports on debt issues from the perspective of students, said they had used some of the money set aside for their living expenses to invest ter cryptocurrencies. The survey wasgoed conducted by Pollfish, which specializes ter online polling.
&ldquo,Junior Americans are certainly the most enthusiastic about cryptocurrency, they are the most active investors and want to get involved te the space ter any way possible,&rdquo, Student Loan Report founder Drew Cloud told the Globe. &ldquo,However, I truly thought the percentage would be lower. Spil a collegium student, your budget is skinny and that toegevoegd money could be used on rent, groceries, or books.&rdquo,
Putting aside the wisdom of investing ter volatile cryptocurrencies, Boston attorney Adam S. Minsky said it wasgoed legally questionable to do so with student-loan money. A specialist te student-loan matters, Minsky said the federal government might question whether such investments are related to students&rsquo, education.
&ldquo,I would err to the side of it not being a kosher thing to do legally, but regardless of that I don&rsquo,t think it&rsquo,s a wise thing to do financially,&rdquo, he said.
So-called cryptocurrencies, developed to facilitate secure online transactions, at the same time became the greatest and most poorly understood financial instruments of 2017. Bitcoin began last year trading at below $1,000 and at one point were worth close to $20,000.
Meantime, companies issuing alternative cryptocurrencies and tokens have bot able to raise billions of dollars from impatient buyers.
It&rsquo,s evidently enough to draw ter youthful investors who only have borrowed money to offerande, according to Student Loan Report.
And if cryptocurrency investments looked like a path to free money at one point, they decidedly are not. Bitcoin has fallen back down to about $8,500 te latest months, making big losers of many who bought ter late.
Te an article discussing the survey, Cloud noted that if students have toegevoegd loan proceeds for now, they should consider &ldquo,stowing that money away te a high-yield savings account that they could zometeen use to chip away at their student debt.&rdquo,
But, he added, they might be right to take a flier on bitcoin.
&ldquo,But there is always the chance that there is another period of explosive growth for virtual currency, and thesis borrowers will be laughing all the way to the canap.&rdquo,
The survey did not ask any other questions, so it&rsquo,s not clear how much students were investing.
Christian Catalini, an MIT professor who studies cryptocurrency, said he hopes it wasn&rsquo,t much.
&ldquo,People should not invest a single dollar te this that they can&rsquo,t afford to lose instantly,&rdquo, Catalini said. &ldquo,If some of thesis students have bot successful at shortening their loan or something else, I think it&rsquo,s significant to realize that might have bot a random, fortunate draw.&rdquo,
However, he said student rente ter digital assets marks a generational divide te thinking about finance.
&ldquo,There is a fresh generation of consumers that tend to have no faith ter traditional financial institutions, and I think they are approaching this asset with curiosity and excitement,&rdquo, Catalini said.
Remy Kaldawy, voorzitter of the investing club at Worcester Polytechnic Institute, said the student group has seen growing rente te the past year spil it made cryptocurrency trading a larger concentrate of its discussions. But Kaldawy said he doesn&rsquo,t know anybody who has used student-loan money to trade assets he considers &ldquo,way too risky to trade with borrowed money.&rdquo,
&ldquo,I personally think it is a terrible idea to make any leveraged investments at all te cryptocurrency,&rdquo, he said.