Students borrowing for crypto

One in five student borrowers use their school loans to buy cryptocurrencies

A generation in debt doubles down gambling with its future

Editor’s note: The source of the survey mentioned in this piece was… er… “cloudy”. An outfit called “The Student Loan Report” claims to have conducted a one-question survey of using Pollfish (Survey Monkey, no doubt, was busy and Questionnare Lemming was probably too expensive). The source article was said to have been written by a fellow named Drew Cloud. It turns out he doesn’t exist, so the veracity of the poll data should be rightfully questioned. Of course, we weren’t the only ones to be duped; The Boston Globe and CNBC also had the wool pulled over their eyes. That’s no excuse, of course, but that’s the world we live in and we apologize for any mental distress and anxiety this piece may have caused. 


Older folks have been admiring the younger generation’s political initiative in recent weeks, but let’s not look to them for financial guidance.

Americans have a total of $1.4 trillion in student debt, and it’s no secret that some of this loan money has sometimes gone to causes less worthy than the golden pursuit of knowledge. After all, there’s little formal structure in place to handle how a student spends loan leftovers. Beer and pizza costs are easily lumped in as living expenses covered by the federal government; students are generally free to spend leftover loan money any way they want.

Now the kids have found another way to spend their borrowed money. A survey of 1,000 student loan recipients reveals that 21.2 percent of them have used government loan money to buy cryptocurrencies like bitcoin and ether.

It should come as little surprise. College students are notoriously concerned with what’s cool and hip, and cryptocurrency was a cool and hip investment vehicle, at least in 2017. Booming markets inspired gushing headlines; if students weren’t spending their own money to buy cryptocurrencies, then of course they’re spending loan money to do so.

The survey doesn’t delve into how these students used their crypto assets. Some surely cashed out, while others bought with the intention to HODL and profit from any surge in value at a later date. The problem is that digital assets are volatile, losing value as quickly they gain it.

As the first decade of the cryptocurrency era comes to a close, its problems (and proposed solutions) are starting to surface. Things are changing quickly, which presents crypto as a high-maintenance investment. Bitcoin is down 60 percent from its all-time high, reached just three months ago. It’s been a rough couple of seasons for people with significant investment in the crypto market.

It’s safe to reason that a student attending college on a loan should have priorities besides cryptocurrency portfolio management.

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Dylan Love is an editorial consultant, contributing reporter, and fiendishly curious technology enthusiast. He owns no cryptocurrencies.