Gen Z’s Growing Preference for ETFs

Binance Research recently revealed that exchange‑traded funds (ETFs) are capturing an increasing portion of equity activity among Gen Z users. In early August, ETFs represented 25 % of the cohort’s overall trading volume on the platform. Net equity inflows into ETFs rose to 21.9 % in July from 18.5 % in June, while the share of individual stock inflows fell to 74.2 % from 77 % during the same period.

Lower Trading Frequency Across Generations

When Binance compared Gen Z activity to that of Millennials, Gen X, and Baby Boomers across direct equities, tokenized stocks, and traditional‑finance (TradFi) perpetual contracts, Gen Z consistently traded less often. For example, Gen Z averaged just 13 monthly trades in TradFi perpetuals, whereas Millennials traded 17 times and Gen X 16.5 times per month.

Buy‑Only Accounts and Asset Preferences

The study also highlighted a high proportion of buy‑only accounts among younger traders. In direct‑equity accounts, 22 % of Gen Z users had never placed a sell order, compared with 19 % of Gen X and only 9 % of Baby Boomers. Millennials had the largest share of buy‑only accounts at 30 %. Within Gen Z’s buy‑only portfolio, the most frequently purchased assets were Broadcom, Tesla, and the Schwab US Dividend Equity ETF.

Limited Interest in Leveraged and Inverse Products

Gen Z showed a relatively muted appetite for leveraged and inverse ETFs. A striking 88.2 % of Gen Z TradFi perpetual accounts had no activity in these products, compared with 84.5 % of Millennials and 85.9 % of Gen X.

Tokenized Stock Market Dynamics

In related tokenized‑stock activity, Binance’s own bStocks briefly surpassed Kraken’s xStocks as the second‑largest issuer. As of early Tuesday, bStocks held $610.6 million in tokenized‑stock value versus $601.2 million for xStocks. By Friday, xStocks had reclaimed the position with $610.7 million, while bStocks dropped to $579.6 million. Together they accounted for 22.3 % and 21.2 % of the roughly $2.7 billion market, respectively. Ondo Finance remains the largest issuer with $971.8 million.

The overall tokenized‑stock market continued to grow, with RWA.xyz reporting $2.43 billion in distributed value as of Friday, a 5 % increase over the preceding month.

Takeaway

Binance’s data underscores a generational shift: Gen Z is increasingly channeling equity capital into ETFs, trading less frequently, and exhibiting cautious use of leverage. Meanwhile, the tokenized‑stock sector remains competitive, with rapid movements among the top issuers.