Should the NFT space have age restrictions?
TLDR: While it’s impossible to implement age restrictions across the entire crypto industry, it is perhaps something all of us involved in it should think about. There are many risks – financial and otherwise – in this space, and should we really be allowing young people to dive into them without any protection?
I’m prefacing this article in a big font by saying I know you can’t actually pop an age restriction on the NFT space because it’s big and complicated and has no legal infrastructure etc. etc. I’m just asking the question. Alright, let’s go.
Things you can’t buy if you’re under 18 in the UK
Alcohol
Tobacco
Lighter refills
Crossbows
Volatile substances/solvents (ie paint
thinners/some types of glue)
Weapons or knives
Fireworks & sparklers
18-classification DVDs, videos and computer games
Crossbows… who knew? Honestly I didn’t think anyone could buy a crossbow, but it’s good to know there’s an age restriction on that.
Age restrictions are there to protect young people. As much as they (and we, when we were their age) may find them irritating, unnecessary and boring, they exist to preserve safety, and take the power to make potentially bad decisions out of the hands of those who don’t have enough years on this planet to fully understand their consequences.
Youth is wasted on the young. Investing… isn’t.
Do you know what else under 18s can’t do? Invest in the stock market*. Now, while investing in the stock market may not, at first glance, come across quite as potentially dangerous as being able to buy both alcohol and a crossbow, it is equally important to prevent young people from doing it, because it does have the potential for harm.
How? Because a lack of investment knowledge and education, spur of the moment choices, and emotion-driven decision making (more likely in teenagers due to all them hormones) is a recipe for disaster in the world of investments. The potential for them to accidentally lose more than just their pocket money is too great to allow to even be a possibility. So, it’s against the law for anyone under the age of 18 to invest in the stock market in the UK.
*There are some ways those under 18 can invest in the stock market but they have to set it up with their parents and it’s a whole different kettle of fish. For the most part, if you’re not 18, you’re not investing in stocks.
Can you buy crypto and NFTs if you’re under 18?
Unfortunately there isn’t a straight yes or no answer to this at the moment. This is because whether or not there are restrictions based on age depends on the platform you’re using, as there is no industry-wide legislation.
While some platforms (detailed below) do require users to be over the age of 18 and ask for identification to prove it, others may say their service is ‘intended for over 18s’ but don’t ask for identification, or it’s not specified at all. So it’s safe to say that it is indeed very possible (and easy) to gain access to a digital wallet that will allow you to buy and sell crypto and NFTs regardless of your age.
Some key considerations
Before I continue, there’s a few fundamental things that we should remember about NFTs:
It’s only in the last month (yes, month) that you’ve been able to pay for the purchase of an NFT with fiat currencies (that is your dollars, your pounds, your euros etc.) via your debit or credit card. Prior to this, you could only purchase an NFT with a cryptocurrency or token, like BitCoin or Ethereum. Because we don’t use cryptocurrencies in daily life, they can feel kind of like monopoly money. It’s already in your wallet, you can’t feel it, touch it, you forget that you had to do something to earn the money to buy it – monopoly money. Have you ever been too concerned about blowing all your monopoly money on Mayfair? No. Why? Because it’s not real. Sometimes, that’s how cryptocurrency feels, too.
There is absolutely no certainty when it comes to the value of NFTs. Yes, this is true for all investments, however with stock market investments, they almost all go up if you wait long enough. Not financial advice, I’m not an expert, but this is a generally accepted thing. With NFTs, your JPEG could be worth $100,000 on Monday and $2.75 by Wednesday evening. There are absolutely no certainties – if Elon Musk tweets, your whole NFT investment can come crashing down. It’s a lotta power for Musk, and a lotta risk for you.
They are community driven. Mildly in contradiction to what I just said about Elon Musk, largely, it’s the community that drives and decides the price of an NFT once it’s being sold on the secondary market. This is an interesting phenomenon that I’ll explore in another piece eventually, but this is enough to know for now.
Should under 18s have access to the NFT space?
Now, to the crux of this whole thing. We know that anyone of any age can currently have access to the NFT space, both as an observer and as a participant – but should this be the case? Why, when those under 18 are not allowed to invest in the traditional sense, are they perfectly able to invest in something that is arguably even more volatile and financially dangerous?
The arguments on both sides are numerous and essay-worthy, so I’m not going to go into them all. Instead, I’m going to outline a few that I feel are key to this whole quandary, with the caveat that a) not a financial expert, not financial advice, b) I, myself, am well over 18 and so am keenly aware of how immature I was at that age, and c) I’m still new to this whole shindig.
Okay, caveats aside, let’s dig into the arguments for and against under 18s having unfettered access to the NFT space.
Argument #1: FoMO
For: Social media is the youth’s bread and butter. They know the tricks to watch out for (bought followers, bots etc.) and they’re pretty savvy.
Against: Whatever your age or experience, it’s easy to get caught up in social media hype, especially if you’re properly embedded in that world.
A huge proportion of the activities in the NFT world take place on social media, specifically Twitter and Instagram. It’s the place to get information and access. Used honestly, it’s a great tool for projects to build communities and spread the word. Used dishonestly, it’s a prime place for scams, hacks, rugs*1 – you name it.
These dishonest users manipulate our human bias towards conformity, most often by buying followers or using bots to make it look like they have an enormous following. This creates false hype that induces Fear of Missing Out (FoMO) in the very best of us and convinces investors that this is the next big project.
While we’d all like to think we’re smarter than to fall for that – whatever our age – even the best of us fall prey to this kind of falsified social influence. I myself have been caught in this trap not once, not twice, but thrice* in the space of a few months. Me, a grown woman who owns a house, is married, has managed her finances for a long, long time and even once worked for a financial organisation. I have literally no excuse for being duped and yet I still was.
So if grown ups like me are falling prey to this, how is someone with less than eighteen years of life meant to figure out the projects with real promise from the ones making false ones? Well, it can be argued both ways.
Young people are social media natives, they’re clued up on the tricks that can be used to make people and projects look more popular than they really are. In this sense, under 18s are maybe better placed than older users to spot the facts from the fakes. However, young people are particularly susceptible to FoMO§, particularly on social media – and as we know, social influence can be so very powerful that it can encourage us to ignore our knowledge, experience and instincts.
*see that little ghost in the picture up there? I bought it for $200. It’s worth $28 now. Don’t tell my mum.
Argument #2: Gambling-adjacent
For: Buying and selling NFTs isn’t actually gambling, and technically under 18s should have limited access to funds to lose.
Against: The financial loss can be besides the point, the issue is that it could create a propensity for gambling within the space without young people realising that’s what they’re doing.
There is a very, very fine line between investing and gambling. It’s a line that can be as hard to see as it is to admit.
As much as all of us in the NFT space claim “it’s for the aaaaaahhhhrt”, most of us are also hoping to become overnight millionaires, let’s be honest. It’s an age-old enticement: the idea that you could spend a little on something that becomes worth a lot. In fact, it’s more than enticing, it’s positively dollar-eyes desirable and you can’t help but hope that each project is going to be the one. So you spend the money on it. And it’s not the one. So you spend it on another one. Also not the one. And so on and so forth until you can end up in a bit of trouble.
If you aren’t careful, NFTs can just become a new way to gamble. And know who can’t gamble? Under 18s – because knowing when to stop and when to say no is a skill that, for lots of us, takes many years (and many losses) to master.
The issue is that there’s no overt warnings out there (like there are on gambling apps or adverts) that say be careful, don’t spend more than you’re willing to lose, and you may not get back what you spent on your NFT. There’s no disclaimers anywhere and there’s no education and there’s no protection – for anyone, but as with traditional gambling, we just hope that age equates to sensibility, and that us grown ups just know the risks.
For young people, who’ve no real experience with gambling (at least, they shouldn’t have) how are they meant to recognise the signs of their NFT-trading becoming a matter of gambling and protect themselves from spending (and potentially losing) more than they have?
Well, one argument is that “surely under 18s have limited access to funds” – and yes, hopefully this is right. If you lose your pocket money, you lose your pocket money, but no great finance-threatening harm done there. But what internet-native kid doesn’t know how to use their caregiver’s card? If you honestly thought just an extra tenner could make you a millionaire, I don’t care how old you are, you’d do it. So while the risk may be minimised by that pain point of physically not having the money if you’re under a certain age, it doesn’t make it impossible to lose more than you have.
Argument #3: Age vs Maturity
Against: The general rule is that maturity grows with age, and given that this is a financial space, age restrictions may be the best protection.
It’s an age-old conundrum, does maturity come with age? It’s impossible to answer because it seems to depend entirely on the person.
For every under 18 that is immature, impulsive, irrational, there’s one that is mature, measured and pragmatic. This is the case for every age group – some people never mature (maturity is also somewhat undefinable, which adds another layer of complexity) and some people are just born sensible.
The fact is, there are some 45 year olds that behave terribly in the NFT space – they’ll bully and harrass, intentionally bring the floor price down, spread FUD *2. While there are some under 18s that are incredibly balanced, work hard to foster a sense of community and are smart with their investments.
And this is why it’s difficult – you can’t put maturity restrictions on things (oh that you could) only age restrictions. But if you were to put a blanket age restriction on NFTs, you’d be blocking some smart, young minds from investing in and exploring a growing space, and that’s not fair.
But if you abide by the idea that maturity grows with age, an age restriction may be the best way to protect young people from losing money in the space and also damaging the space itself, which is easily done by saying the wrong thing.
Argument #4: Creativity
For: The NFT space offers a brand new place to create and explore digital art, with the potential to make a living from it.
Against: There are safer, more established places for young people to explore digital creativity.
One of the amazing things about the NFT space is that it’s a way to participate in, share and create a totally new kind of art. And there’s lots of stories, like this one, about young people finding their entrepreneurial feet in NFTs.
However, there are some notes of caution with this:
It’s a hard space to be successful in, particularly as the success on and NFT project is no longer just about the art, it’s about the community and utility and all sorts of other things that you need a whole team of business people to crack.
Major success stories like the one above have the potential to damage the confidence and mental health of all the other young people who aren’t making millions with their digital art (because NFT-maker millionaires are still in the minority, regardless of age).
When you put your art out into any space, digital or otherwise, you’re opening yourself up to criticism from anyone and everyone, which can also be damaging
So I suppose the argument against young people using the NFT space as the home of their creativity is that there are safer, more established places to be creative.
Argument #5: Mental health and regret
For: So much of modern life is taxing on the mental health of young people, protecting them from NFT-related financial regret would prevent adding to it.
Against: Your first financial regret is going to hurt whenever it comes, however old you are.
This is a big one. A really big one – and it isn’t limited to young people.
What happens when a project you narrowly miss out on goes on to make money? Whether it makes $100 more than you paid or a $1000 or even a million, there will be regret. There is always regret – regrets if you spend the money and don’t make it back and regrets if you don’t spend it and miss out. There’s regrets if you sell too soon, too late, not at all – regret is rife within NFTs.
And not only that, but that regret is often accidentally-on--purpose rubbed in your face by the people around you in Discord and on social media, so it’s almost impossible to get away from it.
Regret is a bitter pill to swallow however old you are, but young people – who are even more influenced by their peers and feel new things so intensely for never having felt them before – it’s got to be horrific.
On one hand, age restrictions could protect under 18s from this for a little while, but one the other… your first financial regret is going to be awful, whenever you have it.
Nothing to do but think
So, there you have it, just some of the arguments for and against age restrictions in NFTs. However, like I said at the start, getting legislation around age restrictions in the world of crypto would be a huge undertaking. I have no idea where you would even begin, because the whole ethos of crypto is that it’s decentralised and there isn’t a ruling authority. So how could it even be implemented? I don’t know enough about the industry to even discuss it, if you do, let me know! I’m interested.
And even with that in mind, it’s still worth thinking about – if certain projects felt strongly about it, they could build an age restriction into their mint (i.e. only accepting wallets that require identification) and even their secondary sales, if they were really passionate.
For now, it’s worth all of us in the NFT space to take a step back and think about the young people in it with us. How can we be good examples to them? What actions can we take to protect and educate them?
Appendix: Platforms that do require users to be over 18
Coinbase
OpenSea
Axie Infinity (unless given parental permission)
MetaMask (unless given parental permission)
*1 - NFT speak meaning ‘rug pull’, referring to a project where the creators essentially make their money and get out, pulling the rug from under the investors.
*2 - NFT speak referring to fear, uncertainty and doubt – elements that contribute to the decline of projects.