The digital landscape of investing is shifting rapidly, and Australia’s top financial watchdog is sounding the alarm. According to a recent study by the Australian Securities and Investments Commission (ASIC), a significant portion of Gen Z is turning away from traditional advisors and toward social media and artificial intelligence to manage their money. With crypto ownership among 18-to-28-year-olds hitting 23%, the regulator is concerned that “unreliable sources” are leading young Australians into high-risk traps.
ASIC’s Moneysmart research highlights a growing disconnect: while young investors crave trustworthy financial content, they often settle for whatever the algorithm serves them. This has led to a culture where engagement-driven “finfluencers” and AI chatbots are seen as more accessible than licensed professionals, despite the inherent risks of misinformation.
The Rise of the Finfluencer and the Trust Gap
Social media has become the primary classroom for financial literacy, with 63% of Gen Z using platforms like TikTok and Instagram for guidance. Even more concerning for regulators is the level of blind trust; 52% of respondents said they trust “finfluencers,” many of whom lack the legal licensing required to give financial advice. Last June, ASIC took action against 18 such influencers suspected of promoting high-risk products without a license.
The danger isn’t just about bad stock tips. ASIC Commissioner Alan Kirkland noted that many social media ads lure people into switching their superannuation—the $4.5 trillion retirement pool—into volatile or even fraudulent investments. Because super is often a person’s most valuable asset, being “lured in” by an unlicensed personality can have devastating, lifelong consequences for a young person’s retirement savings.
AI Chatbots: The New (Unlicensed) Financial Advisors
Perhaps the most startling discovery in the survey is that 64% of Gen Z trust financial information provided by Artificial Intelligence (AI)—ranking it as the most trusted source of all. As crypto exchanges integrate AI “trading partners” to offer personalized guidance, ASIC is making its stance clear: if an AI tool makes specific recommendations based on individual circumstances, it is legally considered personal advice and requires a license.
As we move through 2026, ASIC has identified the exploitation of licensing “gray areas” by AI and crypto firms as a top priority. The regulator warns that while AI is convenient, its accuracy depends entirely on its source data. For young investors, the message is simple: a chatbot might be fast, and an influencer might be relatable, but neither can replace the legal protections and accountability of a licensed financial professional.
