Band Sabrina Lynch
- 23% of African Americans own cryptocurrency and 44% of investors of color also own it
- Cryptocurrency market triples in less than a year, from $770 billion to $2.7 billion
Black-owned businesses and their finances have been disproportionately impacted by COVID, but now the tides are turning as this demographic uses the technologies behind blockchain to own the cryptocurrency market. Slightly less than one in four, about 23%, of blacks have this cache currency, compared to 11% of white Americans and 17% of Hispanics. Last year, about 13% of black households in the United States were unbanked, which left them financially vulnerable. Cryptocurrencies offer a new, decentralized financial model for black communities to grow their own wealth, after being ostracized for so long by traditional banking institutions.
Why it matters: The number of crypto investors is set to double with the emergence of a new generation of black traders, with 44% of cryptocurrency traders being investors of color. Additionally, there has been a steady increase in non-traditional investors, those without college degrees or professional training in finance, turning to crypto to escape the barriers created by traditional banking methods.
African Americans hold only 3.8% of the $116 trillion in wealth in the United States, which puts them at a severe disadvantage in closing the racial wealth gap. Cryptocurrencies offer people of color the same opportunities to contribute and gain value in a diverse financial market. The rules of the game have been leveled, at least in part, which comes just in time as the crypto market cap hit a record high of $2.7 trillion.
For example, blue-collar teachers are leveraging the internet to access forums that hold valuable knowledge to put them on a level playing field on the financial ladder. Recently, Black Bitcoin Billionaire, an organization focused on promoting inclusion and diversity in the Bitcoin space, received a $150,000 grant from cryptocurrency exchange and bank Kraken to support minority communities. This is good news for black women who are the fastest growing entrepreneurial demographic in America, and they could one day have immense disposable income.
Situational awareness: Bold steps are being taken by the black community to make up for lost financial time. The decision to embrace cryptocurrency was shaped by nearly 24 months of self-navigation through a global health crisis and economic upheaval, forcing African Americans to reclaim their economic power through lucrative investments in the crypto market trading.
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