Bitcoin (BTC-USD), the number one digital currency first introduced in 2009, raised eyebrows this week when it fell below $40,000 for the first time in three months, sparking fears of uncontrolled volatility. But by Wednesday, the price of the coin had surged again to $43,000 and many financial leaders predicted that Bitcoin would surpass $75,000 before the end of the year.
The rapid recovery of many crypto enthusiasts has proven that Bitcoin is here to stay. Now, some investors are highlighting Bitcoin for the opportunity it offers to level the playing field, especially for black Americans, many of whom have been disenfranchised by traditional banks for decades.
“Bitcoin is definitely a tool for social justice,” Charlene Vaderboe, a former director of audit at the Federal Reserve turned bitcoin consultant, told Yahoo Finance. “If you think about black Americans, we think bitcoin allows it.” [us] To build the wealth of generations. And it’s not just black Americans… Latin Americans, LGBT communities, Indigenous communities. It allows societies to build wealth in societies that were left outside the discriminatory banking system we have today.”
Faderepo described 2021 as the “year of the hack” for bitcoin, noting that major banks had high net worth clients investing in them, and large companies began accumulating bitcoin and holding it as an asset. At least seven major banks, including CitiGroup, JP Morgan & Chase, and Morgan Stanley, have made significant investments in Bitcoin.
“The big picture is very bright for Bitcoin,” said Faderepo, who in 2019 founded Guidefi, a micro-tech platform that aims to make it easier for women and professionals of color to find their perfect financial advisor. “If you look at Bitcoin on a 10-year basis, it has had an annual return of 200%, and if you look at Bitcoin in the last two years of this pandemic era, Bitcoin has returned 400%. Gold has a return of about 15% and the S&P index is 42 %. So these are amazing returns for any type of asset class and amazing returns for Bitcoin.”
“I’ve seen the FDIC and the Fed working together to guide the internal agency and we expect to see more and more movement and more regulatory clarity,” she added. “And as we know when regulatory clarity is here, it builds trust, builds security, encourages more people to invest and hopefully more institutions to invest.”
Many marginalized Americans see Bitcoin, the larger umbrella of cryptocurrencies, as an opportunity to finally seize control of their future success, absent any kind of government intervention.
“What we really need to do is now leverage the technology behind the blockchain to improve the quality of life for our people,” Christopher Mapondera, co-founder of BillMari, the largest pan-African bitcoin wallet provider that uses blockchain technology, told TIME. last fall.
After 400 years of slavery in America, and decades of struggle for civil rights, the racial wealth gap in the United States remains stark. According to 2019 Federal Reserve data, the average net worth of a white family was $188,200, nearly eight times the median net worth of a black family of $24,100. Unequal access to credit and loans, the generational effects of red lines and a lack of banking in black communities all played a role in the wealth gap.
Progress toward equity in these areas for the most disadvantaged communities has been slow, but many black Americans see coding as a key opportunity to correct the course. In fact, a recent Harris poll found that one in four black Americans own a cryptocurrency, surpassing any other race in America, including white Americans, at a ratio of 3 to 1.
Brandon Buchanan, founder and managing partner of Meta4 Capital, an investment management firm focused on crypto, is one of the leading black crypto investors who see promise in the space.
“Blacks in particular are closely related to culture,” Buchanan told Yahoo Finance last month. “If you think of the internet and you think of memes, all you have to do is check the slang. Check what’s going on in the culture, the music and certainly blacks are on top.”
Fadirepo ultimately believes that women of color, especially black women, will lead the Bitcoin revolution when all is said and done.
“Women of color are the fastest growing group of entrepreneurs in the country,” she said. “We are very focused on moving women from financial health to financial wellness to financial independence. We hope and … believe that Bitcoin and investing in Bitcoin are going to be a huge part of this story for the average black woman and woman of medium color.”
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