Cryptocurrency can give African Americans back economic ground

Crypto skeptics are on a winning streak as digital asset prices tumble and layoffs sweep the sector.

For minority communities across the country, the downturn in the digital currency market is a missed opportunity for financial independence. Bitcoin and decentralized finance offer people who have long been denied equal access in the traditional banking system the opportunity to build investment portfolios, share for their families in the financialized economy of the 21st century.

With inflation hitting 9%, gas prices soaring and a recession looming, many African Americans have lost ground economically. This poor economic situation has been exacerbated by the pandemic and is leading the community to seek financial opportunities. For many, crypto filled the void.

Many in the black community understood the importance of this new technology. A recent industry survey shows that a quarter of black investors own cryptocurrencies, compared to just 15% of white investors. Najah Roberts, the African-American “Queen of Crypto,” launched a nationwide financial awareness campaign to educate retail investors about the promise of these new assets. Their campaign, titled The Second Annual Digital Financial Revolution Tour (DRFT), reached out to 41 urban communities across the United States. From Los Angeles to Brooklyn, Las Vegas to Boston, Roberts’ DRFT has sought to positively transform the financial mindset and path of economically disenfranchised, middle-income people of color.

One would expect America’s leading financial institutions — with their grandiose statements promoting equity and inclusion in finance — to bemoan the declining value of crypto and the impact it will have on minority investors. Instead, the big banks seem to be cheering him on.

Big banks and their financial regulators are feigning concern about average investors to undermine public support for cryptocurrencies. Regulators from the Securities and Exchange Commission to the Federal Reserve have managed to block responsible cryptocurrency companies from gaining a foothold in this space — while allowing speculators and scammers to proliferate.

For Americans looking for alternative investment opportunities, regulators’ failure to approve more solid companies to operate in the crypto market has pushed investors into the hands of irresponsible actors — or back into the relative safety of the devil they know in the form of traditional, centralized finance that left American communities cold-blooded for decades.

Anyway, it’s the banks that stand to benefit: remember, many Wall Street firms are sitting pretty while Main Street investors are flipping it on its head. Some even make profits by betting against cryptocurrency trading companies. As The New York Times recently put it, “In the great cryptocurrency bloodbath of 2022, Wall Street is winning.”

With cryptocurrency prices trending lower, this should be a time for regulators, industry executives, and thought leaders to reflect on the mistakes that have led to this painful market downturn. Instead, many are taking the opportunity to besmirch an existential threat to the status quo.

Analysts from elite financial firms and academic institutions have been making the rounds in the mainstream media to tout the apparent demise of cryptocurrencies. “The tide has receded in crypto, and what we’re seeing is that many of these companies and platforms are resting on shaky and unsustainable foundations,” Lee Reiners, a former Federal Reserve official and frequent crypto skeptic, told the Times.

Of course, the same could have been said of the big banks whose reckless behavior culminated in the global financial collapse – the same banks that received an unprecedented bailout at taxpayer expense; whose alumni now have advisory boards at institutions like Duke Law School’s Global Financial Markets Center, which Reiners chairs.

There is no doubt that speculation in the crypto markets has gone too far and that a correction is healthy. There are many reasonable voices calling for a more responsible regulatory framework that will allow the burgeoning industry to thrive. These proponents, voicing constructive criticism, stand in stark contrast to the perpetual cryptoskeptics, who are more interested in reflective reproaches than necessary reforms.

Expanding cryptocurrency education can help foster financial literacy — and ensure responsible players win in the battle for crypto’s future. DFRT is one of several efforts to educate the public about the responsible use of cryptocurrency technology.

CoinAgenda, a global conference series connecting blockchain and cryptocurrency investors with startups, and BitAngels, a network of bitcoin and blockchain investors, plan to convene conferences in Las Vegas and Puerto Rico later this year to further these goals. The Congress of Racial Equity encourages these efforts to increase Americans’ understanding and awareness of crypto

Those rushing to take down the cryptocurrency industry should consider who will be most affected by the bursting of the Bitcoin bubble. Anyone who hears them should consider who benefits from them.

• Niger Innis is the National Chair of the Congress for Racial Equality.

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