POC and LGBTQ Investors Favor Bitcoin and Other Cryptos

Crypto investments represent a new way to build wealth outside of traditional financial institutions for many investors historically swept aside by the financial industry, USA Today reports. 

For people of color, cryptocurrency can represent a way to build and hold wealth without engaging in institutions that have historically excluded or exploited them.

23% of Black Americans and 17% of Hispanic Americans own cryptocurrencies, compared to 11% of White Americans. Additionally, half of Black and Asian Americans and nearly half of Hispanic Americans are familiar with cryptocurrency, compared to 37% of white Americans. 

LGBTQ people are also much more likely to own crypto. One-quarter of LGBTQ Americans report owning crypto, compared to 13% of the general public. 

People in marginalized groups may seem drawn to crypto because they feel mistreated by the banking and loans industry and unwelcome in traditional financial institutions. 

Racial and societal barriers have affected individuals in marginalized communities from prospering for decades. For many years people of color, have been denied mortgage services due to financial redlining. This prevents them from buying homes in many neighborhoods. 

Blockchain and crypto have fewer barriers to entry and cost less than some banking services. This makes them appealing for unbanked households. Although only 6% of U.S. households are unbanked, a record low, Black and Latino households are disproportionately affected. 

Many unbanked households cite lack of funds needed to open and maintain accounts without incurring fees as well as mistrust of the government and financial institutions as their reasons for being unbanked. 

People of color, women, and LGBTQ people are all less likely to participate in the stock market. When they do, they are less likely to make risky investments, which can impact their ability to build wealth. 

Crypto can provide investors with the sense that they are on an equal playing field for the first time in their lives. Information about crypto can feel more accessible, particularly for younger generations who are able to access information via social media. 

However, cryptocurrency can be significantly more volatile than more traditional financial products, exposing investors to more risk. 

Experts, as always, recommend portfolios with diverse assets in order to decrease risk.

For more news, information, and strategy, visit the Crypto Channel.