Black Americans disproportionately affected by crypto crash

Black crypto investors in the US have been among the worst impacted by the crypto crash, according to a survey by Ariel Investments and Charles Schwab.

The research shows that one-fourth of black American investors held cryptocurrency assets at the beginning of the year, compared to only 15% of white investors.

The damning cryptocurrency market crash has had broad repercussions for investors across the world, but the survey suggests that black Americans are twice as likely to purchase cryptocurrency as their first investment.

Amid a crippling market crash, the value of these investments has been rapidly dwindling, impacting black investors disproportionately.

The cryptocurrency market capitalization is now just shy of $1tn, compared to $3.2tn at the same time last year.

According to the researchers, black Americans have been tempted by the prospect of building wealth quickly and have seen crypto as a way to close the financial and inequality gap. Many investors also don’t want to be left behind.

The fear of missing out has been far more pronounced among black Americans than it has been with white investors in the country.

Interestingly, a historic look at investor attitudes displays black investors as the more conservative group. The cryptocurrency market has made this group of individuals far more assertive and prone to risk, the Ariel-Schwab survey found.

This probably has to do with the fact that black Americans are more skeptical of the stock market than their white counterparts. This is rooted to decades of discrimination when it comes to the financial system.

The cryptocurrency industry has been able to liberalize the financial market and many black American role models, including Jay-Z and Snoop Dogg, as well as Floyd Mayweather, Jamie Foxx and others, have all piled on, leading to mounting interest.

However, this frenzy has left the group far more exposed to the vicissitudes of the crypto industry.

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Source

Updated: 07/05/2022 — 09:00