On Tuesday, May 3rd, 2022, I got an email inviting me to a panel called, “Closing the crypto gender gap”.
“Twice as many men as women invest in crypto. And it’s time we stop feeling like new kids on the block(chain),” it said. The implication? Cryptocurrency could close the gender wealth gap and by not investing in cryptocurrency women are missing out.
Just over a month later, cryptocurrencies plunged, with Bitcoin, the most popular cryptocurrency, losing more than 50% of its value since the start of 2022.
Women weren’t the only ones targeted with cryptocurrency marketing through the framework of equity. Black Americans similarly report cryptocurrency being positioned as way to even the financial playing field following a long-history of discriminatory policy, bias, gatekeeping and exclusion of Black Americans from equal access to financial services, real estate, employment, and other wealth building tools. The promise of cryptocurrency as a way to push back against these historic economic inequities and achieve financial freedom was amplified by high profile celebrity endorsements, like Spike Lee’s CoinCloud commercial:
“Our currency is not current. Old money—as rich as it looks—is flat-out broke […] They call it green, but it’s only white. Where’s the women, the Black folks, and the people of color? […] Old money is not gonna pick us up. It pushes us down. Exploits. Systematically oppresses […] New money is positive. Inclusive. Fluid. Strong. Culturally rich. Where status is anything but status quo.”
A new survey from Ariel Investments and Charles Schwab points to the impact of this messaging, finding that while Black Americans are less likely than white Americans to own stocks, they were more than twice as likely to purchase cryptocurrency as their first investment. The survey also found that a quarter of Black American investors owned cryptocurrency, compared to just 15% of white American investors, leaving Black American investors disproportionately hit by the recent collapse in cryptocurrency values.
In other words, cryptocurrency hasn’t helped close the racial wealth gap, but made it worse.
This is not to say that Bitcoin and other cryptocurrencies might not rebound and prove to be a practical financial tool or lucrative long-term investment, but only for those who have the time and resources to weather crypto’s volatility.
Based on what we know about the persistent racial and gender wealth gaps in the United States, those being targeted with the promise of cryptocurrency as a great wealth equalizer are the least likely to have the resources to be able to realize that promise – if that promise is even realized.
And yet, a similar marketing effort has unfolded across spaces dedicated to “empowering” women. In a must-read Washington Post column, Nitasha Tiku describes the recent movement and its messaging:
“Gwyneth Paltrow and Mila Kunis joined a Zoom in January to encourage 5,000 women in the audience to break into the male-dominated world of crypto. “We have watched a lot of these bros get together and earn a lot of money,” said Paltrow, sporting a black turtleneck, sun-kissed glow and a disarming smile. “We deserve to be in this space just as much.” […] Like the girlboss, these NFT brands mix hustle culture with the language of social justice, blurring the line between community and commerce, and dangling empowerment as a customer acquisition strategy.””
As a writer covering money, work and wealth through the lens of gender, I’m intimately familiar with this language, and find myself grappling with both its promise and its problems. On one hand, the consequences of women, people of color and other marginalized communities, holding far less wealth than their counterparts is clear, and connecting those individuals to resources, tools and community to better access and build wealth feels important. On the other hand, I know the most meaningful ways of addressing these inequities – a livable wage, equal pay, paid parental leave, affordable housing, healthcare and childcare, etc. – require major systemic changes. These are not simple, accessible solutions any individual with a smartphone and a bank account can execute in a matter of minutes. And so at the end of nearly every story or interview or column I report, I find people asking, “So what can we do?”
And while trying to address the pitfalls of capitalism with more capitalism can feel simultaneously hopeful and hypocritical, never have I found myself responding to the question of what we can do about the wealth gap with any iteration of “buy cryptocurrency.”
At least on an individual level, paying off debt can foster financial stability, building savings can protect against unexpected economic shocks, and investing in a diversified stock market portfolio, though not risk or volatility free, has a track record of being one of the most reliable ways to build lasting, long-term wealth, but the financial upside of cryptocurrency still feels largely speculative, while the downside risks are real and painful.
For those communities whose risk capacity is already limited by unequal pay and access to capital, a speculative investment like cryptocurrency isn’t a risk most can afford to take. And the message that “rolling the dice” on cryptocurrency is the only way for these communities to gain some semblance of equal financial footing, just goes to show how urgently systemic solutions to wealth inequality are actually needed.