The use of cryptocurrencies as means of payment that circumvent the traditional financial system is proving increasingly popular among minority groups in the United States.
According to data from Harris Poll shared by USA Today, 1 in 4 people who identify as LGBTQ have invested in cryptocurrencies. This is almost twice the proportion compared to the U.S. population as a whole, which has a 13% acceptance rate.
The ratio is very similar among Black Americans. About 23% of the total U.S. population of color has some investment in cryptocurrencies.
Among Hispanics, cryptocurrencies are slightly less popular. Approximately 17% of Hispanics living in the United States hold crypto. However, the figure far exceeds the preferences of the white population, which only registered 11% of crypto-investors.
The United States pales in comparison to other countries. Canada, for example, has a 30% of its population interested in crypto investments.
John Gerzema, CEO of Harris Poll, believes that a large part of this phenomenon could be explained by the fact that the financial world also suffers from social discrimination, and minority groups are turning to more inclusive and promising alternatives.
“There has been a long history of discrimination in investments, and that could be why we have seen a wide demography of interest and inclusivity in crypto – because it’s new, open and seemingly has fewer barriers to entry.”
But we’re not just talking about a positive perception toward cryptocurrencies. Tyrone Ross, chief executive of Onramp Invest, says that cryptocurrencies have increased their popularity among black millennials and LGBTQ groups due to the precarious economic conditions in which many of these segments of society live:
“Loss of wages, loss of jobs, all of that was part of my family’s experience … and a lot of it stemmed from traditional financial systems. The government decided to support these large institutions rather than the everyday person. (It) signaled that potentially that system wasn’t created for me (but) cryptocurrency provides accessibility to a new system, more decentralized and (one that) could potentially benefit me, and people like me, in the long run.”
The situation is similar for the LGBTQ community. Yosef Bonaparte, associate professor of finance and the director of external affairs in finance at the University of Colorado, explains that discrimination based on sexuality is a natural barrier that decreases a person’s chances of being attracted to investing their money in the stock market by as much as 40%.
Another critical factor in the growth of crypto-investors in minority communities is the near-zero barrier to entry. While anyone can allocate a minimal portion of their wealth in crypto, many of these low-income individuals feel self-conscious about seeking advice for investment accounts due to the hefty sums of money they tend to ask for as requirements.