The crypto collapse met with great echo in black American investors

The widespread losses caused by the cryptocurrency crashed are even greater for black investors.

According to a survey by Ariel Investments and Charles Schwab, a quarter of black Americans have cryptocurrencies compared to only 15 percent of white investors. Black Americans buy cryptocurrencies with more than twice as likely as their first investment.

The value of these investments has been imploded. The overall market capitalization of cryptocurrencies fell from more than $ 3.2 trillion to less than $ 1 trillion. The decline in digital assets goes hand in hand with a bear market in US shares.

The stronger exposure of black Americans compared to cryptocurrencies made it more susceptible to the financial downturn, even if her households have fewer assets on average.

The attraction of assets increased by marketing pulled many black investors in cryptocurrencies. Bitcoin's dollar price rose by 9,300 percent in November in November.

Jefferson Noel, 27, said he came into contact with crypto for the first time in January 2019 when he accidentally invested $ 5 in Bitcoin while using cash app, a payment service.

"I had no idea what it was and I can't even remember having done it," he said.

Last May, his unintentional investment was worth $ 70. The astronomical profit inspired him to accept the advice of a friend and to invest $ 20,000 of his savings in other cryptocurrencies such as Dogecoin instead of more traditional systems such as index funds.

"[Black Americans] I don't want to be left behind," said Noel. "As far as I can judge this, the Black Community Krypto sees as a way to compensate for the field and to enter the game before the goalkeepers prevent others from participating."

But he now rethink this decision. Persistent losses have destroyed more than 20 percent of its crypto investment. He researches his uncle for investment funds on the advice of his uncle, but still buys more crypto.

In the past, black investors were rather conservative and invested more money in low -risk assets such as insurance and savings letters. According to the Ariel-Schwab survey, black Americans of the stock exchange and financial institutions trust less than white Americans. Further investigations have associated their fears with decades of discrimination in the financial system.

Jatali Bellanton, the author of a curriculum for personal finance, which is aimed at young black Americans named Kids WHO Bank, sees cryptocurrencies as a way to compensate for opportunities for asset construction that were historically not available on the real estate and stock markets.

"We don't want to stay behind when it comes to new technologies," she said.

The promise of cryptocurrencies as a wealthyer was charged by supporting celebrities, sponsorship and advertising.

prominent black Americans, including the musicians Jay-Z and Snoop Dogg, boxer Floyd Mayweather, actor Jamie Foxx and the filmmaker Spike Lee, have encouraged crypto in their communities.

LEE appeared in commercials for the operator of crypto monetary machines Coin Cloud last year said that "old money will not pick us up; it pushes us down" and "systematically suppresses", while digital assets are "positive, inclusive".

Last month, Jay-Z announced a partnership with the former Twitter boss Jack Dorsey to start a literacy program of the "Bitcoin Academy" in the social housing complex in Brooklyn in which he grew up.

Such prominent supporters have been heavily criticized because they were paid to sell risky investments to people who may not have resources to survive the volatility of crypto.

"eight-nine percent of these cryptocurrencies were developed into nothing other than lifting money from the bank accounts of the people," said Najah Roberts, a former financial advisor and founder of the cryptocurrency education center Crypto Blockchain Plug.

"This is not" get rich quickly "," added Roberts. "There are massive targeting ads that are targeting our community."

Bellanton said that there were no advertisements, but the prospect of financial freedom, the lack of the minimum investments that are common for investment funds and the feeling that the distributed main register of blockchain is more transparent than large banks that attract first investors.

"The reason why minorities take over crypto more often than others is that it is much cheaper to send it if they are not already rich [USD Coin, a StableCoin Asset] as a message," said Brian Brooks, managing director of the blockchain company Bitfury, last month at the Aspen Ideas Festival. "It's just cheaper. The entire system is cheaper and faster. It does not have all these entry barriers where you can only get it if you are already rich."

Despite the loss of loss, many black investors remain invested in the market. Dennis McKinley, 41, bought the dip against the advice of his financial advisor. He said that his cryptoma coins now make up about 30 percent of his overall portfolio, which is kept next to stocks.

"The young black America is currently reaching a point where we have freedom to invest in alternative strategies in addition to real estate," said McKinley, owner of a small company in Atlanta. "I think it is important to learn and get out."