BOSTON — Financial industry experts are monitoring a sharp rise in investment in Bitcoin and other so-called cryptocurrencies, especially among those new to the market.
They say Bitcoin alone became the best producing asset return last year at over 1,000 percent return.
Cryptocurrency is basically digital money traded peer-to-peer with no banks involved.
There are over 2,000 different kinds of cryptocurrencies, but you probably know Bitcoin the best.
It’s very attractive to amateur investors right now and some in the black community see it as an opportunity to close the country’s racial wealth gap.
“If you understand how to you use your CashApp, then you can certainly buy Bitcoin in your CashApp,” said Dr. Shalair Armstrong of Boston, a member of the Black Bitcoin Billionaires group. She began investing in cryptocurrency in 2011.
”So if you can imagine one coin going for less than a penny, when I got in they were 150, 150 dollars for a coin. When I checked today they were going for 48,000 dollars per coin,” Armstrong said.
Armstrong is among a growing group of black investors nationally who see cryptocurrency as a way to fix economic injustice, and urges communities of color to invest in the digital money market as a way of long-term saving.
“Elon Musk who is over Tesla just got into Bitcoin. Michael Sailors in microstrategies just got into Bitcoin. Their Bitcoin is valued as the same as my Bitcoin,” Armstrong said.
”Whites on average have 10 times the wealth of the black community. Why is that? This gap is wider than it was 50 years ago. And the reason is the black community hasn’t had adequate access to capitol,” said Bitcoin expert and Boston University professor Mark Williams.
Williams said the risks associated with investing in Bitcoin may outweigh the rewards.
“We had daily fluctuations of up to 10-, 15-, last week 20 percent either increases or decreases in value, so to an investor, are you willing to loose 20 percent in a given day?” Williams said.
Williams told me a safer bet is to make the banking system better.
“Banks themselves have to be more readily open and available to giving loans to the black community where in the past it has not. That’s Step 1. Step 2 is once you have access to capital is how should you best invest it,“ said Williams.
Armstrong said diversity within cryptocurrency companies has become more important.
Cryptocurrency portfolio tracker Blockfolio recently apologized after messages containing racist slurs were sent to users following an apparent hack.
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