As the blockchain continues to lead fresh frontiers in finance, diversity critical. It’s crucial that all demographics are represented as both the leaders of this change and the consumers of it.
However, the worlds of finance and tech are predominantly white and male—and fintech, the innovative collision of the two, is no different. This includes the blockchain, which is desperately devoid of diversity.
More specifically, the proportion of women in leadership positions at financial firms is just 21.9 percent and, by 2030, is only projected to reach 31 percent if it sustains its pace. Meanwhile, women make up just 28.8 percent of the tech workforce. As for fintech founders, females are few and far between, accounting for just a mere seven percent.
That’s why it comes as no surprise that the blockchain—a decentralized ledger system that records digital assets’ provenance—is painfully homogeneous. According to a global Quartz survey, of 378 venture-backed cryptocurrency startups that were founded between 2012 and 2018, only 8.5 percent had a female founder or co-founder.
“‘Where the Boys Are’ isn\’t just a great Connie Francis song; it’s also a breathtakingly accurate description of who invests in cryptocurrencies,” Duncan Stewart, Deloitte director of research, wrote in a 2017 LinkedIn post aptly titled, “Is Bitcoin a bubble? Gender split says probably.”
Twice as many men as women invest in crypto (16 percent vs seven percent) across all racial and ethnic groups. In fact, 85.77 percent of folks who are involved in the bitcoin community are men. Research suggests that 62 percent of cryptocurrency investors are still white and 67 percent are still men.
Some organizations are working to create change from which the industry (and society, at large) would indubitably benefit. For example, online cryptocurrency educational platform, Crypto Tutors, recently made headlines for organizing the first-of-its-kind Crypto Diversity Conference: Crypto for the Culture in early October. Topics included crypto for black economic empowerment and women of color in blockchain tech. The conference was a welcome respite from the 2018 North American Bitcoin Conference, which a New York Times article dubbed a bunch of “blockchain bros.” According to the article, only three of the 87 speakers were female. What’s worse: The official conference party took place at a strip club in Miami.
Meetup groups like Women in Blockchain are also cropping up to raise awareness about the criticality of diversity on the blockchain. The Black Women Blockchain Council offers resources for Black women like diversity and inclusion mentorship, training and development programs, visibility initiatives, and networking opportunities. And the National Policy Network of Women of Color in Blockchain group advocates for and empowers Black women in the crypto ecosystem, partnering with blockchain enterprises, institutions and the private sector to promote women building products and services on the technology. Its mission is to “ensure the voices of innovators of color are part of the policy debate regarding the emerging crypto economy.”
After all, cryptocurrencies like bitcoin, ethereum and dogecoin, for example, could democratize the traditionally white- and male-dominated field, welcoming diverse innovators and investors and spreading the wealth.
Moreover, the blockchain can help solve societal issues in less obvious ways–from confronting climate change to solving world hunger and even supporting victims of domestic abuse. According to the National Coalition Against Domestic Violence, up to 99 percent of victims of domestic violence are also victims of economic abuse. In other words: Their abusers restrict their access to their finances, which is often what keeps many of them in these abusive relationships. But because crypto is anonymous, with finances connected to keys instead of names, stories are cropping up left and right of survivors who traded digital assets to dig themselves out of hairy situations.
As it stands, only about one in 10 people in the U.S. invest in crypto. That means that there’s about nine in 10 people across all demographics who can still get started somewhere—with the right resources from the get go.
One reason why people in minority groups may not be so enticed to invest in or enthusiastic about crypto is because they’re adversely affected by the risks that come with it. Already, women—and Black women, in particular—face more financial insecurity than their white male peers. One study, titled “Risk and Reward Are Processed Differently in Decisions Made Under Stress,” suggests that “stress amplifies gender differences in strategies during risky decisions, with males taking more risk and females less risk under stress.”
An obvious way to alleviate stress is with education. Because the crypto universe is still so new, with infinite room for growth, there’s ample opportunity to inject diversity into it at its foundation.
While the investing landscape at large is plagued by systemic exclusion, crypto still has a chance to do it right. This involves giving female founders and people of color the space to innovate with inclusion—inclusion of the end-users they represent. It involves passing the mic to all kinds of crypto gurus at conferences. And it involves providing accessible educational resources to all investors.
Otherwise, the lack of diversity means that swaths of people will face massive opportunity losses. Again.
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