During a House Financial Services Committee hearing on FTX last month, Democratic Rep. Jesus Garcia said of crypto, “The whole industry sees itself as above the law. ‘, and continued with more offensive remarks.
Crypto firms “make their money off of hype and hoaxes,” Garcia argued, adding, “When the hoaxes go away, companies go bankrupt, leaving ordinary investors, especially black and Latino-biased latecomers. of low-income earners will suffer,” he continued.
Because of people of color’s aggressive purchases of crypto assets over the past few years, and the likes of Celsius Network, FTX, and Voyager Digital, many of those people are out of money. It is true that we lost
However, at the root of Senator Garcia’s remarks, whether intentionally or not, there are glimpses of an attitude that looks down on specific communities in the United States and around the world as vulnerable due to lack of information, and the independence of such communities. and overlooks the big story of its hidden power.
Top 4 Penetration Rates: Vietnam, Philippines, Ukraine, India
Take a look at the hundreds of black and Latino-led grassroots crypto projects in America and the many crypto-based business models that are springing up in Africa, Asia and Latin America. There are many who are finding new ways to take charge of their lives in marginalized and oppressed low-income communities.
That’s why the top four cryptocurrency penetration reports compiled by blockchain analytics firm Chainalysis are Vietnam, the Philippines, Ukraine, and India, followed by Pakistan, Brazil, Thailand, Russia, and China in places six through ten. ing.
Also, according to a report called “Black Experiences in Web3” to be released by the Crypto Research and Design Lab (CRADL), the United States is the only one on the list at #5. There is also a reason that Japan is a developed country in Europe and the United States. The spread of crypto assets is progressing in the black community in America.
AVOID AN OLD FINANCIAL SYSTEM
A tip for Senator Garcia. Sam Bankman-Fried is not the common denominator of the aforementioned top 10 countries. FTX’s Super Bowl ads aren’t aimed at Vietnamese rickshaw drivers, Ukrainian refugees or black American hospitality workers.
Millions of people around the world are venturing into the world of crypto assets, seeing it as a way to bypass the legacy financial system that has prevented them from tapping into their dormant potential.
Of course, these marginal early crypto buyers are a minority in the community. Crypto assets are far from universal acceptance everywhere. And the negative sentiment caused by the 2022 crash and bankruptcy will slow growth.
However, the trend of global penetration in such communities and groups continues, and in the long term will disrupt vested interests in the financial sector in the West. Those who will be disrupted include the privileged who treated centralized exchanges like casinos that multiplied their wealth by 10x.
A once marginalized minority is now in a position to lead the industry’s recovery.
change from the periphery
I believe the solutions developed by the minority will be the real source of the revolution cryptocurrency technology promises in the Web3 era. It will be different from the Web2 Internet “revolution” that disrupted past commerce infrastructures, with Google, Amazon, Facebook and others shifting Westerners from existing systems to new platform-based business models.
Paradigm shifts come from outside the system – from developing countries and from marginalized communities within developed countries.
After the bursting of the CeFi (centralized finance) trading and lending bubble, it is the locals who have the chance to redefine the purpose of crypto assets and differentiate themselves from the upsurge of empty speculation that FTX has symbolized. And those who bring real-world focused use cases to the community.
A CRADL report on the adoption of cryptocurrencies in the black community cites a startling study by the Kansas City Federal Reserve Bank.
18% of black American consumers own crypto assets, compared to just 7% in stocks and 2% in mutual funds. Meanwhile, 12% of white consumers own crypto assets, 19% own stocks, and 12% own mutual funds.
Trauma across generations
The report explores the root cause of this discrepancy, citing a deep-seated mistrust of white ruling groups in the stock market and financial industry among black American communities. The sense of distrust stems from “economic trauma passed down through generations,” and is also linked to the appreciation of the cryptocurrency story of self-empowerment.
“Transgenerational trauma” refers to the idea that historical injustices against particular races are passed on from generation to generation.
Slavery is a prime example, a source of long-term trauma that has burdened black Americans for centuries with its systemic racism and deep-rooted mistrust.
For those who reject such thinking and want the past to be washed away, Haiti is an example.
The Haitian government, which overthrew its former ruler in the 1804 revolution, was heavily indebted to its former ruler, France. It was supposed to be reparation for the loss of the “property” of the French slave owners.
The debt eventually passed into the hands of Citibank’s predecessor, the National City Bank of New York, and although it was eventually paid off in 1947, it put a century-long burden on impoverished Haiti.
No wonder Haitians continue to be skeptical of Wall Street and open up to Zimbali Networks, a Haitian digital currency payment product.
Super grassroots Web3 innovation
Other cryptocurrency projects that local communities have developed for themselves include projects that participated in the hackathon “Web3athon” co-hosted by CRADL and CoinDesk.
For example, Evolve has developed a Plygon-based financial literacy program for Black, Indigenous and women of color. “IndigiDAO” is an autonomous decentralized organization (DAO) for indigenous communities. The Carbon Coffee Collective is a project that provides coffee farms with funds to convert to regenerative agriculture.
There are also Play-to-Earn (P2E) game co-ops such as the Web3 gaming guild “Yield Guild Games” from the Philippines and its Indian version “IndiGG DAO”.
Leah Callon-Butler, director of crypto-focused consulting firm Emfarsis Consulting and CoinDesk columnist, describes such communities as “super-grassroots, community-oriented, Web3 innovation excellence. It is called “example”. According to Caron-Butler, there are already 17,500 such Web3 guilds in the world.
Caron-Butler further pointed out that Impact Market, a protocol created for communities developing projects with financial inclusion and social impact, is a tool to advance grassroots empowerment projects in developing countries.
Beyond technology and financial innovation
These tools and ideas are sparking innovations tailored to local needs everywhere.
Decentralized finance (DeFi) innovation has exploded in Nigeria, with local developers fed up with inflation and a corrupt and oppressive government developing ways to bypass the formal financial system.
Related article: Money and Crypto Situation in Africa’s Largest Country: The Real Identity of “Megasley”, Which Runs Nigeria’s Only Bitcoin Lightning Node
The NFT also offers black artists and other historically underrepresented artists to sell directly to collectors, avoiding the exclusionary practices of the pretentious art professionals in the white-controlled gallery world. offers an opportunity.
What’s striking about these projects is that they go beyond technology and financial innovation. It is a social innovation, exploring ways for communities to unite through common and individual interests using new governance models and tokenomics.
As the number of such projects increases, they will become a challenger to the Western centralized system.
It won’t change everything overnight, but it will be a slow, quiet revolution. The impact will eventually lead to something as trivial as FTX going bankrupt.
｜Translation and editing: Akiko Yamaguchi, Takayuki Masuda
｜Original: Worldwide Grassroots Projects Can Lead Crypto Recovery