Are cryptocurrencies getting more diverse?

Part of the promise of cryptocurrencies is opening up financial opportunities and services to underprivileged populations, but the digital asset industry has been far from diverse. Financial advisers and the digital asset industry have a lot in common. They both deal with investments, technology, and the needs, wants, fears, and concerns of people everywhere. But they also share an unfortunate lack of diversity.

This article originally appeared in Crypto for Advisors, CoinDesk’s weekly newsletter that defines cryptocurrencies, digital assets, and the future of finance. Sign up here to receive it every Thursday.

Only about one in five financial advisers are women, according to the CFP Board. As an anecdote, after years of talking to people in space, I have only come across a handful of women in leadership positions in the digital assets industry. Now this may be as much the fault of technology as it is of finance because diversifying technology in terms of gender and race has been a decades-long struggle, just as it has been in the financial industry. Perhaps the digital asset industry has inherited one of the worst attributes of both worlds: the relative lack of diversity of its participants.

A Diversity Problem in Digital Assets This is not a new world – blockchain and crypto are just part of it, said Jacob Mullins, managing director of Shasta Ventures, an early-stage venture capital firm active in the blockchain space.

Mullins, who was born in Guadalajara, Mexico, is actively striving to diversify the venture capital industry. “This is a problem endemic to the technology industry, the venture capital industry and the financial industry that will not and should not persist. We are actively trying to fund founders of all diversities, be it gender, race, or otherwise, but is there a magic wand we can wave to fix the problem? Unfortunately not. It has to be a daily focus. ”

Mullins believes that the entire economy could be rebuilt with blockchain technology, presenting a new frontier that could be populated by a much more diverse mix of peoples than the traditional economy. But that border is closing fast, and so far the first stakeholders have been far from diverse. By educating new venture capitalists to promote more Black, Latina, and female founders, Mullins believes she is supporting pioneers who can help open these spaces to more diverse populations.

These are not simple one-off solutions, it is about creating a sustainable system and a sustainable engine where these groups can be promoted as investors, and then that will also enable the entrepreneurial base, ”said Mullins. “It’s like creating a new node that you can then invest in people who resonate with them. There are many business initiatives aimed at the various founding groups; We partner with various venture capitalists and other organizations that promote them. This is how we make practical, everyday changes. ”

This is a problem that women in crypto also acknowledge, particularly women of color, businesswoman Tavonia Evans told Reuters last month, pointing to the difficulty women have both generating capital and raising awareness. There are quite a few female leaders in the crypto space who are highly respected, have great influence within the space, and have credibility with policy makers, ”Evans said. “His successes should attract other women to crypto.

Diversity is key to the success of cryptocurrencies Greater diversity often correlates with better financial performance and a better mix of ideas in finance. For those of us who invest in digital assets, it is even more important. If we allow many women and minorities to be excluded from participating in digital assets, we will accelerate both the potential growth of our communities and the value of our assets.

But part of the sale of crypto assets has always been its benefit to diverse and disadvantaged communities, providing financial services to the unbanked and potentially eliminating a parasitic secondary financial system, such as payday lenders, that has long fed of the working class. If these communities do not have access to digital assets and have no interest in their success, some of the social potential of cryptocurrencies will be lost.

I am not the only one who warns of the problem of diversity in digital assets. Athan Slotkin, an investor, serial entrepreneur, and business plan strategist, pointed out the lack of diversity in cryptocurrencies, describing a “crypto brother culture” that may be shutting down parts of the industry to women and minorities.

I wouldn’t call it the toxic boiler room sibling type of culture, but it is 95% masculine, and all characteristics and interests tend to skew men, creating a difficult environment for women to enter, “said Slotkin “It seems uncomfortable, it’s a fast-moving, intense and very aggressive community, that just means it doesn’t create a very welcoming environment.

Although individuals are welcoming, outsiders have a harder time finding support, information and funding to launch their own ideas using digital assets or blockchain technology, Slotkin said. You have to think that as the world becomes more blockchain-oriented, as women make more purchasing and financial decisions than men, we probably want to make sure that women are represented, he said.

Slotkin has also noticed a lack of diversity in the non-fungible token (NFT) universe, where the majority of artists and collectors tend to be male. I believe that we must consciously invest in women’s projects and help them build communities in their projects, ”she said. “Even if we are not the target audience, sometimes we can support and leave behind the women in the community.

Women-led projects include Evans’s guapcoin, a cryptocurrency aimed at raising the economic profile of African Americans; Lightning Labs, a women-led company that creates smart contract technology; and the Bancor Protocol that establishes convertible “Smart Tokens” that are governed by smart contracts. And women like Ark Invest’s Cathie Wood, serial executive Blythe Masters, and former Binance.US CEO Catherine Coley have long been betting on women’s right to a slice of the digital asset pie.

Groups such as the National Network for Women of Color on Blockchain Policies, SheFi, and Women in Blockchain are also working to close the cryptocurrency investment and business gap. There is a lot at stake. If women don’t embrace digital assets as soon as possible, then they miss out on the best opportunities for gargantuan returns, likely widening a persistent global gender wealth gap.

Both Mullins and Slotkin argue that the digital assets space needs its own version of Girls Who Invest and Girls Who Code, two nonprofits that work to educate school-age girls in communities and foster interest in women. finance and technology in hopes of creating more gender parity. . The industry is moving forward But Slotkin said the industry also needs to reposition itself to attract more diverse groups.

How do you really get more women into finance and technology? It is necessary to start with examples of successful and pioneering women, ”she said. “Grassroots initiatives must start to happen. We need more products and positions that represent different types of people. It would not be okay to try to make something that is interesting to women in general, but rather products that appeal to a variety of diverse people.

The best way to do this is to have diverse people who actually create those products. Men do not know what it is to be a woman. We need women to design products and execute projects, and the same goes for any other group in the country.

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