Bitcoin Is for Everyone
In this article, we discuss how crypto helps marginalized groups access capital and break down barriers to financial inclusion.
Racism Seeps Into All Corners of Life
Racism is more than intentional discrimination. It's also a system of institutional policies and social norms that put people of color at a disadvantage. Systemic racism runs rampant through our institutions, from education to employment to housing to health care. There's a shortage of people of color in leadership positions in almost every field, and this lack of diversity leads to policies and practices that don't create equity in our society.
There are many reasons why people of color don't have the same opportunities and access. But in conversations around systemic racism, the financial system is rarely the topic du jour. It's a strange omission because the financial system—of wealth creation and monetary policy—dramatically affects the lives of people of all races around the world. From a systemic perspective, it is one of the most prominent players behind the lack of economic opportunities among people of color.
Wealth creation throughout modern history illustrates this in irrefutable fact. Countries were built on stolen land, labor exploitation, slavery, and genocide of native populations. But even after the more transparent forms of these abuses became illegal, a kind of financial racism stayed alive and well. The system became more sophisticated as time passed, through Jim Crow and onward, but the idea remained—financial resources have been and continue to be concentrated within other populations.
It’s About Who’s In Control
Other race groups create and oversee a disproportionate amount of capital in global financial markets. The financial control creates a racial monopoly on wealth creation and perpetuates a stratified racial hierarchy, distorting the free market into one that is skewed against people of color. You follow the money, and little by little, this advantage bleeds into other aspects of society, effectively limiting opportunities for people of color downstream.
You don't have to search very far to see the innumerable wealth barriers people of color experience and, more damaging, the ways that banks and institutions cause direct harm to those communities through predatory lending practices. During the 2008 mortgage crisis, Black Americans were given subprime loans in dangerously high numbers. These risky policies created ticking time bombs, ultimately leading to outsize home foreclosures in these communities.
On the banking front, a 2019 study by the Board of Governors of the Federal Reserve reported that only 54 percent of Black Americans and 68 percent of Hispanic Americans were fully banked—compared to 86 percent of White Americans. For the banks, it's less profitable to operate in Black and Hispanic markets, so they choose to leave them out, creating communities detached from their wealth sources. For these marginalized groups, financial support from banks can be a matter of life and death, as most banks won't give loans for individuals to start businesses or buy homes. And the loans they do give—payday loans, cash advance loans, and more—charge extremely high-interest rates that often cripple a borrower's ability to escape an endless cycle of debt and credit score degradation. Banks have perfected these vicious-cycle poverty traps, and it's all perfectly legal.
Three Reasons Why Banks Will Never Change
The financial system, so deeply entrenched in the landscape of Western society and so tightly intertwined with all other institutions of power, cannot be drastically changed. Small, incremental changes through bureaucratic policymaking can't possibly fix what's so profoundly broken. This is for three main reasons:
- Institutional policymaking is too slow: and does not have the urgency required to enact tangible change. There's no way for millions of underbanked people of color to acquire wealth in a system that blindly prioritizes funding for privileged groups. There's no incentive or urgency to take the rapid change one needs, especially when the standard policymaking methods involve endless meetings, research, and consultations that drag on for years.
- The path for this systemic change is seen as too politically dangerous: In the U.S., putting forth the idea of doing away with complex financial instruments, including the very banking system that created these problems, to begin with, is tantamount to political suicide. The bureaucracy is controlled by bankers actively involved in the financial industry. The extent of the political influence of finance is so deep that candidates who run on a platform of systemic change never actually follow through with their policy plans when elected. You can't trust a politician to put any real effort into systemic change. Keeping promises is smoke and mirrors for votes.
- The banking industry is too large and complicated: Overhauling a system of this scope would take generations and hundreds of billions of dollars, with little chance of success. Banks thrive on Kafkaesque government regulations, which they help create because it gives them a massive level of quasi-legal immunity. The more complicated they make the system, the more difficult it is for the public to understand it. Fighting it would be like cleaning up an oil spill with a Dixie cup and a wet napkin. There's just no way, and banks know it—it's by design.
We Can't Change the System; We Have to Create a New One
Bitcoin doesn't exist to change the system. It exists to create a new one. In fact, fixing it is its raison d'être. The Bitcoin community has built an entire ecosystem that provides an alternative to money that works on a public ledger, with public distribution of wealth, without the monopolistic chokehold of banks and traditional financial services. While bitcoin companies interface with existing financial infrastructure, this is not the standard in the bitcoin world. Bitcoin projects have created exchange networks where anyone can create and trade freely. They've created complex and detailed smart contract platforms, which they use to transact peer-to-peer, freeing themselves entirely from the threat of government interference.
Bitcoin makes big banks redundant. The individual in Detroit who's been locked out of the banking system can now have money that works for them. This person can't get a bank account, can't get a loan, and has no line of credit. They can't get any credit or debt assistance from the private market, and they have no hope of getting a loan from the public sector. They are stuck in this situation—but bitcoin provides hope. Bitcoin provides peer-to-peer access and transactions in a wholly digital environment, completely free from the traditional financial system. You no longer have to be wealthy and well-connected to benefit from our banking system. All you need is a smartphone (83% of the world has one) and the desire to have economic power in a way no one has seen before.
Equal access to money is not a privilege; it's a right. Wealth creation, monetary sovereignty, and financial stability should not be a pipe dream—they should be a reality.
This is the promise of a decentralized monetary system. With crypto—and Bitcoin in particular—we remove control and power from the equation. There aren't any closed-door meetings about monetary policy, no bankers on board with the plan, and no entrenched lobbyists ensuring their interests are protected. Monetary policy is code. It's all predetermined. No human input can alter the system, and no humans can change the predetermined outcome. It's a system that can function honestly, without political interference.
And the best part? It works the same for the disadvantaged as it does for the privileged, for someone in Nigeria as it does for someone in the upper crust of New York City.
This is a first in the history of humanity.
Everyone in the entire world has the same access to money, the same terms and conditions, and the same policies. The racial strata, the socioeconomic hierarchy, the specific country—none has a bearing on your access to money.
Ultimately, creating access is what bitcoin is all about. It's about creating an ecosystem that provides financial freedom, stability, and prospects to those previously deprived of it. It's about making the world a fairer place. The red tape, the discrimination, and the bigotry people of color face within the financial system don't need to exist. It doesn't need to be something we feel helpless to fix, succumb to, or ignore.
Bitcoin Beats Banks' Three Reasons
As discussed above, we can't fix banks for three main reasons—policy-making is too slow, change is politically dangerous, and the banking industry is too structurally complicated.
But bitcoin subverts each of these reasons.
Policy-making is too slow: Bitcoin’s monetary policy is code. It's all predetermined. No human input can alter the system, and no humans can change the predetermined outcome. Individuals can self-custody their bitcoin or choose to use a provider (e.g., a non-custodial app like NOAH) that meets their specific security needs—and these choices can be made quickly and without extensive red tape. The technology is already here, and we don't need policy changes to give everyone access to money.
Change is politically dangerous: Bitcoin doesn't need political approval to change or update—the code does it automatically. And as previously discussed, bitcoin has no intention of changing the financial system; it only wants to provide an opt-out for those who feel locked in by the current system. It's its own system, with its own rules, built on trustless consensus. Bitcoin doesn't need politicians for it to work—in fact, it works better without them.
The banking industry is too structurally complicated: Bitcoin is structurally straightforward. It's decentralized, global, open-source, and permissionless. You don't need a bank account to use; you don't need to jump through complicated hoops, provide privacy-compromising information, or pay high fees for the banks' compliance costs. Bitcoin is easy to use, and anyone can access it. The structure of bitcoin is anything from complicated—if you have an internet connection, your bitcoin is instantly in the palm of your hands.
Bitcoin has the potential to create a more inclusive, racially equitable playing field—but it's not going to happen overnight. It will take time, education, and effort to get people of color involved in the bitcoin space. But the rewards are worth it. With bitcoin, we have the opportunity to build something honest, transparent, and fair.
Abuse and exploitation of all forms have plagued people of color throughout history. Equal access to money is not a privilege; it's a right. Wealth creation, monetary sovereignty, and financial stability should not be a pipe dream—they should be a reality. In our current system, these powers concentrate at the top, and the people who need them the most are left out in the cold.
We have discrimination across several dimensions—including, but not limited to, race. Bitcoin is the most neutral, apolitical money in the world. It doesn't discriminate based on race, and it never will. That's because bitcoin is software. Bitcoin is math. And math doesn't care about your skin color.
Changing the system is a fool's errand. People can't afford to wait generations for incremental changes that may never come. The only way forward is a system that takes away that power and puts it back into the hands of the people. That system is bitcoin.
We have a long way to go with normalizing bitcoin, but the potential is undeniable. We can make a difference with the proper education, outreach, and innovation on top of decentralized platforms. We can create a system that is discrimination-resistant, racially inclusive, and universally accessible. We can build a future where people of color have better opportunities to participate in the global economy—and that future is now.
- Jackson Rickun