26 Jun Cryptocurrency Creates Financial Access and Risk for Underserved Communities
By Malcolm Marshall
The promise of getting rich investing in cryptocurrency is becoming increasingly popular. But it comes with real risks, especially for communities already living on thin finances.
To unpack these issues, American Community Media hosted a panel discussion June 13 titled “Behind the Resurging Crypto Craze—Huge Profits, Risks & Scams.” The speakers were Tyrone Ross, CEO and co-founder of Turnqey Labs; Cantrell Dumas, director of derivatives policy at Better Markets; and Elizabeth Kwok, managing director at FTI Consulting.
Ross grew up in a home without a bank account and limited financial knowledge.
“I saw my parents operate outside of the traditional financial system whether that was with check cashing places or money orders,” he said. “So when I was introduced to Bitcoin, I couldn’t really unsee the opportunity, exacerbated by the fact that I was working on Wall Street.”
Initially a doubter, Ross described the moment he was introduced to Bitcoin by a friend.
“I was a skeptic like everyone else. So there’s this mythical man who created these 21 million coins, and I’m supposed to believe that, right? He sent me some to my phone. I got it immediately and I was like ‘OK, tell me everything.’ ”
He used a simple example to explain cryptocurrency.
“If I handed someone a U.S. dollar and I walked away — that’s all that crypto is and does. She doesn’t need to know my name. I don’t need to know hers. We don’t need a Social Security number. I don’t need a bank. We don’t need to exchange any words. That is no more, no less than what happens with blockchains or crypto. It’s the ability to send value anywhere in the world at any time to anyone without the approval or lack thereof of a third party, a bank.”
Ross said cryptocurrency isn’t just about convenience. It also reveals troubling issues in the traditional financial system.
“There is a great inequity when it comes to financial markets. There’s 1.4 billion people globally who are considered unbanked, 5 million of those folks here in the United States. There’s 12 million people who would be considered living in a banking desert, which means … not within 10 miles of a bank. It’s very expensive to be poor in this country.”
Ross said cryptocurrency highlights disparities.
“What Bitcoin and cryptocurrency ultimately do is act like a big flashlight on the existing inequities in financial markets and infrastructure not only in the United States but the world,” he said.
He noted that Japan launched a real-time payment system in 1973, while the U.S. only rolled out such a system, called FedNow, in 2023.
”Everyone deserves access to financial services,” he said. “If I am facing eviction or I need to pay my rent or have food today, Friday, and I get paid today, my money should not clear in my bank account on Monday.”
Dumas offered an overview of cryptocurrency and minority communities, highlighting potential and risks.
“Cryptocurrency has been widely promoted as a tool for financial inclusion,” said Dumas. “It’s often described as a way to reach the unbanked, bypass traditional financial institution and help underserved communities build generational wealth.”
Dumas of Better Markets noted that survey data shows Black and Latino consumers are more likely than white consumers to report having used or invested in crypto.
“This reflects both the appeal of innovation and the persistence of economic barriers that make traditional financial services feel inaccessible or insufficient,” he said.
But Dumas said people should consider the broader reality.
“In 2023, about 7% of U.S. adults reported using cryptocurrency, a decline from 10% in 2022. Only 1% said that they had used crypto to make purchases,” he said. “Cryptocurrency is functioning far more as a speculative asset than as a form of everyday money.”
Speculative assets carry risk that may not be fully understood, he continued.
“One of the most significant risks is volatility,” he said. “Cryptocurrency prices have shown dramatic fluctuations in short time frames with little to no financial cushion. This volatility can result in significant losses.”
He pointed to the racial wealth gap to underscores the risk. In the U.S., the median white household has six times the wealth of the median Black household, and five times that of the median Latino household.
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“Even small financial setbacks can have lasting consequences,” Dumas said.
Another major concern is fraud. Dumas said fraud and scams in 2023 alone led to over $5.6 billion in consumer losses. Losses in 2024 surged to 9.3 billion, according to FBI complaint data.
“Adults over the age 60 were particularly affected,” Dumas said. “These include Ponzi schemes, fake investment platforms, phishing scams, and impersonation tactics, often delivered through mobile apps or social media.”
Dumas also cautioned about Bitcoin ATMs, disproportionately located in low-income, Black or Latino neighborhoods.
“The vast majority of these ATMs only allow for the purchases of crypto with cash and typically do not allow the user to convert crypto back into cash,” he said. “Fees for these transactions can exceed 20%.”
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Kwok, who spent 12 years at the Federal Trade Commission, offered advice on avoiding scams.
“Many of the scams associated with cryptocurrencies are not new or unique,” Kwok said. “They have been around for decades. It’s just that the new hook is the digital asset or the cryptocurrency.”
She also mentioned several red flags.
“Anytime somebody is only willing to accept payment in cryptocurrency or is out of the blue asking you for a payment transfer, that should be a red flag,” she said.
“Another, of course, is the urgency. They need money and they need it now, and they need you to either go online to an exchange or run over to a Bitcoin ATM.”
Kwok said that confusion is often used as a tactic in scams.
“A red flag is the idea this technology is complicated and technical,” she said. “If you start asking questions, they’ll just throw a lot of technical jargon at you. That should cause you to pause and take stock of whether this is something that sounds too good to be true.”
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