Internet entrepreneur Jack Dorsey and rapper Jay-Z are raising eyebrows over their initiative to teach people in Brooklyn public housing about cryptocurrency.
Bitcoin, a form of decentralized digital money that can be transferred between users’ virtual wallets, was among several cryptocurrencies to plummet in price over the last few months. The digital coin’s price fell from around $48,400 at the end of December to roughly $20,600 as of Wednesday.
Nevertheless, Jay-Z and Dorsey are personally funding the “Bitcoin Academy” — an initiative for residents in Marcy Houses public housing complex in New York to learn about cryptocurrencies. Jay-Z, whose real name is Shawn Carter, grew up in Marcy Houses.
“Bitcoin is becoming a critical tool for many in Africa and Central and South America,” Dorsey, currently serving as CEO of financial services company Block, tweeted last week. “We believe the same potential exists within communities in the US. Our goal is to prove that making powerful tools more available to people enables them to build greater independence.”
As Dorsey mentioned, El Salvador became the first nation to adopt Bitcoin as a form of legal tender last summer. According to El Salvador’s government, the use of the cryptocurrency could fuel “financial inclusion,” noting that “70% of its population doesn’t have access to traditional financial services.” Last month, El Salvador bought $15.5 million in Bitcoin at nearly $31,000 — meaning that the nation lost more than one-third of its investment amid the most recent selloff.
“The vision for Bitcoin is that it doesn’t have barriers, but lack of access to financial education is a barrier,” the Bitcoin Academy website says. “This program aims to provide education, empower the community with knowledge, and get rid of some of the barriers so that residents can learn more about Bitcoin specifically and finance in general.”
The program will give residents MiFi devices, serve dinner twice per week through the summer, and offer a special “Crypto Kids Camp.”
Some, however, questioned whether Bitcoin is the best investment for those struggling to make ends meet given the uncertainty that characterizes the cryptocurrency space.
“They’re saying you’re going to have financial freedom, but that also means you’re getting access to cryptocurrency’s volatility and complexity,” Brookings Metro fellow Tonantzin Carmona told TechCrunch. “You’re getting access to a space that is rife with scams, fraud, hacks and all sorts of things, because there aren’t consumer protections in place as the technology currently stands.”
Earlier this week, cryptocurrency exchange platform Coinbase revealed concerns about a looming recession and “crypto winter,” announcing that the company would therefore lay off nearly one-fifth of its staff.
“While it’s hard to predict the economy or the markets, we always plan for the worst so we can operate the business through any environment,” Coinbase CEO Brian Armstrong said. “Coinbase has survived through four major crypto winters, and we’ve created long term success by carefully managing our spending through every down period. Down markets are challenging to navigate and require a different mindset.”
Despite skepticism, cryptocurrencies remain popular among younger Americans. The 2022 Investopedia Financial Literacy Survey revealed that 28% of Millennials — those between the ages of 26 and 41 — expect to use cryptocurrencies to support themselves in their latter years. Nearly 20% of Gen Z — those between 18 and 25 — said the same.