Why (and How) Women Should Be Exploring Cryptocurrency Right Now
It's been estimated that only 10 to 15 percent of the people currently investing in Bitcoin are female. Is this once-in-a-lifetime wealth-generating opportunity passing by a generation of women due to the preponderance of mansplaining around the topic of cryptocurrency?
Sure, when cryptocurrency arrived on the scene, it sounded like the stuff of science fiction. But Bitcoin and other digital alternatives to government-issued money are here to stay, and they're producing eye-popping gains in price as they achieve new levels of mainstream awareness and investment.
Studies have recognized that women perform as equals at, if not better than, generating returns on investments compared to their male peers. And with more people learning about the cryptocurrencies, it's crucial that women take their skillset into that space and consider these assets as part of their investment mix. Here's why—and how to do it.
What is cryptocurrency anyway?
Bitcoin, the first and most well-known cryptocurrency, emerged in 2008 when a still-unknown figure, under the pseudonym Satoshi Nakomoto, published a now-famous white paper detailing the creation of a new form of currency not controlled by any bank or government, designed both for transactions and to serve as a store of value.
Each Bitcoin contains a million Satoshis—think cents to the dollar—and this is what investors are actually buying when they say they're "buying Bitcoin." These digital tokens are produced through complex math performed in a computing process called "mining." New Bitcoins are still being mined today, but by Nakomoto's design, only 21 million Bitcoins will ever exist, and the last one will likely be created by the year 2140.
Ethereum is the second-largest cryptocurrency by market share, but it actually functions as a blockchain-based computing platform that allows developers to build and deploy decentralized applications that power real-life applications, such as crowdfunding and small business loans. Lite Coin, also popular, is an "alt-coin" that is technically similar to Bitcoin but holds a much smaller share of the market.
Who else is on board, and why?
Institutional adoption of digital currencies, Bitcoin in particular, is growing fast. In January, Tesla converted $1.5 billion of its balance sheet into Bitcoin, and will soon start accepting the cryptocurrency as payment for vehicle sales. Other major companies making big investments in Bitcoin include the payments processor Square and the business intelligence software provider MicroStrategy.
One reason companies are exploring digital currencies is that they're proving to be a worthy store of value—both more rare and more profitable than gold itself. The reason why Bitcoin in particular has received recognition as a store of value is its finite nature, paired with growing demand that has made Bitcoin the best performing asset of the last decade.
How can I invest?
The current momentum in the cryptocurrency market is being fueled not by major corporations' moves, but by the rise of easy-to-use consumer apps that allow individuals to invest with the tap of a button.
Apps like Paypal, Cash App, Celsius, and Voyager allow users to easily invest anywhere from $5 to $50,000 in not just Bitcoin but other emerging cryptocurrency and blockchain technologies.
Stacking sats—aka making small buys of Bitcoin on a daily, weekly, or monthly basis—is a popular strategy among individual investors, and it's also one of the safest. Bitcoin's extreme price volatility means that the market price fluctuates by the second. By spreading out an overall investment over the longest time horizon possible, people are able to average the price and avoid buying at peak prices.
What are the risks?
Even by investing in this conservative fashion, there are still potential risks to contend with.
Unlike other types of investments, buyers of cryptocurrency also need a secure place to store it. Each "wallet" is protected by a private key, a sophisticated tool that enables you to access your cryptocurrency and restrict unauthorized access. Think of this as the most critical password you'll ever protect – just ask the man who lost his password to access his more than 7,000 Bitcoin, worth about $385 million.
"If you're alive today, you're living through a global financial evolution that transforms the way humans invest," said Tiffany Madison, an entrepreneur and cryptocurrency early adopter in Austin, Texas, who has been involved in the industry since 2014. Madison has seen the community evolve from a boys club to an inclusive, diverse group of investors, and she's passionate about making sure women are included in this financial revolution.
Raised slightly above the poverty line by a single mother with fierce budgeting skills, Madison pointed out that technologies democratizing wealth-building for the working middle class simply didn't exist even ten years ago.
"These unprecedented opportunities empower and enable savvy women to build intergenerational wealth in unprecedented ways," said Madison. "My mother's generation would never conceive of such an opportunity." So now's the time for our generation to jump on it.