Commentary

Like yeah man, the magic beans market collapsing is gonna get covered differently than the Chicago commodities exchange, I don’t know what to tell you.

— William B. Fuckley (@opinonhaver) November 25, 2022

If only the beanie baby market had had fdic protection

— Marc Elliott (@MarcEll04271396) November 25, 2022

impossible to even manufacture violins tiny enough https://t.co/0HsXXcQguN

— csz is going down with this ship (@cszabla) November 26, 2022

It was the spring of 2021, and Miami’s hottest night clubs were inundated with phone calls from cryptocurrency entrepreneurs that no one had heard of. They wanted to reserve lots of tables — or rent an entire venue for a whole evening at a cost of half a million dollars or more.

With the price of bitcoin then at $60,000 and crypto becoming mainstream, its biggest beneficiaries descended on the Florida city to flaunt their wealth at lavish parties…

A little more than a year later, the phones have stopped ringing after the collapse of Bahamas-based exchange FTX roiled the market and cast a pall over the industry. The crypto revellers frequenting Miami’s clubs have “completely disappeared”, Vimercati said.

Those on the dance floor had behaved as though there was no tomorrow. In the event, it turns out they might have been right. “They wanted to show that they didn’t have any limits,” recalled Vimercati. “They were ordering 12 or 24 bottles of the most expensive champagne and just showering themselves without even drinking.” …

The never-ending parties underscored Miami’s status as the epicentre of the US cryptocurrency industry. Florida’s low taxes were a big draw, as were less-onerous Covid-19 restrictions that turned the city into a magnet for revellers.

In March 2021, FTX paid $135mn to secure 19 years of naming rights for the arena where basketball team Miami Heat play. In June 2021, the Bitcoin Conference was held in Miami after relocating from Los Angeles.

Miami’s club operators have always been able to rely on a few big weekends, such as Art Basel, music festival Ultra and New Years Eve. But for the past two years, attendees at bitcoin events have demanded as many tables and in some instances have bought out entire venues to throw private parties.

“On the bigger crypto weekends, the groups coming in for private buyouts were these young tech guys,” said Alan Roth, owner of Rosa Sky rooftop lounge. “A buyout costs anywhere from 20 per cent to 50 per cent more than we would make on a normal night.”

Crypto money had flooded into other parts of Miami’s luxury scene too. “They bought big houses for $25mn plus, they rented big yachts . . . they had money and were spending it lavishly,” said Brett Harris executive director of luxury sales at real estate firm Douglas Elliman. “They were buying big houses in cash, no financing — converting Bitcoin into cash to buy.”…

Roth is hopeful that the latest source of demand for Miami’s luxury lifestyle will return. “I don’t think the crypto market is going to fold and be done. It’s like the regular market — it goes up and down. I don’t get the sense that they’re afraid.”

Not everyone agrees. “We don’t think they’re coming back,” Vimercati said.

Yeah, I knew I’d seen these guys before! Back in April, Fast Company was not impressed…

… All over Miami Beach and the hip Wynwood neighborhood, crypto-themed pop-ups try to create some cohesive sense that the city is the home for the Bitcoin cultural movement, but it all feels a bit wonky. And that’s equally true for the conference, housed at a big convention center a few blocks from the water. There’s also a real sense of desperation for some kind of star power that can elevate Bitcoin from digital gold for the techno-libertarian set to the true mainstream cultural movement it needs to be in order to actually catch on. The conference’s expo center features a big fake volcano and a mechanical bull (the latter of which offers a chance at winning one whole Bitcoin), but there’s not a ton to do beyond that…

And so this cultural spotlight on Ethereum has left Bitcoin feeling a little stale. That’s led to a palpable void in Miami this week—one that conference organizer BTC Media and the various sponsors and vendors are hell-bent on filling with a bizarre mix of fairly prominent voices from the world of finance and random celebrities. The end result is an event that feels like a low-level comic convention that’s being held in the same event space as an economic forum. It’s confusing and disjointed: There are presentations on the Federal Reserve and economic theory, but also personal sovereignty and cancel culture.

Bitcoin 2022’s highest-profile guests include Jordan B. Peterson, the controversial right-wing psychologist; former presidential candidate Andrew Yang; Shark Tank‘s Kevin O’Leary; Paypal and Palantir co-founder Peter Thiel; a handful of well-known athletes; and, of course, a bevy of homegrown crypto influencers like entrepreneur Anthony Pompliano. (El Salvador’s crypto-loving president Nayib Bukelele was supposed to appear, but dropped out at the last minute.) The guest with the largest selfie line in the conference’s showroom on Thursday was Barstool Sports founder, Dave Portnoy, the controversial self-described “baron of Bitcoin,” whose pandemic-era trading livestreams made him a popular figure in the crypto world…

Up with the [firework] rocket and down with the stick, as my Nana used to say.

someday a tech bro is going to invent violin nanobots strictly to make a joke and I will be torn about whether to laugh or not

— Tomoé (@CuriosoTheGreat) November 26, 2022