In a Rocky Crypto Market, Bitcoin's True Believers Are Unshaken

By all accounts, 2018’s North American Bitcoin Conference was packed. The bull market attracted more than 4,000 zealous attendees to Miami to hear the Bitcoin gospel. That January, the term “Bitcoin Billionaire” was widespread, and a tide of scheming hustlers and buttoned up institutions had infiltrated the ranks of Bitcoin’s true believers, looking for riches.

But after last year’s fervor, it appears that market declines made this year’s pilgrimage noticeably smaller.

“I have a few hundred people watching my speech,” Charlie Shrem said. “You look at how red tide affects the water ー it’s nature’s way of cleaning itself out.”

Shrem, one of Bitcoin’s original and most recognizable evangelists, isn’t complaining about crowd size. To him, the red tide was Bitcoin at the height of its popularity: a harbor swarmed by toxic investors. But now, the cooled value of the currency seems to have filtered out a large concentration of them.

“It’s changed,” Shrem said. “We go through these cycles.”

After serving two years in prison for aiding and abetting an unlicensed money transmitting service, Shrem has been keeping his head down in South Florida with his education service Crypto.IQ.

Shrem sat across from Cheddar’s reporter, Tanaya Macheel, as a herd of his fans crowded the cameras. They listened as she asked what he thought about banks and institutions getting involved with Bitcoin.

“It’s funny,” he told her. “A lot of people who got involved in crypto were like, ‘Screw the banks. We’re going to build decentralized money. We don't need government. We don't need institutions.’ Now, it's like, ‘Where are the institutions? We need them to save us.’”

In this case, “save” is not equivalent to “bailout,” but rather means that institutions validate the market with their own investments.

But then, like most of Bitcoin’s true-believers, Shrem offered a comment in philosophical defense.

“The libertarian roots are there,” he said.

Shrem wasn't the only attendee at Miami’s James L. Knight Conference center with a life fully committed to crypto. Ask those others about the bear market, and they say their faith in Bitcoin isn't shaken.

“It’s probably the first crypto conference I’ve been to in well over a year where I’m really enjoying myself,” Jeremy Gardner told Cheddar. “You can sense that so many of the scammers … the speculators and traitors are all gone. It’s really the people that are enthusiastic about this technology.”

Gardner, another true believer, echoed Shrem’s relief that last year’s crowd of Bitcoin day-trippers flaked this time.

He and Macheel sat against a large window overlooking the Miami River. Outside, a Miami-Dade marine patrol boat passed, and Macheel asked about his outlook.

“There will be a point in the future… where countries go cashless, and all of a sudden every single transaction that you make is being traced and monitored by [a] government,” he said. “At that point, I think something, whether it’s Bitcoin or another crypto asset, will take off in a massive way.”

Days after Cheddar spoke to him, NABC leadership banned Gardner from future conferences for including party images inside his memeified keynote that the conference said violated its anti-harassment policy. “These images didn’t create a safe environment for our attendees,” conference organizer Moe Levin said.

Last year, the conference attracted bad press after hosting an official networking event at a Miami strip club. The decision to ban Gardner is likely part of the conference’s attempt to distance itself from a frattier past.

The conference hosted an eclectic cast ー desperate hangers-on who trailed the famous, suited investors; the casually chic tech intelligentsia; and the occasional free spirit wearing a “Just HODL it,” graphic tee.

One such eccentric was Brock Pierce, who wore a dark, wide-brimmed hat, a blazer, and a cluster of beaded bracelets on his wrist.

“These bear markets are actually a really good thing,” he said. “Any time the market goes into a bull state, what happens is a lot of the wrong people start showing up for the wrong reason, just trying to make a quick buck.”

In post-Hurricane Maria Puerto Rico, Pierce is building what amounts to a crypto fantasyland. The island ー a tax haven for American citizens who establish residency ー is home to Pierce and like-minded crypto expats seeking stability and on-island investment opportunities for their digital fortunes.

“There have been zero startups funded in Puerto Rico,” Pierce said. ”Last year, at the end of the year, there were two startups that raised over a million dollars each. I think that we’ll see another four of those in the first half of this year.”

On the subject of Bitcoin’s progress in the last half-decade, Pierce immediately cited user growth. He estimated there were 500,000 Bitcoin users in 2014. “Today, that number is north of 10 million, so we’ve seen major adoption,” he said.

But who, exactly, are these users? In 2017, hustlers flocked to the bull market while institutional investment made the waters safe for crypto tourists. Does that constitute real progress?

In Pierce’s estimation, growth is growth. He offered what could be a painful truth for certain Bitcoin believers.

“Bitcoin is an open system,” Pierce said. “It’s open to everyone. And that includes governments and institutions. If they’re interested, this is an open community. It’s open source.”

An open source for institutions, scammers, dreamers, and others. Each sect has different motives, but all of them are subject to the unpredictability of the market.

With the value of Bitcoin down more than 80 percent from all-time highs, this year’s official attendance was down more 50 percent from 2018: the conference said there were 1800 guests.

But for those guests, the bear market seemed to be a nice opportunity for a respite. With Bitcoin’s value firmly in the shade, these purists basked in a warm Miami sun ー glad, they said, to stretch and breathe without bull market sightseers.

Tanaya Macheel contributed to this reporting

This article was originally published on Cheddar.com and is reprinted here as part of my portfolio