Money is life. For nearly every human being on the planet, it’s more important than children, mom, art, whatever. Technically, it’s a record of payment. It can be a currency, but it doesn’t need to be. For an abstract idea, both real and unreal, money is quite tangible. Money means your kids eat or go hungry. Money enables a bag of paper to be exchanged for a house full of appliances. Money can be sex. Money can be murder. Say “money” three times fast and it feels like a marble of vanilla ice cream rolling around on your tongue. And money is all kinds of emotional. It’s attached to self-worth, shame, and safety. The other morning I noticed my wallet had no more money in it, so I went to an ATM and a neurological reaction turned the feeling of ten pieces of paper in my hand into “happy,” “more relaxed,” “more secure,” all at once.
You may not know what money is, but you know what is money.
But now money’s changing, perhaps forever.
What is crypto? A couple years ago, crypto was the future, according to your cousin at Thanksgiving. It had something to do with Internet drugs in China? He couldn’t explain it very well; it sounded like another one of his schemes. But then, out of nowhere, crypto kind of was the future. Bitcoin bros the world over became millionaires. And then the bubble burst, everything went to hell, everyone consoled your cousin while breathing a sigh of relief, because crypto had disappeared, and none of you needed to figure out what the hell it had been. Only crypto didn’t disappear, it just went quiet. And this Thanksgiving, the evangelists will tell you it’s bigger, more relevant than ever, only they’re not just your cousin anymore. They’re the People’s Bank of China. They’re Mark Zuckerberg. Talking about crypto today is more like talking about the climate crisis. Forget real or unreal. It’s “how soon,” and “oh crap.”
Crypto is life. You just don’t know it yet.
Brian Kim is real, but that’s not his real name*. Kim immigrated to San Diego for graduate school in his early twenties. About a decade later, he is millennial in several ways that will be familiar to anyone watching recent sitcoms. He likes music and hanging out with friends. His parents have high expectations for him that he feels he does not quite fulfill. He doesn’t like his job and isn’t sure how it became his career, though it is lucrative: Kim is an elite academic coach with many clients who are wealthy, in some cases very, in a few cases ludicrously so, all of them quite happy to pay top dollar so their kids receive the best (legal) test prep that money can buy.
*In addition to providing this person with a pseudonym, certain identifying characteristics have also been changed.
Which is how Kim, by living in a small apartment (“very small”), minimizing his expenses, and subsisting on ramen packets for nearly a decade, managed to save a decent amount of money. And then suddenly become wealthy—very wealthy, even ludicrously so.
Kim heard about crypto from a friend I’ll call Derek*. “I think it was about 2013 or ’14,” Kim said. “[Derek] was like, ‘Hey, I’ve been looking into this and I really think maybe we should invest in some Bitcoin.’ ” Kim was intrigued, but he didn’t follow through. Like a lot of people, he’d heard about Bitcoin, the original crypto and still the OG, but it didn’t sound fully real. Then, in 2017, he tried buying some “altcoins.” An altcoin is essentially any cryptocurrency that isn’t Bitcoin; in October 2019, a database listed over three thousand of them. Some improve on Bitcoin’s core technology by offering more secrecy, or better security. Many are simply wannabes, copycats that inspire wildcat behavior, that get painted by the wide brush known as “shit-coin.” Still, some alts have outperformed Bitcoin itself; in 2017, a coin called XRP rose by 36,000 percent.
The autumn of 2017 was near peak crypto madness. Kim started out with the altcoin Cardano, buying about twenty bucks’ worth at four cents a coin. A few days later, it rose to eight cents, doubling his investment. “So that was like, ‘Holy shit. If I’d put in like a hundred bucks, that would’ve been two hundred bucks.’ ” Remembering the moment, Kim widened his eyes slightly. “I was like, ‘What am I doing keeping money in a bank account when I can just put it into these things and it doubles?’ ”
Through Derek, Kim soon heard about another coin called RaiBlocks. The appeal of RaiBlocks was its quick transaction speed. You could send a friend a couple RaiBlocks almost instantly, whereas Bitcoin transactions might take several minutes or longer to register. At the time RaiBlocks was trading for about a dollar. Kim bought in. Soon it was selling for two dollars, and Kim bought more. The experience of watching the price rise while his money doubled felt like fever. He would look at his phone, put it down, pull it up again; the price kept climbing. It was magical. “I remember, I went to a party and I was basically trying to convert people. I was like, ‘No, I’m not kidding. You put in $10 tomorrow and watch what happens, it’ll become 20 in a day.’ And then it did just that. Again and again. I was like, ‘Holy fuck.’ ”
“We found [RaiBlocks] really early,” Derek said. “We got in pretty damn early on that. Which was a miracle because we were late to the party of crypto, in general.”
December 2017 was the month that crypto, as an asset class, became valued in excess of $800 billion. For the everyday believer, the story you told yourself before sleep was the same one you woke up to in the morning. You were Keith Richards. You were Thanos. You were unbeatable.
Kim would eventually move most of his savings into crypto. “I think I may have eventually blocked some of this out on purpose,” he said. RaiBlocks was the big bet. The price climbed to $5, to $10, to $28. Then Kim got into day trading, i.e., speculating, buying and selling other coins besides RaiBlocks for a quick profit. Suggestions for a hot coin would come in through Twitter, Reddit, or groups on Telegram, a messaging app favored by the crypto world. He said it felt like a video game; the volatility was jungle-crazy, but the bets kept paying off. To a point where Kim was slinging trades all day. The trick seemed to be to jump from one coin to the next in the right order. “Some of it was incredibly easy, too,” Kim told me, “because you would see a chart that had hit resistance come back down to support, then you just buy it and set it to sell when it hit the resistance again, and it was fine.”
I had no idea what he was talking about, and I wasn’t completely convinced he did either, not entirely. Neither Derek nor Kim had any prior experience in finance or trading stocks. “It was super fun because it was a bull market—it would just go up the whole time,” Kim said. “So you’d wake up, and you thought you were a genius.”
Kim wouldn’t tell me precisely how much money he put into crypto; same for Derek. Kim allowed that his buy-in was approximately enough to purchase a small condo in a mid-tier U.S. city. “It was whatever you had,” Derek recalled. “And the thing is, you just can’t not put it in at that point. How can you not put it in, right?” The main thing to know about Kim’s investment is that, within a few weeks, he had “36x’d.” In crypto-speak, that meant his investment became worth 36 times more than what he started with. Kim could have cashed out and purchased 36 small condos, or perhaps a nice house and a Lamborghini. And never tutor students again.
Around that time, early winter of 2017, Kim met a girl at a party and told her about RaiBlocks. “She’s like, ‘Are all of the cryptos like this?’ ” he recalled. “And I’m like, ‘Kind of.’ She’d always wanted to get into it. It worked out really well, we were exchanging messages on Facebook about it.” That December, prior to going home for the holidays, Kim thought maybe he’d become a crypto trader full-time. It felt like he’d been let in on a giant secret. “It just felt like it would never end,” he said. “But I didn’t know what I didn’t know.”
Bitcoin: A Refresher
Crypto can be a head-spin. Simply put, a cryptocurrency is virtual money, cash with no physical form. It’s decentralized, meaning you can give or receive crypto without another party—PayPal, a credit card company, a government—getting in the way.
This is key. In fact, a large part of crypto’s allure relies on crypto not being “real” or regulated. “Real” currencies are tied to institutions that can mess with them. In the U.S., for example, the Federal Reserve can expand or contract the money supply. In Venezuela, mismanagement and corruption have lately killed a once enviable economy with hyperinflation, rendering daily life next to impossible. The more bolivars the Venezuelan government prints to pay for imported goods, the more the currency depreciates. It’s a mess, and one that ordinary Venezuelans have little control over.
Bitcoin is a different story. With Bitcoin, there’s a fixed number of coins: 21 million, of which about 17 million have been “mined,” or brought to life. It can’t be minted endlessly. Your coin is your coin, and no American, Swiss, or Venezuelan government can mess with it. The crypto-bulls will say that if you were burned by the banks in 2008, if you dislike authority generally, crypto is the currency for you.
Bears, meanwhile, believe that the value of crypto, without institutions behind it, derives mainly from its users’ desire for it to be valuable. That crypto’s worth is speculative, and possibly not so much virtual as phantasmic, or something to be feared. Crypto is a “fraud,” “the mother of all bubbles,” “probably rat poison squared”—descriptions at times expressed by Jamie Dimon, Nouriel Roubini, and Warren Buffett. Just this past February, after the release of Berkshire Hathaway’s annual letter to shareholders, Buffett doubled down. “Bitcoin has no unique value at all. It doesn’t produce anything…. It’s a delusion basically.”
Bitcoin was created in 2009 by “Satoshi Nakamoto,” a moniker that may or may not be fictitious and may or may not represent one person or many. (The crypto world has been opaque from the start.) “I’ve been working on a new electronic cash system that’s fully peer-to-peer, with no trusted third party,” Nakamoto wrote in 2008. Under that system was the technology people call blockchain. Blockchain is what enables crypto to be country-less: a public accounting system that records every transaction in multiple places. Imagine, instead of a central bank, a circulated accounts book. Not a god in the heavens recording everybody’s deeds on stone tablets, but somebody spray-painting them on the moon. Less Big Brother, more BitTorrent.
The first Bitcoin adopters were cypherpunks, heavy into cryptography and privacy. Satoshi him/her/themself wrote to a cryptography mailing list in 2008, “It’s very attractive to the libertarian viewpoint if we can explain it properly.” Anarchists, preppers, Extropians—people who believe that technology someday will enable human beings to live forever—started buying and trading. Because a gold rush never starts as a “gold rush.” It begins with somebody in the woods yelling, GUYS, I FOUND A ROCK. And it takes a certain type to follow that dude into the forest, and it’s generally not your soccer dads and Lulumoms.
A unit of Bitcoin, a single “coin,” wasn’t worth much in the beginning, in part because you couldn’t do much with it. The currency’s first commercial transaction didn’t occur until 2010, when a programmer named Laszlo Hanyecz bought two pizzas for 10,000.99 Bitcoins, about $41 at the time. True story: Hanyecz asked on a message board if someone would get him some pizza. Someone did. Then, around 2011, Bitcoin became known as the coin of the realm for Silk Road, the black market, where crypto’s relative anonymity had understandable appeal. Quickly, the currency grew in popularity and value. In 2013, the total value of coins in circulation surpassed $1 billion.
By December 2017, there were only three commandments at the altar of Satoshi: Up, More, and Gain. (Given Satoshi’s reported cypherpunk ideals, such a sentence would probably make her, or him, or them, puke.) When Brian Kim went home to visit family for Christmas, you could sell one Bitcoin for $19,666. Which meant if you’d ordered a pair of pizzas seven and a half years earlier, you were now worth nearly two hundred million dollars—assuming you’d tucked away the receipt and forgotten about it. Alas, Jeremy Sturdivant, pizza guy, long ago sold his Bitcoin, back when 10,000 were worth a couple hundred bucks, in order to pay for some travel, he said in an interview. It’s not quite like being the fifth Beatle, or the third founder of Apple—Ronald Wayne, who sold his 10 percent share to Jobs and Wozniak for $800 in 1976—but it’s close.
My Adventures with Crypto
“I don’t really think that you can fully experience crypto without actually holding coins, without actually participating in it,” Aaron Lammer, the co-host of CoinTalk, a crypto podcast, told me.
I approached my editor with a plan: If the magazine would float me a hundred bucks, I’d see what I could do in a month, using an extremely ill-informed approach I devised after digesting way too many Reddit crypto threads. First I’d spend a week speculating based on my own impressions of the market. In the second week, I’d try out a few tips from Brian and Derek. For the second half of the month, I’d see what I could gain from the advice of the Internet—figuring, based on what I’d read on Reddit, that this sequence echoes the chronology of many people’s initial experiences with crypto. First, you know nothing. Then you know what your friends know. Then you know whatever’s being shouted loudest by the herd.
Even in 2019, buying and trading crypto requires a relatively high bar of Internet expertise. Any person slightly bothered by setting up two-factor authentication for their e-mail should prepare to be stumped. I started by purchasing $100 worth of Bitcoin from a site called Coinbase. Next, I “sent” my Bitcoin to a “wallet” to be stored when I wasn’t trading. Crypto wallets can be virtual or physical. Either way, they hold your “public key,” a string of numbers and letters unique to you that also has its own private key; when the two keys are combined, a digital signature is produced that enables a transaction to be validated and recorded in the blockchain. See what I mean about complicated? For my wallet, I bought a small thumb-drive-like device for $60. It came in six colors. I chose a millennial-friendly dusty rose. It wound up being so convoluted to use, I felt like I was carrying around our government’s nuclear codes.
But since I was going to be trading a lot, I mostly kept my coins stored in an exchange. Like the New York or London stock exchanges, crypto exchanges are where coins are bought and sold. But they can also function like banks, as wallets for people’s investments, and that’s a major reason why crypto exchanges have been the targets of so much fraud and theft. Many exchanges look like websites thrown together on a 15-year-old’s Chromebook, stocked with shit-coins no one’s heard of, where a shady operator may steal your money at any time—a feeling reinforced by the number of times this exact scenario has occurred.
What makes crypto trading dangerous isn’t just a lack of regulation; it’s the chance of being hacked. Reports have found that, since 2017, $1.7 billion worth of crypto has been stolen from exchanges. Crypto owners live in fear that an exchange operator will turn off the lights one night and vanish with the cash. All thanks to a simple reason that’s baked into blockchain: Crypto transactions are irreversible. In the traditional financial system, fraudulent transactions often can be reversed. With Bitcoin, once a coin leaves your wallet, it’s gone. In April 2019, a “blockchain bandit” reportedly stole approximately $50 million worth of Ethereum, crypto’s top altcoin, just by preying on people’s private keys.
Still, I wanted to feel a day trader’s thrills, so I started picking coins at random. One of my first trades, I spent about $10 worth of Bitcoin on 20 coins of IOTA—because I didn’t have one “iota” of knowledge about trading crypto. Between that and other trades, by the end of the week my portfolio was down 10 percent. Why, I had no idea. Was there a story in the news I missed? Was it simply people buying and selling, disconnected from the real world? For week two, I asked Brian and Derek to pick my coins. Thanks to them, or simply the vagaries of the market, within a few days I’d gained back my 10 percent. At one point, I was worth $100.30. Then, to follow my genius plan, I sold all of Brian and Derek’s suggestions and for several days followed the tips of a guy who taught day trading online on YouTube—there are lots of these guys. Soon I was down to $82.
No one thinks worse of amateur day trading than people who work in finance. “There is a guy with a computer on the other side who’s watching stocks all day long—you think you’re going to beat that guy? You’re not. You’re playing against the casino.” This was an old friend whom I’ll call Luisa, who has worked in finance for fifteen years*. She expressed extreme caution for anyone, including financial experts, who confused day trading for an investment strategy. Still, she appreciated crypto’s allure and had been tempted herself, she said. “I wouldn’t be surprised if the people who got wrapped up in the crypto boom weren’t people who have tons of money to play with. It’s like the American Dream; it’s too good to be true. ‘I’m making all this money!’ And then…” Luisa compared the crypto craze to the IPO bubble of the 1920s, when mom-and-pop investors thought everything would go up forever, until the market crashed. Which led, incidentally, to the formation of the U.S. Securities and Exchange Commission, to protect consumers. “The only thing that gives it value,” she said, echoing the Warren Buffetts of the world, “is that someone’s willing to pay more for it.”
The deeper I got into crypto, and the more I talked to crypto experts and finance professionals, the less I understood it. Not that I lacked for similes. People described the rise and fall of crypto like the Wild West, which seemed too easy. Like the dot-com bubble, which seemed a stretch. Like the seventeenth-century Dutch tulip craze, which may or may not have actually been a thing. And then there was straight metaphor: It was a Tupperware party for Macho Twitter. A pyramid scheme for Magic: The Gathering fans. It was London’s South Sea bubble all over again (for the history buffs). In 2018, AARP defined Bitcoin in its monthly bulletin as “a bunch of computer code that a bunch of criminals, idealists and spectators agree is worth ‘real’ money.” I actually thought that was pretty good. For my part, I found the present-day crypto landscape to be less like a bygone market, more like the parallel universe found in Westworld, a wasteland of corpses and creeps muttering vows of revenge.
“Bitcoin is not like a company like Facebook. It’s a protocol like e-mail,” Aaron Lammer, the podcast host, explained. Laura Shin, a crypto journalist for Forbes, pointed me to researcher Carlota Perez’s book Technological Revolutions and Financial Capital, which maps the connections between technological development and financial bubbles. “The beginning phase is always this speculative frenzy,” Shin said. I.e., the real breakthroughs are still to come. On the gold-rush angle, Bitcoin is “better at being gold than gold,” said Tyler Winklevoss (one of the twins who battled Mark Zuckerberg over the origins of Facebook) during an interview in 2016—meaning, I think, that Bitcoin’s fixed supply makes it a better place to store value, at least for people who put precious metals in their portfolio.
People who invest in crypto often speak like they know everything there is to know about crypto. When I talked to people for this article, a defensive tone bloomed early in our conversations. Partly because there’d been a lot of bad press, but people also seemed to want to know right away if I believed. If I recognized the potential for magic in their beans. As though, just to speak of crypto generally, you should at least be open to its revolutionary capabilities. It explained why Bitcoin-ers were often described as “zealots” or “evangelists.” In the religion of crypto, blockchain was the original god, Bitcoin was its prophet, and the altcoins were branches (forks, in crypto speak), with some denominations speaking in tongues to snakes, and some actually selling snake oil. A lot of the true Bitcoin believers didn’t even really recognize most of the altcoins as part of the same church. But everyone in crypto still believed, and it was frustrating to them that so much of the rest of the world had yet to make the leap of faith.
The Fall and Fall of Brian
Back in December 2017, with Bitcoin soaring, Kim flew home to spend Christmas with his family. The crypto craze was and remains by no means an American phenomenon. South Korea is home to three of the world’s biggest exchanges for Ethereum. As of 2018, a GlobalWebIndex survey found that approximately 5.4 percent of Internet users worldwide owned crypto; in the U.S. it was 4.9 percent. Kim talked to his parents about crypto. “I think they thought I was making good on my potential,” he told me, ruefully. While he was home, out at holiday parties, he felt obliged to share the good news. After all, when you’re handed the gospel, do you deny it because other people haven’t received it yet? It was inconceivable to him at the time that more people weren’t talking about crypto. Decentralize or die, baby! “You definitely wanted to convert people,” he said. “You wanted to be like, ‘No, it really does work. I don’t know how. It’s insane.’ ”
In 1923’s Reminiscences of a Stock Operator, Edwin Lefèvre wrote, “The public always wants to be told. That is what makes tip-giving and tip-taking universal practices.” Kim told me that at one Christmas party he met a professional stockbroker. As Kim talked up crypto generally, RaiBlocks specifically, the broker was disdainful. Kim remembered him saying, “You [know] what they say: When the cleaning lady is talking about a stock, it’s time to get out.” Kim laughed darkly when he recalled the memory. At the time he remembered thinking, What the fuck does this guy know? The reference the guy made had been to a story, likely apocryphal, that’s often attributed to Joseph Kennedy, the business-mogul father of JFK and RFK. Just prior to the Great Depression, Kennedy got a stock tip from a shoeshine boy and took it as a sign to get out of the market—figuring that if street urchins were swapping tips, it meant the market was ballooning, on the verge of a giant pop.
About a month after the holidays, an Italian crypto exchange called BitGrail halted trading. The exchange’s founder and CEO, Francesco Firano, who went by the handle The Bomber, said approximately 15 million RaiBlocks, over $150 million’s worth, had been stolen from his exchange. Very quickly fingers started getting pointed: at RaiBlocks, at mysterious hackers, at Firano. At one point, Firano requested on Twitter that anyone sending him death threats should please post them all in a single thread, to keep things tidy.
Kim and Derek were in a hot panic. They didn’t have any RaiBlocks with BitGrail, but the currency was losing value. RaiBlocks would later change its name to Nano and rebrand, but its reputation was tarnished. At one point, as though to protest his innocence, Firano posted on Twitter, “Either you die as a programmer or you live long enough to become a scammer”—which would appear to be a slightly tone-deaf riff on a quote from The Dark Knight by Harvey Dent, the guy who later becomes Two-Face: “You either die a hero or you live long enough to see yourself become the villain.”
The BitGrail story is still playing out. According to Firano’s lawyer, a bankruptcy procedure is currently under way and Firano has lost access to his personal funds. Nano, previously RaiBlocks, is currently being sued for allegedly directing investors to use BitGrail in the first place. Back in February, after the news first hit about the hack, one investor hosted an ask-me-anything thread on Reddit called, “I lost 147k Nano ($1.4 M, and falling) in the Bitgrail hack, AMA.” Responses included “can i buy you a beer?” “Idk how you can be so calm,” “Not many people can say they lost a million dollars.” Bitcoin was also tumbling at that point, and altcoins often follow Bitcoin’s lead. Perhaps tumbling is an understatement: That January, Bitcoin fell in value by more than $46 billion. It was the crash the bears had foretold. RaiBlocks tanked all the way down to a dollar a coin, then less than a dollar.
In the winter, Kim and Derek watched their profits dematerialize. “At a certain point we just became numb to it,” Derek said. Surely, they believed, everything would rise again—and sometimes it did, only to fall further. Kim said he didn’t sell on the way down. Nano’s current price hovers around a dollar.
The Future of Crypto
Today, many cryptocurrencies are worth pennies compared to their peak prices. Yet we’re still reading headlines about Ponzi schemes and money laundering. In January, it was widely reported that the New Zealand exchange Cryptopia went dark after some $16 million was stolen. In March, a South Korean exchange, Bithumb, was reportedly hacked for $13 million. (Cryptopia did not disclose for this article the actual amount stolen. Bithumb did not respond to queries.) Then there’s the story of QuadrigaCX, a Canadian exchange that lost around $140 million after its co-founder died last December while traveling in India—weird because apparently he’d moved clients’ money into wallets that only he had the passwords to. Without those passwords, there was no way to access the crypto cash. That, after all, had always been the point.
Bitcoin is currently trading for around $9,000 a coin. This is up from the slump of 2018 and earlier this year, though the bears aren’t hibernating. Bad actors are said to include Mexican cartels, Chinese gangsters, North Korea. Headlines appear like “Neo-Nazis Bet Big on Bitcoin (and Lost),” and they aren’t just plausible, they’re not surprising. Seemingly most damning of all, a research team recently found that as much as 95 percent of Bitcoin’s reported trading volume over time had been fake. “The vast majority of the volume,” the report said, had been what’s called non-economic wash trading, when a person or a bot sold and bought the same thing at the same time, to generate the appearance of activity. A March op-ed in The Economist all but declared Bitcoin deceased: “The extent of genuine activity is hugely exaggerated; the technology does not scale well; and fraud may be endemic.”
Then what keeps Bitcoin alive? Why doesn’t crypto die?
For one, crypto is actually helping people. In Venezuela, cryptocurrencies have proved to be a useful tool in everyday life. “ ‘Borderless money’ is more than a buzzword when you live in a collapsing economy and a collapsing dictatorship,” Carlos Hernández, a Venezuelan economist, wrote in The New York Times, recounting how crypto enabled him to buy food for his family. He told me in an e-mail, “I can imagine that for the rest of the world, the prospect of a currency that’s not controlled by anyone doesn’t sound super enticing. But in my specific case it’s a lifesaver.”
“A really critical part of it is that it’s global. It has a global liquidity base, and it also has a local liquidity base,” Jill Carlson said. Carlson is a former bond trader on Goldman Sachs’ Latin American desk. Now a crypto consultant, she co-founded the Open Money Initiative, a nonprofit research organization. She envisions a future where crypto gains real traction and adoption in places like Iran and North Korea, to lift people stuck under authoritarian regimes. Because then “it’s being used for its original dream, its original purpose, its original vision.”
The fact is, despite any latent gloom in the media, many bulls are ready to run. Facebook has decided it will be good for business to launch its own crypto, called Libra. Mark Zuckerberg recently defended the scheme to Congress as a way to flank China’s plans for its own digital currency. This is remarkable on many levels, at least to me, because it further colors in the idea of Facebook as a state actor, a corporation that’s practically a pseudo-state entity—an American corporation operating with humongous powers of surveillance, little oversight, and a global platform that, buoyed by its own currency, may become an economic and political rival to the United States. There are plenty of other movements along the front. Jerome Powell, Chair of the Federal Reserve, recently confirmed to Congress that the Fed is evaluating the idea of a central bank digital currency. Jamie Dimon, the CEO and chairman of J.P. Morgan Chase, ultimately regretted his “fraud” comment; now Chase is preparing to launch “JPM Coin,” the first coin backed by a major U.S. bank. For 2019, total corporate and government spending on blockchain is estimated to hit $2.9 billion, up 89 percent from the previous year. Crypto personality John McAfee, who got rich off of antivirus software in the ’90s, tweeted in 2017 that if one Bitcoin wasn’t worth more than $500,000 in three years, he’d eat his own penis on national television. Close to a year away from that event coming true, McAfee still tweeted in March that losing the bet was “not mathematically possible.” Meanwhile, the fintechs in fleece vests are chanting “blockchain, not Bitcoin,” pivoting away from currency to smart contracts and governance mechanisms. Don’t even ask.
And even though Bitcoin can now be spent at Whole Foods, experts advised me that we’re still in the early days. Crypto is barely ten years old. When the Internet was around that age, we were still in the 1970s. Joseph Eagan, president of Polychain Capital, possibly the world’s largest cryptocurrency investment fund—in 2018, they had more than $1 billion in assets under management—advised me to think long-term. “The metaphor I like to use is: Don’t invest in the air conditioner for the car before the highway is built,” Eagan said. “We still don’t even have the highway system on which that car is going to drive.”
Toward the end of my month of day trading, I said to hell with it. When you’ve seen one video titled “Building a 13 GPU Mining Rig – Asrock H110 Pro BTC+ RX560 RX470,” you’ve seen them all. I converted my holdings into Bitcoin, then forgot about them. A week later I checked again: Thanks to a Bitcoin spike, they were worth $106. And maybe someday they’ll be worth their weight in pizza, but I didn’t care. Jessica Klein, a blockchain reporter, told me about a program that fed schoolkids in Caracas, Venezuela. “You can send crypto to this one school. It’s only helping 50 kids, but it’s giving them a meal they wouldn’t otherwise have.” It took me about 30 minutes to turn my Bitcoin into empanadas and juice.
In Kim’s case, though he lost his gains, his savings remain in crypto, mostly Nano. He didn’t consider his story to be all that bad, he said. He didn’t have children or a family to support. He still had a job, and he could always go back to eating ramen. Plenty had suffered worse—and he remained bullish on Nano and crypto. “You know, honestly, if I had a better car, I’d sell it and get back in,” he said.
I stammered, Really?
He smiled and insisted he would. Derek told me he felt the same. In fact, Derek recently sold an old car, and after he paid some bills, he invested in more Nano. Decentralize, or die trying.
Rosecrans Baldwin‘s latest novel, The Last Kid Left, was one of NPR’s Best Books of the Year. His next book, a work of nonfiction about Los Angeles County, is forthcoming from MCD x Farrar, Straus and Giroux.
Edward Norton Breaks Down His Most Iconic Characters
Originally Appeared on GQ