By Joy Bergmann
The mood was downright ebullient at Tuesday’s Bitcoin Happy Hour for cryptocurrency enthusiasts held at Blockchain Center — a loft-like space at 2307 Broadway (83rd). One contributing factor? The first Bitcoin-focused exchange-traded fund had just launched, with about $981 million worth of shares traded on its first day, marking another major milestone toward Bitcoin’s acceptance by mainstream investors.
“It’s the second-most traded ETF in history. A billion. Day one,” says Richard Levin, 38, co-host of the biweekly event, an Upper West Sider and vice president at Cryptonews.
Whether you find the whole digital currency world frightening or fascinating, Levin says, “you will participate in the future because it’s inevitable. If you choose to participate now, you’re rewarded with massive gains because we’re so early.”
Many people [including this reporter] still do not fully understand the basics of Bitcoin and blockchain technology, something Blockchain Center seeks to change as an educational hub for newbies as well as true believers.
“We offer knowledge,” says Anna Gizburg, its director. “There are new financial systems coming out that will truly revolutionize the way we conduct business…It’s crucial for the community to be educated and for everyone to be able to participate and succeed.” The team encourages folks to stop in and talk about blockchain with experts. For free. “I want to create a welcoming environment for people…for anyone interested in the new systems and learning more,” she says.
Being located on the Upper West Side is bringing more “everyday” people into the fold, including parents and kids, says Mackinzie Dae, 33, the director of operations. “It’s a place to educate yourself, to ask questions without being judged.”
So, do we dare ask the most fundamental question: What is Bitcoin? And why is its value skyrocketing past the $60,000 mark after debuting at less than a dollar back in 2009?
Succinct explanations are tough to come by.
Turns out, talking about digital money that’s earned by computers solving difficult math problems [mining Bitcoin tokens], digital money with transactions that are anonymized, authenticated and recorded on a permanent, decentralized, digital ledger that’s visible to everyone [the blockchain], first forces discussion around the very nature of money itself, especially the greenbacks in your wallet.
“Money is something that we just trust in,” says Levin. Prior to the U.S. leaving the gold standard in 1971, “that piece of paper was worth a fraction of gold. But that’s gone.” Now central banks can simply decide to print money, he says. “Every time they do that, the dollar in your pocket is worth less and less.”
Levin says Bitcoin offers an alternative way to store wealth that is deflationary because it has scarcity built in. “There will only ever be 21 million Bitcoin,” a figure to be reached in 2140. Each Bitcoin can be divided into 100 million pieces, called “sats”, he says. “Eventually we’ll use sats like dollars. ‘I bought a cheeseburger for two sats.’”
A global computer network moves this digital money from person to person without needing intermediaries like a credit card company or bank. It’s somewhat analogous to sending an email versus a letter, he says. “The time and effort of licking the stamp, paying for it, or boom— firing it off,” says Levin.
Bitcoin fans often mention a powerful use case in remittances where folks working abroad send funds back to their families. With Bitcoin, they say, there will be no need for Western Union, for example, or its fees. “Currently there’s a Lightning Network on Bitcoin where you can send money for free,” Levin says. “The world is changing. You’re moving towards this digital world. You can’t stop it now.” And if you haven’t jumped in yet, you’re not too late, he says. “I think we’re essentially, if you equate this to the internet, this is like 1998. [Today] is like America Online.”
Mira, a 37-year-old MBA meetup attendee who works in international logistics, is all for it. “I am here for the revolution. Bitcoin. I think it’s going to change the world,” she says, pointing to transformations in developing countries made possible by decentralization. “It’s giving [unbanked] people access to the financial world…it gives them a vehicle to save that their government can’t confiscate or debase. It’s going to bring people out of poverty.”
Not everyone is a convert.
While billionaire investors like George Soros have added Bitcoin to their portfolios, and a Fidelity Digital Assets global survey of 1100 institutional investors found that 52% were already invested in digital assets, JP Morgan Chase CEO Jamie Dimon recently asserted “Bitcoin is worthless,” and New York magazine interviewed multiple soothsayers — ones who foresaw the 2008 stock market crash — calling Bitcoin a bubble .
And for all the freedom and opportunity this new world seems to promise, headwinds and nefarious behavior have also shown up to the party.
In September, El Salvador became the first country to adopt Bitcoin as legal tender; but two weeks later, China declared all cryptocurrency transactions to be illegal. People are also waking up to the huge electricity requirements of Bitcoin-mining computer operations — more than entire countries like Sweden and Argentina — and their attendant carbon footprint, contributing to climate change. And ransomware attacks on fuel companies, meat packers, hospitals and more have locked up vital systems, compelling crypto ransom payments to hackers, some $400 million globally, according to the White House.
In short, it’s complicated. But fans say significant growing pains are to be expected when a $2 trillion industry gets built in a few short years and improvements are underway on these security and environmental issues. “Nobody in Bitcoin is looking to destroy the earth,” says Levin.
Fence-sitters may fret about the many variables at play, but there’s no denying that fear-of-missing-out feeling when yet another headline trumpets how much Bitcoin is increasing in market value, up 8X since October 2019. Some speculate the price could climb to $500,000 in the next 10 years. Or it could go to zero. Is there a way to dip a toe in these tempting waters without going under?
Levin says novices can easily open an account on a well-established exchange platform like Coinbase or Gemini to make a small, starter Bitcoin buy. But before you click, he says, take the time to “educate yourself a little.”
The Blockchain Center team invites anyone looking to learn to email them at firstname.lastname@example.org, or check out the next Bitcoin Happy Hour Meetup on Tuesday November 2nd at 6 pm.
Seems even hardcore digital denizens find connecting in person a superior ideas-swapping technology.
“The vibe…it’s nice to be here,” says Fernando, a 44-year-old investment banker and Upper West Sider. “Most of us spend a lot of time on Twitter talking to people we don’t know. And then you are here in the Center and you actually meet face to face with people that like what you like and invest in what you invest. It’s really good.”