Nerdy crypto entrepreneurs who spent big at Miami nightclubs, showering patrons with cash as they ordered “bathtubs of champagne” and sang with rappers like 50 Cent, have gone quiet, South Florida venue owners said.
The sudden collapse of the cryptocurrency exchange FTX and the plummeting value of digital coins has Miami nightclub owners pining for the days when young entrepreneurs flocked to venues such as E11even and its neon lights, trapeze dancers and burlesque shows.
“They were ordering 12 or 24 bottles of the most expensive champagne and just showering themselves without even drinking,” Andrea Vimercati, the director of food and beverage at Moxy Hotel group, told the Financial Times. “[The crypto entrepreneurs] wanted to show that they didn’t have any limits.”
Vimercati recalled that the crypto boom of a year ago prompted a wave of predominantly young men awash in money to flaunt their newfound wealth in Miami.
“Out of the blue, all these kids from crypto started coming down and spending a lot of money — like, an insane amount of money,” he said.
“They were booking tables for $50,000, and it was like, ‘Who the hell are these people’?”
Vimercati described the crowd as “95% men, young…with a kind of nerdy style.”
“You couldn’t tell they had a lot of money if they were just walking around,” he said.
Gino LoPinto, operating partner at the Miami hotspot E11even, told FT that a group of crypto businessmen came into the club in June of last year to celebrate what they claimed was the successful sale of their company.
“50 Cent was performing, and their spend was more than a million dollars,” LoPinto told FT. “They paid in crypto.”
LoPinto added: “They had bathtubs of champagne brought out, and gave 50 Cent a bunch of cash to throw.”
In April of last year, E11even started accepting cryptocurrency payments. LoPinto said that the club processed $6 million worth of transactions between April and December of last year.
In the last three months, however, the club has taken in just $10,000.
LoPinto said that crypto entrepreneurs would brag about their wealth by showing each other their digital wallets.
“You wouldn’t normally show your bank account, but people do show their crypto wallets,” he said.
“I’ve seen more crypto wallets in a year than I’ve seen bank accounts in a lifetime.”
In the year since, the crypto partiers aren’t calling. Instead, they’re licking their wounds alongside an entire industry that has been rocked by the implosion of FTX, the exchange founded by the disgraced Sam Bankman-Fried.
FTX filed for Chapter 11 bankruptcy protection earlier this month after it was learned that Bankman-Fried was using customer funds to place risky bets through sister firm Alameda Research.
The collapse of FTX was shocking given that the company, whose roster of celebrity endorsers included Tom Brady, Gisele Bündchen, Larry David, Steph Curry, and others, was at one point worth some $32 billion.
BlockFi, another crypto firm that was in talks to be acquired by FTX, filed for Chapter 11 in federal bankruptcy court in New Jersey on Monday.
The news sent the value of the overwhelming majority of cryptocurrencies down. As of 11:19 a.m. Eastern time, bitcoin was down nearly 3% while ethereum was down more than 4.8%.
The global market capitalization of all cryptocurrencies in circulation was valued at $814.55 billion on Monday — which is down 3.5% compared to the previous day, according to CoinMarketCap.com.