Bitcoin Grows Up, Buys a Suit and Puts On Leather Shoes

February 12, 2015 | Peter Yeh

Bitcoin, the free-wheeling, scam-infested, “fuck the system” techno-libertarian cryptocurrency, lost the dyed hair and leather jacket. He finally bought a nice suit, shined leather shoes and grew up. On Wednesday night, finance and venture capital firms, bitcoin startups, economic think-tanks, and former government big-wigs gathered to talk bitcoin at the Museum of American Finance.

Previous bitcoin talks, like the Satoshi Roundtable, took place in what looked like a local Holiday Inn rented out for a pyramid scheme about knives or perfume. Whereas on Wednesday night, the Bitcoin Fireside Chat was hosted in the former Bank of New York building, a beautiful monument to Wall Street. The high walls were adorned with murals depicting 18th century free enterprise. Massive chandeliers hung over the sold-out crowd. Many among the audience were venture capitalists, PR reps for the speakers and professional reporters. In the corner there was a lonely cypherpunk, the only person not in business or business casual, wearing a hoodie adorned with a logo of a failed libertarian project to take over New Hampshire.

bitcoin1_feb11_2015The Satoshi Roundtable, Photo: @Tether_to

Former Secretary of the Treasury Lawrence Summers (his signature is on your Clinton-era dollar bills) took aim at the anti-government types almost immediately. “Bitcoin emanates from a hyper-libertarian tradition and will have to leave it behind to succeed,” he said.

With Coinbase, a major bitcoin exchange, now sitting on traditional venture capitalist investment, the startup CEOs on the panel have become the new heirs to the virtual currency. They were now alongside the very definition of the established financial world, and wore the same outfit: a nice suit and shiny leather shoes. The only difference was that the startup CEOs didn’t wear ties.

museumThe Museum of American Finance, Photo: @financemuseum

The cyber-libertarians that promise us the death of the established order were mocked openly. There’s a “highly flawed notion that bitcoin could transcend governments,” said Summers.

At the end of the Satoshi Roundtable participants took a group photo and labeled it “The Establishment’s Worst Nightmare.” But on Wednesday night, the Establishment wasn’t afraid. It was excited. Its members swarmed the CEOs after the panel ended to exchange business cards. Nothing is more traditional finance than that.

We’re at a junction: bitcoin may or may not be the future of virtual currency. As Summers said, it might be like Betamax — technically superior tape format, lost to VHS; non-QWERTY keyboards can’t beat the inertia of QWERTY.

If this is true, then where will the cyber-libertarians go? Some might stay. Some might migrate to other coins (Circle’s CEO called them “Sons of Bitcoin”). In the end, bitcoin is not the Establishment’s worst nightmare. It’ll throw cash and join in. And if bitcoin fails, the suits will find new jobs, and the cycle will start again.

(Photo: Valary)