How I Blew My Bitcoin on Sushi

The year of hell that is 2020 has wrecked havoc on life as we know it. But you know what he’s been good at? Bitcoin.

The cryptocurrency has been soaring, hitting a high of over $ 20,000 a penny this week. There is now more than $ 350 billion worth of Bitcoin in the world, an incredible appreciation for virtual currency that was basically worth nothing a decade ago.

It’s a great time to be a long-time owner of the currency, and a painful time to be the person who spent 10.354 Bitcoin (including a tip) on a dinner for strangers. Yeah, I’m that person.

Back in May 2013, I spent in one night what would be worth about $ 200,000 today on raw fish and shrimp tempura rolls for people I had just met. I was a reporter in Forbes magazine at the time dealing with technology and privacy. Bitcoin had come on my radar as a privacy protection technology allowing people to buy anonymously online, similar to paying cash in the real world. (Except it includes a huge public digital ledger that never disappears.)

The digital currency was invented in 2009 by a mysterious math fanatic who went by the nickname Satoshi Nakamoto. By 2013, the value of single Bitcoin had climbed to over $ 100, thanks in part to its popularity on online black markets like the Silk Road virtual drug bazaar (which was clearly very illegal and which was shut down in later by the federal authorities).

Technicians, entrepreneurs, investors and economists were starting to get excited about Bitcoin, so I decided to try to live on the currency for a week to find out how valuable it was in the real world.

I bought a bunch of Bitcoin for $ 136 dollars each at a site called Coinbase and tried to find ways to spend them. There weren’t many places that knew what Bitcoin was, much less accepted it for purchases, but because I was living in San Francisco’s tech mecca at the time, I had a couple of options, including a store a cupcake and a sushi restaurant called Sake Zone.

Still, the week living on Bitcoin was tough: I had to move out of my apartment into a hacker hotel that was still under construction. I lost five pounds, both because of the limited food options and because my only transportation options were walking or riding a bike that a friend rented to me for half Bitcoin. And I was constantly deprived of caffeine because I couldn’t find anywhere selling coffee for cryptocurrency.

On the last night of my experiment, Monday, I decided to celebrate the end of the week by throwing dinner at Sake Zone with my remaining crypto-stash. I extended an open invitation on Meetup and to a community of Bitcoin enthusiasts on Reddit.

I had called the restaurant owner, Yung Chen, in advance to make sure it would be okay to make a group dinner and pay for it in Bitcoin. I had told him it was likely to be 15 people.

But when I got to the little restaurant on Clement Street in the Richmond District, two dozen people were already outside. Then more than 60. As I wrote at the time, it was a “wild cast of characters,” including “Bitcoin speculator pulled out in Google Glass,” economists, entrepreneurs making Bitcoin apps and games, and two Burning founders Man.

A Forbes videographer named Taylor Soppe filmed it all, and I played anchor, looking tired.

At the end of the night, I paid the bill, which came to $ 957 (plus tip). I felt guilty at the time, making Yung Chen receive $ 1,000 worth of funny money because it was unclear to me whether Bitcoin should be worth anything at all.

My conclusion at the end of the experiment was that Bitcoin was an incredibly useful demonstration of how a secure, distributed, peer-to-peer ledger – Bitcoin’s basic technology, called the blockchain – could work to keep track of online ownership. You could use Bitcoin technology for car titles or housing deeds, transferring car or house ownership in seconds rather than the ancient process of standing in lines forever in government agencies. But Bitcoin as a store of value? That seemed silly. I didn’t buy the arguments that Bitcoin is like gold.

In fact, I wonder: Did I just cheat this restaurant?

Fast forward to 2020. This month, with Bitcoin surging, I called on Yung Chen to look into it. He and his wife retired from the restaurant business a few years ago, tired of the long hours, he said. They were able to partially thank their cryptocurrency earnings of about 41 Bitcoin in total.

In 2017, after they closed Sake Zone and when Bitcoin was worth a few thousand dollars, Mr. Chen sold about a quarter of his Bitcoin. He now regrets that decision given how much the digital currency has appreciated.

“I sold some. I feel so bad, ”he said. “Now, I’m just keeping it. I just put it there as stock and wait. “

“Bitcoin has become one of the major savings assets in my portfolio,” he added. “It’s a lot. It’s close to like half a million dollars in my account. ”

Mr Chen’s wife, 54, is fully retired, but Mr. Chen, 63, still works, for the city of Oakland as a pavement inspector, a job he has held for nearly two decades.

When I asked him why he had been an early believer in Bitcoin, he explained that he had experience in the technology sector. He emigrated from Hong Kong to California in 1984 to go to the University of California, Berkeley, and one of his early jobs was testing routers for telephone companies.

“I did a little bit of technology,” he said. “That’s why when they introduced me to Bitcoin, I thought ‘Why not? We can do that. ”

The people who introduced the Chens to Bitcoin were employees of the Internet Archive, a not-for-profit company based in a renovated church next door to Sake Zone.

The Internet Archive wants to archive, well, everything: The internet in general with the Wayback Machine, which houses old versions of websites; books, to the displeasure of the people who make money from them; old television news; and on and on. The Archive had begun receiving cryptocurrency donations years earlier, and had even begun paying some employees partly in Bitcoin. Because many of them eat lunch at Sake Zone every day, they talked to the Chens to accept it.

“You need to know your neighbors,” said Mr Chen. They tried to convince other traders in the neighborhood, but did not find many others.

“At that time, the concept around Bitcoin was still relatively new. And most people don’t want to take risks, ”said Mr Chen. But he had seen firsthand how fast technology could change the world. He said he “didn’t really think about money. More like a new product that I like to play around with. ”

The Internet Archive helped the Chens set up a Bitcoin account and provide them with a free Wi-Fi service so they could make the Bitcoin transactions.

“I tried to get the whole street going,” said Brewster Kahle, director of the Internet Archive. He dreamed that Bitcoin would be the currency of the Web, and that it would help create a financial system that was not controlled by governments and large corporations. He said that dream was dead.

“It’s a speculative system now,” said Mr Kahle, 60. “It’s just gambling. It’s just like the stock market. ”

I asked Mr Chen for dinner night and told him how guilty I felt at the time paying such a large bill with money that most people didn’t know existed and most people didn’t take it seriously if they do.

“I didn’t worry about that,” he said. “Compared to our regular sales, it was a small amount.”

“At that time, Bitcoin was not big money,” he added. “Now it’s big money.”

I don’t know that. Burp!