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Boosters hope the limited circulation and wider acceptance of Bitcoin means that its value will increase. They are hoping that basic economics will apply: Supply is growing slower than demand, so the price should go up. One bitcoin is currently worth about $700, giving the currency a total potential market value of about $9 billion, Reuters reported not long ago. As recently as 2012, Bitcoin was changing hands for $10.
Shrem was one of the Bitcoin speculators who struck it rich. He also was a character out of a Damon Runyon story — if Runyon had written about Syrian Jews in Brooklyn. An alumnus of Yeshivah of Flatbush Joel Braverman High School and Brooklyn College, Shrem had a meteoric rise and a stunning fall. Both make “him a living symbol of the peaks and valleys that have so far defined the Bitcoin experience,” Nathaniel Popper wrote in The New York Times.
After dabbling in Bitcoin in high school, Shrem “became obsessed” and launched BitInstant, which allows purchases using Bitcoin, with help from investors, including his mother. Shrem used huge profits from BitInstant to build a Midtown Manhattan bar called EVR, which made headlines for accepting bitcoins as payment; he also became a tireless Bitcoin evangelist, extolling the currency’s virtues at events and speaking gigs across the country.
Unfortunately for him, he is alleged to have engaged “in a scheme to sell over $1 million in Bitcoins to users of ‘Silk Road,’ the underground website that enabled its users to buy and sell illegal drugs anonymously and beyond the reach of law enforcement,” according to the office of Manhattan U.S. Attorney Preet Bharara. Shrem and a co-defendant were charged with conspiring to commit money laundering and with operating an unlicensed money transmitting business; they’re currently free on bail.
Though they’re vocal about promoting their products in the press, none of the Jewish Bitcoin players would comment on Shrem when queried by the Forward. “Barry is not available for comment at this time,” wrote a representative for Barry Silbert, the Jewish founder and CEO of Bitcoin Investment Trust, the world’s largest Bitcoin investment fund.
“Sorry, Lazzerbee cannot comment on Charles Shrem. Good luck,” responded Michael Sofaer, who is the Jewish creator of Lazzerbee, a seller of Bitcoin gift certificates and greeting cards. Tel Aviv-based executives of Fiverr, a freelance and consulting marketplace that just started accepting Bitcoin, didn’t return requests for comment; neither did Shrem’s lawyer, Marc Agnifilo.
But if Shrem has proved anything in his now notorious career as Bitcoin’s most flamboyant evangelist, it’s that he can’t stay quiet for long.
Michael Kaminer is a frequent contributor to the Forward.