Miami nightclub owners are facing slumping sales and dwindling revenue as the crypto rich are veer away from entertainment venues amid the recent collapse of FTX and the broader crypto market downturn.
According to a new report from the Financial Times, crypto entrepreneurs who spent big at Miami nightclubs by renting an entire venue for a whole evening have gone quiet.
“Out of the blue, all these kids from crypto started coming down and spending a lot of money — like, an insane amount of money,” said Andrea Vimercati, director of food and beverage at Moxy Hotel group. “They were booking tables for $50,000, and it was like, who the hell are these people.”
At the time, crypto prices were near all-time highs. The flagship cryptocurrency was trading at around $60,000 while Ethereum was near $4,000.
However, following the recent collapse of FTX, once the third-largest cryptocurrency exchange in the world, crypto prices went into a free fall. Bitcoin has plunged to below $16,000, down by 75% compared to its all-time high of around $70,000.
According to the club owners, the crypto kids, who were “95 per cent men, young . . . with a kind of nerdy style,” have “completely disappeared.”
“They wanted to show that they didn’t have any limits,” recalled Vimercati. “They were ordering 12 or 24 bottles of the most expensive champagne and just showering themselves without even drinking.”
As per the report, E11even, a famous nightclub in Miami, started accepting payments in cryptocurrency in April 2021. The club processed more than $6 million worth of transactions last year, but less than $10,000 over the past three months.
Aside from spending money in nightclubs and entertainment venues, the crypto rich kids also flooded their money into other parts of Miami’s luxury scene, namely real estate, cards, and even big yachts.
“They bought big houses for $25mn plus, they rented big yachts . . . they had money and were spending it lavishly,” said Brett Harris executive director of luxury sales at real estate firm Douglas Elliman. “They were buying big houses in cash, no financing — converting Bitcoin into cash to buy.”
As reported, Sam Bankman-Fried, former CEO and founder of collapsed crypto exchange FTX, has recently revealed that he currently has around $100,000 in his bank account. His wealth peaked at an estimated $26.5 billion last year.