Author: Vanity Fair
Compiled by: Moni
Original title: VIP Believers in the Crypto Winter: Billions Evaporated, Why Are They Still Holding On?
"I really can't hold on any longer."
In the first few days of February this year, the Signal inbox of a large crypto market maker was flooded with dozens of such messages. The crypto market plummeted another 15%—within days, $400 billion in market capitalization vanished into thin air. In the previous four months, dragged down by Bitcoin, the total market capitalization of cryptocurrencies had plummeted by nearly 50%, with Ethereum and Solana both falling close to 60%. This crash wiped out approximately $2 trillion in value, dragging the industry into a bear market, which the circle calls the "winter"—a somewhat nerdy metaphor paying homage to that unsettling line from *Game of Thrones*: "Winter is coming."
Project founders were in a panic: some urgently tried to go private, some hastily launched emergency equity financing, and others simply abandoned ship and left. Frankly speaking, crypto industry veterans have experienced more severe crashes—the market has fallen 80% or even 90% before—but this time, the chill felt particularly different.
Coinbase CEO Brian Armstrong, while tangling with regulators in Washington, watched his personal net worth evaporate by about $10 billion. Undercurrents of internal conflict surged within Ethereum, with co-founder Vitalik Buterin tweeting about fries, expressing concerns about the platform's scaling methods; as an early supporter of Polymarket, he expressed distaste for the direction blockchain prediction markets were becoming addicted to. Ordinary traders were dismissed by industry elders as "tourists," either panic selling or turning to trendier hotspots like artificial intelligence and prediction markets.
Technology without faith and spiritual sustenance is nothing. What we have built is a religious movement.
"They are all cowards."
Early crypto investor and current founder of Crucible Capital, Meltem Demirors, thus evaluated those peers who fled in panic. She wore layered diamond crosses, a black tracksuit, with the company slogan—"Keep the Faith"—emblazoned on the hip.
In this crypto winter, she started buying Bitcoin again.
One afternoon in February, as the market continued to fall, a small group of true believers gathered in a Beaux-Arts landmark building in Manhattan's Lower East Side—once a bank called the "Temple of Capitalism," now transformed into the Nine Orchard hotel with a $300 million investment, with Galaxy Digital CEO Michael Novogratz becoming its new co-owner.
After collectively seeing their paper wealth shrink by billions, Michael Novogratz, Meltem Demirors, and core crypto bigwigs like Olaf Carlson-Wee, "Cathie Wood," and Danny Ryan gathered to exchange insights—they weren't talking about what they sold, but what they were buying.
Cathie Wood, holding a wealth of exclusive research data, and Olaf Carlson-Wee, who insisted he never pays attention to the news, were both continuously adding to their Bitcoin holdings. Danny Ryan was utterly indifferent to daily fluctuations: "I'm a Luddite," he declared, "If I need to know something, someone will tell me."
"Technology without faith," Meltem Demirors emphasized again, "technology without a spiritual core, is worthless." Unlike the disciples who doubted Jesus's resurrection, the faithful believers of crypto never wavered. "Seriously, what we built was originally a religious movement."
Gold, commodities, real estate, bonds, stocks—all asset classes answer the same question: where does value come from? In fact, they are products of social consensus; they only have meaning because of collective agreement.
Gold: value stems from nature and scarcity; Bonds: stem from institutional trust; Real estate: stems from land and permanence; Commodities: stem from the material itself; Stocks: stem from human creativity.
Every asset needs a creation myth, from scarcity to capitalism itself. And in the eyes of those who firmly believe that cryptocurrency is the "sixth asset class," its value goes far beyond the financial level. "I've been waiting for this day since 1971 when the dollar was decoupled from gold." Cathie Wood recalled that Arthur Laffer, the Reagan-era economics authority and proposer of the Laffer curve, once said to her. Cathie Wood's actively managed ETF is heavily invested in disruptive technology. She asked Arthur Laffer: "How big can this concept really be?" The other's answer spoke to the ultimate fantasy of early crypto believers: "You tell me, how big is the US monetary base?"
On Halloween 2008, six weeks after the bankruptcy of Lehman Brothers—the fourth largest investment bank in the US—the myth of institutional security completely collapsed. A mysterious person using the pseudonym Satoshi Nakamoto quietly sent a 9-page PDF document to a few cryptographers, titled *Bitcoin: A Peer-to-Peer Electronic Cash System*. This "whitepaper" outlined a new financial system that completely bypassed central institutions like banks, governments, and the Federal Reserve, allowing ordinary people to be free from the whims of inflation, asset freezes, and monetary policy. Bitcoin secures itself through "mining"—specialized computers competing to solve cryptographic puzzles—while asset access relies on a unique mnemonic phrase: lose the phrase, and the funds are permanently lost; remember it, and you can retrieve your wealth anywhere in the world without permission.
In 2009, Satoshi Nakamoto turned Bitcoin from theory into reality, mining the genesis block. After the rules were established, the anti-counterfeiting mechanism was implemented, and Bitcoin began to circulate (still worthless at the time), he disappeared completely. This retreat not only deepened Bitcoin's mythical quality but also gave it true decentralization: there was no omnipotent controller anymore; this experiment belonged to everyone and no one.
"I fell in love with Bitcoin at first sight," said Erik Voorhees, founder of the ShapeShift exchange and Venice AI. In 2011, he discovered Bitcoin while participating in the libertarian Free State Project in New Hampshire. "I thought Bitcoin could conquer the world. It cannot be devalued, no individual or institution can manipulate it, no one can stop it."
This movement took root on the fringes of society, its followers a group of post-financial-crisis rebels: disillusioned with reality, craving social and political change. Early believers were mostly young, male, deeply internet-addicted, cryptopunks on forums, building their own information cocoons,坚信 cryptography could achieve what regulators never did: redistribute power—Michael Novogratz, wearing a new Valentino red suit, described it: "Bitcoin is like the Rebel Alliance in *Star Wars*."
From "Fringe Rebels" to Mainstream Force
Carlson-Wee, founder of crypto hedge fund Polychain Capital, said: "Once you truly understand Bitcoin, you can no longer look away." In 2011, as a senior at Vassar College, he first encountered Bitcoin on online forums and quickly became convinced that cryptocurrency was the future of global finance, even persuading his thesis advisor to allow him to write his graduation thesis on it. After graduation, Carlson-Wee worked as a lumberjack in Washington state, cold-emailing his resume and thesis to the startup Coinbase, which was still operating out of an apartment in San Francisco at the time, and was hired within days as the company's first employee. "In those early days, it felt like everyone was guarding a secret the world didn't know yet."
As the "Occupy Wall Street" movement sounded the alarm on worsening wealth inequality in the US, the ideals of financial autonomy and global inclusive finance advocated by cryptocurrency also resonated with a generation—they had watched trillions of dollars in household wealth evaporate, while the government bailed out the banks. "My first day on the trading floor was the day after Lehman Brothers collapsed," said Arthur Hayes. At the time, he was stranded on a remote Japanese island, snowed in, unshaven, wearing a red thermal T-shirt. "A special way to start a financial career."
Arthur Hayes once aimed firmly for traditional finance: Wharton School, Deutsche Bank, Citigroup. But witnessing colleagues being laid off during the market crash turned him towards assets he could control himself—first gold, then Bitcoin in 2013. In 2014, unemployed, he crashed on a friend's couch.
The 28-year-old Arthur Hayes co-founded BitMEX, introducing Wall Street-level leverage and derivatives into crypto trading, ultimately creating the "perpetual swap." Traders didn't need to hold Bitcoin; they just needed to bet on its price rise or fall with 5x, 50x, or even 100x leverage. "Some people lost everything, some got rich overnight," Arthur Hayes said flatly; the fate of early believers was often decided in minutes.
The "perpetual swap" product exploded in the market, creating a scale of trillions of dollars and spawning a new generation of "crypto gamblers"—willing to take huge risks, occasionally winning millions.
Cryptocurrency had thus become a casino.
No one is in control, so who decides the future? This is the core of crypto, and also its fatal flaw. Divisions are everywhere, from ethical application scenarios to whether the Bitcoin ecosystem should expand to include new tokens. But it was this motley alliance—libertarians, venture capitalists, builders, traders, scammers—that ultimately pushed cryptocurrency into the mainstream.
In the same year that Arthur Hayes made Bitcoin more like gambling than gold, 20-year-old Vitalik Buterin—slender, a Thiel Fellowship recipient, who looked like he should have been on the Balenciaga runway in the登巴 era—completely颠覆 the industry.
One day in 2014, Joseph Lubin took Michael Novogratz to Brooklyn to meet members of the Ethereum Foundation—the following year, the Ethereum platform officially launched. Through "smart contracts"—self-executing code running on the blockchain—Ethereum allowed developers to build complete financial systems: lending platforms, digital art markets, autonomous organizations. No banks, no corporate overlords, only code.
"Joseph Lubin almost underwent a religious conversion," Michael Novogratz said. "Ethereum will change the world, save the world." The entire economic system migrates on-chain, stablecoins support fragile third-world currencies, open-source finance replaces the opacity of traditional banks. "I was already wealthy, I didn't need the world to be saved, but I thought, this Ethereum thing is kind of interesting."
"I didn't have a eureka moment with Bitcoin," said Danny Ryan, co-founder and president of Etherealize. The temperature in New York was below zero; he had his hair braided, wore a thin black T-shirt and a denim jacket, and a plastic yellow nose ring he claimed helped with breathing. Danny Ryan's awakening moment came in 2016 when he discovered Ethereum. In January 2017, he threw himself into Vitalik Buterin's foundation and was soon hired—just as cryptocurrency burst into the mainstream.
"It was a crazy golden age," recalled Meltem Demirors.
At a conference in November 2017, she watched Ethereum "geeks" in unicorn T-shirts and Hawaiian shirts help investors from Goldman Sachs and a16z set up MetaMask wallets and participate in initial coin offerings.
Subsequently, Bitcoin broke through $10,000, and the total market capitalization of cryptocurrencies soared from $16 billion to a peak of $535 billion, an annual growth rate of over 3200%.
The emergence of Ethereum meant the crypto world no longer had only one token, one creation myth, one idea. Anyone could build anything, breaking singularity but also tearing apart cohesion. The US government has always been at a loss with this industry, whose initial purpose was to evade centralization; in the eyes of regulators, cryptocurrency is an impenetrable web of scams.
In the following decade, the market swung repeatedly between狂热 and crash, countless people's life savings were wiped out, while a select few who precisely caught the wave created generational wealth. And within the crypto ecosystem, the cracks were huge: OGs vs. tourists, idealists vs. scammers, builders vs. traders.
Two Types of People in the Crypto Community: Believers and Scammers
There are two types of people in the crypto community—
The first type is believers: those who philosophically agree with Bitcoin's original ideals, care about decentralization, privacy, and individual sovereignty. They are vilified precisely because the principles they uphold conflict with many modern institutions (especially governments and their allied fiat banks).
The second type is scammers: those driving Lamborghinis selling meme coins, utterly unprincipled, mostly entering the scene after 2017. From outright scammers, to slightly speculative ones, to ignorant fools.
A crypto holder using the pseudonym "Moose" pulled out a Palau ID card—this was a document from the Pacific island nation of Micronesia he bought online for $200, and it was his credential for accessing offshore derivative platforms unavailable to US users. "Everyone does this," he said. At 27, like many men his age, he first encountered cryptocurrency in the mid-2010s buying drugs and fake IDs on the Silk Road website. His idols weren't athletes or movie stars, but anonymous Twitter accounts—anime avatars, cryptic bios,粉丝们虔诚地追踪其交易动向.
Jordan Fish operates at another level within the same circle, under the网名 "Cobie"; his Telegram avatar is a jumping white puppy. He made early profits staking on Ethereum protocol Lido and later founded the membership-based crypto investment platform Echo, valued at over $300 million. "In 2019, being a cryptobro was still kind of cool, but now, it's not cool at all."
As crypto moved from the fringe to the mainstream, then to a cultural punchline, its promise of disruptive innovation gradually faded. Those who once called themselves rebels increasingly resembled other deeply internet-addicted youth: gaming, memeing, trading—the糟糕的形象 was the icing on the cake.
In 2023, Arthur Hayes's狂欢派对 at the Singapore TOKEN2049 conference attracted thousands, depleting the alcohol within the first hour, until security personnel had to fend off drunk, determined people trying to get in, almost scaling the walls to break in. Two years later at the same conference in Dubai, Carlson-Wee shuttled between California and the UAE (reportedly working on projects with the local government), partying on the Lotus superyacht, accompanied by DogeOS CEO Jordan Jefferson, who wore what he called a "Habibi Doge" T-shirt—a shiba inu wearing a traditional UAE headscarf. (A UAE-linked company had injected $500 million into the Trump family's crypto project before his inauguration.)
"Everyone thinks that if you make money in crypto, you'll be on a yacht in Miami surrounded by a hundred prostitutes. During the Cannes Ethereum conference, I spent three consecutive days泡在拉盖里特餐厅," Meltem Demirors said. "I got completely drunk, crawling on the dining table. Ethereum believers hate beautiful things, hate pleasure, they just want you to eat tofu, wear organic cotton, torture yourself."
There's Another Creature in the Crypto Circle: The "Whale"
Whales are the behemoths of the Bitcoin world.
In crypto slang, a whale refers to someone holding over 1,000 Bitcoins; they often possess digital assets worth over $10 billion, and a single transaction can shake the market. These whales are completely anonymous, never attend conferences, throw parties, or post controversial tweets: the noisiest voices in crypto are never the wealthiest.
Anonymity, once an ideological反抗理念 against centralization, has now also become a survival necessity. Being visible in the crypto circle is asking for trouble. Dozens of violent incidents occur in the industry every year: kidnappings, home invasions, armed robberies. Massive data leaks expose asset holdings, turning digital wealth into real-world targets. Last year, a crypto holder in Nolita claimed to have been kidnapped, tortured for two weeks to extract passwords, and narrowly escaped.
"I no longer be a public figure," Fish said, because "it could very likely lead to personal danger." OpenSea co-founder Devin Finzer and his wife Yu-Chi Lyra Kuo travel with a burly bodyguard who looks more like a Viking pirate than a Secret Service agent. "That's our bodyguard."
There are long-term survival rules in the crypto circle; the secret is: never be the protagonist. I'm a supporting character; everyone knows me, but no one really knows why I exist.
On the morning of the *Vanity Fair* magazine shoot party, Cathie Wood didn't recognize Meltem Demirors, whom she hadn't seen in ten years. "You look younger instead," Cathie Wood said, hugging her. "Because I have money now," Meltem Demirors replied with a smirk. Carlson-Wee, like a little boy meeting his idol, meekly introduced himself to Cathie Wood, and the two immediately started talking about the days when everyone thought they were crazy, their shared belief in "buying when the market falls"—gently sidestepping the reality that cryptocurrency had fallen nearly 50% in three months.
Michael Novogratz strode in wearing a silver down coat, greeted everyone warmly, then complained he was on the second day of a severe hangover—he described the Saturday night狂欢, the climax being a 4 a.m. visit to the Burning Man-inspired New York nightclub Gospël, praying his 30-year-old daughter and new son-in-law living nearby didn't see it.
Ryan stayed in a corner of the room, watching with an expression both amused and horrified. Meltem Demirors and her assistant looked through the clothes they brought. Michael Novogratz纠结 between a bedazzled black suit and Valentino, while Ryan only brought two pairs, his favorite pair with a hole in the crotch, which he wore anyway. "It's too hot," he complained barefoot, as a hairstylist blow-dried his shoulder-length hair.
"Where's Devin Finzer?" Meltem Demirors inquired.
Devin Finzer and his wife Yu-Chi Lyra Kuo were in a private suite on the fourth floor, with dedicated assistants, security, celebrity makeup artists, surrounded by haute couture clothing.
Finally, after considering millions of dollars worth of haute couture, Yu-Chi Lyra Kuo chose a non-couture Armani gown and didn't wear any JAR jewelry either.
In 2017, Devin Finzer founded the NFT marketplace OpenSea—in the eyes of crypto OGs and even his wife, he missed the key threshold to become an OG. His background was a Silicon Valley mother's dream: grew up outside San Francisco, graduated from Brown University, majored in computer science and mathematics, former Pinterest software engineer.
When the crypto market exploded, Devin Finzer and his friend Alex Atallah decided to build a digital asset version of eBay. Inspired by the tokenization on Ethereum, especially the craze of the digital cat trading platform CryptoKitties, OpenSea was born.
Soon after, the COVID-19 pandemic broke out. Hordes of bored young people flooded into the crypto universe, and NFTs took off.
In 2021, Beeple's NFT artwork sold for $69 million at Christie's, profile pictures like Bored Ape Yacht Club and CryptoPunks became status symbols on par with Rolexes and Porsches, some even spending over $1 million on a stone clip art image.
In January 2022, OpenSea's valuation soared to $13 billion. That same year, the young Devin Finzer was struggling to keep up with the rapidly expanding company, suddenly跻身 the top echelons of Silicon Valley social circles, where he met Yu-Chi Lyra Kuo.
"Yu-Chi Lyra Kuo is like a Ferrari engine in a Spice Girl's body," Devin Finzer said.
Yu-Chi Lyra Kuo said that even before the 2022 crypto crash and NFT bubble burst, she had expressed concerns about OpenSea to Devin Finzer, but no one listened. She believed OpenSea was too trend-following, that Devin Finzer was immature and short-sighted, failing to pivot quickly enough to a more lasting direction.
"Everyone was hyping Devin Finzer, *Forbes* cover, 29 years old, good-looking, everyone wanted to charter planes to send him to the Super Bowl, to every dinner party." Yu-Chi Lyra Kuo paused. "I'm not interested in these things."
"It's been a humbling journey," Devin Finzer added softly. "Even when everyone puts you on a pedestal, you still have so much to learn."
The market collapse had been brewing for months—
In 2021, Bitcoin fell from its peak of $69,000 to $16,000, ushering in the industry's harshest winter. OpenSea's valuation plummeted by about 90%.
In May 2022, Terra/Luna collapsed, wiping over $40 billion in value from its ecosystem within 72 hours, leaving global retail investors with nothing. One of crypto's largest hedge funds, Three Arrows Capital, subsequently went bankrupt.
In November 2022, the industry darling SBF's exchange FTX collapsed spectacularly, falling apart within a week. He was eventually arrested, convicted on seven counts of fraud and conspiracy, having stolen up to $10 billion in customer funds.
"Devin Finzer isn't the first天才少年 I've mentored," Yu-Chi Lyra Kuo said without elaborating. As the company crumbled and the NFT bubble burst, Yu-Chi Lyra Kuo became Devin Finzer's "product mom," treating him like a "custom bear." Now, they宣称 to relaunch OpenSea with a grander vision.
However, not everyone has the certainty of Devin Finzer and Yu-Chi Lyra Kuo.
The more mature the blockchain infrastructure becomes, the harder it is to explain what OpenSea can offer that trading platforms like Coinbase and Gemini cannot. Successful projects have raised the bar—like Hyperliquid, Uniswap—now sharing profits with token holders. Most tokens cannot compete; issuance is mainly for governance, with holders only able to vote on protocol decisions, without direct economic rights.
FTX's collapse not only plunged the entire industry into the abyss but also triggered what the crypto circle calls a "witch hunt": regulatory agencies协同出击, trying to strangle a technology they neither understood nor could control. Regulators, on the other hand, believe the crypto world is the Wild West, and even if the rules aren't perfect, protecting US investors is a good start.
Biden appointed Gary Gensler to head the US Securities and Exchange Commission—a former Goldman Sachs partner and MIT blockchain professor who understands cryptocurrency better than any other regulator. Gary Gensler's goal is to tame this industry. The core question is: are cryptocurrencies securities or commodities? The answer determines everything: securities fall under the SEC's purview; exchanges and token issuers need to register, disclose, and comply with investor protection rules designed for stocks—rules created for centralized institutions, not assets that can flow globally without banks, brokers, or borders.
Applying traditional financial regulatory models to a technology whose core is autonomy, privacy, anonymity, and breaking global boundaries is doomed to fail. The crypto circle calls it "regulation by enforcement": Gary Gensler accused multiple companies of violating securities laws, forcefully squeezing crypto-friendly banks out of the system.
"The SEC当时 wanted to litigate crypto into extinction," Ryan said. He recalled setting the dinner table on Easter Sunday 2024 when he received a subpoena. "I was the highest-ranking person from the Ethereum Foundation in the US."
Arthur Hayes was sentenced to six months of home confinement in May 2022 after pleading guilty to willfully failing to implement anti-money laundering controls at BitMEX—specifically, BitMEX allowed US clients to access the platform via VPN. He had once boasted at a conference that bribing Seychelles officials was cheaper than complying with US regulations. Binance CEO CZ fared worse, sentenced to four months in federal prison in April 2024 for aiding money laundering, with Binance paying a $4.3 billion fine, one of the largest corporate fines in US history.
Then, Trump made a comeback. In 2021, he called Bitcoin a scam, but just three years later, he gave a keynote speech at a Bitcoin conference, promising to make the US the "crypto capital of the world." Although Trump's values run counter to the global utopian vision of crypto believers, his support for the industry was enough to win votes.
"No political party in the US is inherently pro or anti-crypto," Arthur Hayes said. If crypto investors become single-issue voters, the question for politicians is only one: "Do you want to win them over?"
"I'm probably the only person in crypto who didn't vote for Trump," Michael Novogratz said. As a major donor to progressive causes, he had spent years trying to convince Elizabeth Warren to meet with him about the industry, but all failed. "This industry is still full of political controversy; it shouldn't be. It should be a bipartisan consensus. We need rules; the lack of innovation is because there are no rules."
In the final months before Trump's re-election, Ryan received a letter: the case was dismissed. Ryan's lawyer said he had never seen the SEC act like this. "The best outcome is that they stop contacting you." This time, the securities fraud charges simply disappeared.
According to Ryan, the Biden administration realized the US presidential race was extremely close and could no longer afford to alienate an entire tech industry. The crypto industry ultimately poured $135 million into the 2024 election, reportedly大部分流向 Republican candidates, with a win rate of over 90% in supported districts.
In 2025, Trump launched his own Meme coin, TRUMP, whose market capitalization once surged to $10 billion but later crashed 80%. After taking office, he pardoned Arthur Hayes and CZ (SBF remained in prison).
Conclusion
In different people's eyes, as cryptocurrency渗透 mainstream institutions, it is either a complete betrayal of its original intent or proof of the experiment's success. Some of the most staunch decentralization believers now appear in White House closed-door meetings. Those holding cryptocurrency are not only ordinary people but also sovereign wealth funds, family offices, corporations with private wealth managers. This movement, born to make Wall Street obsolete, has become its most powerful lobbying force and most reliable client.
"We won," Moose said. "But after winning, does cryptocurrency just become another ordinary asset class?"
Has the crypto industry become what it once hated? Or is it changing the world from within?
In the winter, the answer is still blowing in the wind, and those believers remain standing firm, holding on to their faith.
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