VIP Believers in the Crypto Winter: Trillions Evaporated, Why Do They Still Hold On?

Compiled by | Odaily (@OdailyChina); Translator | Moni

“I really can’t hold on any longer.”

For several days in early February this year, the Signal inbox of a major crypto market maker was flooded with dozens of messages like this. The crypto market had plunged another 15%—wiping out $400 billion in market cap in just a few days. In the preceding four months, dragged down by Bitcoin, the total cryptocurrency market cap had plummeted nearly 50%, with Ethereum and Solana both falling close to 60%. This crash erased about $2 trillion in value, dragging the industry into a bear market, what crypto circles call a “winter”—a slightly nerdy metaphor paying homage to the unsettling line from *Game of Thrones*: “Winter is coming.”

Project founders were in a panic: some urgently tried to go private, others hastily launched emergency equity financing, and some simply abandoned ship and left. Frankly, crypto industry veterans have experienced more severe declines—the market has crashed 80% or even 90% before—but this time, the chill felt distinctly different.

Coinbase CEO Brian Armstrong, while battling regulators in Washington, watched his personal net worth evaporate by about $10 billion. Undercurrents of internal conflict swirled within Ethereum, with co-founder Vitalik Buterin firing off a series of “french fry” tweets expressing concerns about the platform’s scaling approach; as an early supporter of Polymarket, he expressed distaste for the direction blockchain prediction markets were heading, which he saw as highly addictive. Ordinary traders were dismissed by industry elders as “tourists,” either panic-selling or pivoting to trendier hotspots like AI and prediction markets.

Technology without faith and spiritual sustenance is nothing; what we built is a religious movement

“They’re all cowards.”

Early crypto investor and current Crucible Capital founder Meltem Demirors said this about her panicked, fleeing peers. She wears stacked 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 February afternoon, as the market continued to slide, a small group of true believers gathered in a Beaux-Arts landmark building in Manhattan’s Lower East Side—once a bank dubbed the “Temple of Capitalism,” now a $300 million renovation turned into the Nine Orchard hotel, with Galaxy Digital CEO Michael Novogratz as its new co-owner.

After collectively seeing tens of billions in paper wealth evaporate, Michael Novogratz, Meltem Demirors, and other crypto core figures 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, armed with extensive proprietary research data, and Olaf Carlson-Wee, who insists he never pays attention to the news, were both continuing to accumulate Bitcoin. Danny Ryan was utterly indifferent to daily volatility: “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, crypto’s true believers never wavered. “Seriously, what we built was meant to be 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, meaningful only because of collective belief.

Gold: value from nature and scarcity; Bonds: from institutional trust; Real estate: from land and permanence; Commodities: from the material itself; Stocks: from human creativity.

Every asset needs a creation myth, from scarcity to capitalism itself. And in the eyes of those who firmly believe cryptocurrency is the “sixth asset class,” its value extends far beyond the financial. “I’ve been waiting for this since 1971 when the dollar was decoupled from gold,” Cathie Wood recalled, Reagan-era economics authority and Laffer Curve proponent Arthur Laffer once told her. Cathie Wood, whose actively managed ETFs are heavily weighted towards disruptive tech, asked Arthur Laffer: “How big can this idea really get?” His answer captured the ultimate fantasy of early crypto believers: “Tell me, what’s the size of the U.S. monetary base?”

On Halloween 2008, six weeks after Lehman Brothers—the fourth-largest U.S. investment bank—collapsed, shattering the myth of institutional safety, a mysterious figure using the pseudonym Satoshi Nakamoto quietly sent a 9-page PDF document titled *Bitcoin: A Peer-to-Peer Electronic Cash System* to a handful of cryptographers. This “white paper” outlined a new financial system completely bypassing central institutions like banks, governments, and the Federal Reserve, allowing ordinary people to escape 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 seed phrase: lose the phrase, funds are gone forever; memorize it, and you can retrieve your wealth permissionlessly anywhere in the world.

In 2009, Satoshi Nakamoto turned Bitcoin from theory into reality, mining the genesis block. Once the rules were set, anti-counterfeiting mechanisms were in place, and Bitcoin began circulating (still worthless at the time), he vanished completely. This disappearance not only deepened Bitcoin’s mythos but granted it true decentralization: no omnipotent controller, this experiment belongs 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. He discovered Bitcoin in 2011 while participating in the libertarian Free State Project in New Hampshire. “I thought Bitcoin could conquer the world. It can’t be devalued, no individual or institution can control it, no one can stop it.”

This movement took root on society’s fringes, 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, forum-dwelling cypherpunks who built their own information silos, convinced cryptography could achieve what regulators never could: redistribute power—Michael Novogratz, dressed in a new Valentino red suit, described it: “Bitcoin is like the Rebel Alliance in *Star Wars*.”

From “Fringe Rebels” to Mainstream Force

Crypto hedge fund Polychain Capital founder Carlson-Wee said: “Once you truly understand Bitcoin, you can’t unsee it.” In 2011, as a senior at Vassar College, he first encountered Bitcoin on online forums, quickly becoming convinced cryptocurrency was the future of global finance, even persuading his thesis advisor to let him write his senior thesis on it. After graduation, Carlson-Wee worked as a lumberjack in Washington state, cold-emailing his resume and thesis to the then-startup Coinbase, operating out of a San Francisco apartment. He was hired within days, becoming the company’s first employee. “Back 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 America’s widening wealth gap, cryptocurrency’s advocacy for financial autonomy and global financial inclusion resonated with a generation—they watched trillions in household wealth evaporate while the government bailed out banks. “My first day on the trading floor was the day after Lehman Brothers collapsed,” Arthur Hayes said. He was stranded on a remote Japanese island, snowed in, unshaven, wearing a red thermal shirt. “A special way to start a finance career.”

Arthur Hayes was once determined to root himself in traditional finance: Wharton School, Deutsche Bank, Citigroup. But watching colleagues get 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.

At 28, Arthur Hayes co-founded BitMEX, introducing Wall Street-level leverage and derivatives to crypto trading, ultimately creating the “perpetual swap.” Traders didn’t need to hold Bitcoin; they could just bet on its price movement with 5x, 50x, or even 100x leverage. “Some people lost everything, some made fortunes overnight,” Arthur Hayes said flatly. The fate of early believers was often sealed in minutes.

The “perpetual swap” product ignited the market, creating a multi-trillion-dollar scale and spawning a new generation of “crypto gamblers”—willing to take huge risks, occasionally winning millions.

Cryptocurrency had become a casino.

With no one in control, who decides the future? This is crypto’s core, and its fatal flaw. Disagreements are everywhere, from ethical use cases to whether the Bitcoin ecosystem should expand with 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 Arthur Hayes made Bitcoin more like gambling than gold, 20-year-old Vitalik Buterin—lanky, Thiel Fellowship recipient, who looked like he should be walking Parisian runways in the Demba era—completely upended the industry.

One day in 2014, Joseph Lubin took Michael Novogratz to Brooklyn to meet members of the Ethereum Foundation—the Ethereum platform officially launched the following year. Through “smart contracts”—self-executing code running on a blockchain—Ethereum allowed developers to build entire financial systems: lending platforms, digital art markets, autonomous organizations. No banks, no corporate overlords, just code.

“Joseph Lubin almost underwent a religious conversion,” Michael Novogratz said. “Ethereum will change the world, save the world.” The entire economic system migrating on-chain, stablecoins propping up fragile third-world currencies, open-source finance replacing traditional banking opacity. “I was already rich, I don’t need the world to be saved, but I thought, this Ethereum thing is interesting.”

“I didn’t have a ‘Eureka!’ moment with Bitcoin,” said Danny Ryan, co-founder and president of Etherealize. With New York temperatures below freezing, his long hair braided, wearing a thin black T-shirt and denim jacket, sporting a plastic yellow nose ring he claimed helped him breathe. 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 explosively surged into the mainstream.

“That was a crazy golden age,” Meltem Demirors recalled.

At a conference in November 2017, she watched Ethereum “geeks” in unicorn T-shirts and Hawaiian shirts help Goldman Sachs and a16z investors set up MetaMask wallets and participate in initial coin offerings.

Soon after, Bitcoin broke $10,000, and the total cryptocurrency market cap soared from $16 billion to a peak of $535 billion, a year-over-year growth rate exceeding 3200%.

Ethereum’s emergence meant the crypto world no longer had just one token, one creation myth, one ideology. Anyone could build anything, breaking singularity but also fracturing cohesion. The U.S. government remained helpless against an industry born to circumvent centralization; in regulators’ eyes, cryptocurrency was an impenetrable web of scams.

For the next decade, the market swung wildly between mania and collapse, countless people’s life savings wiped out, while a select few who perfectly timed the trends created generational wealth. And within the crypto ecosystem, the fissures were vast: OGs vs. tourists, idealists vs. scammers, builders vs. traders.

Two Kinds of People in the Crypto Community: Believers and Scammers

There are two kinds of people in the crypto community—

The first are believers: those who philosophically align with Bitcoin’s original ideals, care about decentralization, privacy, individual sovereignty. They are vilified precisely because their principles clash with many modern institutions (especially governments and their fiat bank allies).

The second are scammers: those driving Lamborghinis peddling meme coins, utterly unprincipled, mostly entering post-2017. From outright fraudsters, to slightly speculative, to clueless fools.

A crypto holder using the pseudonym “Moose” pulled out a Palau ID card—a $200 online purchase from the Pacific island nation of Micronesia, his credential for accessing offshore derivatives platforms unavailable to U.S. 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, followers devoutly tracking their trading moves.

Jordan Fish operates at another level within the same sphere, online alias “Cobie,” Telegram avatar a jumping white puppy. He made early profits staking Ethereum on the Lido protocol, later founding the membership-based crypto investment platform Echo, valued at over $300 million. “In 2019, being a cryptobro was still cool, but now, it’s not cool at all.“

As crypto moved from fringe to mainstream to cultural punchline, its promise of disruptive innovation faded. Those who once styled themselves as rebels increasingly resembled other deeply online youths: gaming, memeing, trading—the terrible image only made it worse.

In 2023, Arthur Hayes’ raucous party at the TOKEN2049 conference in Singapore attracted thousands, running out of alcohol within the first hour, with security eventually having to fend off drunk, insistent people trying to climb walls to get 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 alongside DogeOS CEO Jordan Jefferson, the latter wearing what he called a “Habibi Doge” T-shirt—a Shiba Inu wearing a traditional UAE headdress. (A UAE-linked company had invested $500 million in the Trump family’s crypto project before his inauguration.)

“Everyone thinks 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 at La Guérite restaurant,” Meltem Demirors said. “I got completely wasted, crawling on the tables. Ethereum believers hate nice things, hate pleasure, they just want you to eat tofu, wear organic cotton, torture yourself.“

There’s Another Creature in the Crypto World: The “Whale”

Whales are the leviathans of the Bitcoin world.

In crypto slang, a whale refers to someone holding over 1,000 Bitcoin, often possessing digital assets worth over $10 billion, capable of moving markets with a single trade. These whales are completely anonymous, never attend conferences, don’t throw parties or post controversial tweets: the loudest voices in crypto are never the richest.

Anonymity, once an ideological rebellion against centralization, has now become a survival necessity. Being public in crypto is asking for trouble. The industry sees dozens of violent incidents annually: kidnappings, home invasions, armed robberies. Massive data breaches exposing asset holdings turn digital wealth into real-world targets. Last year, a crypto holder in Nolita claimed he was kidnapped, tortured for two weeks for his password, and narrowly escaped.

“I’m no longer a public figure,” Fish said, because “it’s likely to bring physical danger.” OpenSea co-founder Devin Finzer and his wife Yu-Chi Lyra Kuo travel with a hulking bodyguard who looks more like a Viking than a Secret Service agent. “That’s our security.”

There’s a long-term survival rule in crypto: the secret is to never be the main character. 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, actually,” Cathie Wood said, hugging her. “Because I have money now,” Meltem Demirors replied with a smirk. Carlson-Wee, meekly introducing himself to Cathie Wood like a boy meeting his idol, immediately bonded over their shared past of being seen as crazy by everyone, their firm “buy the dip” conviction—g

This article is sourced from the internet: VIP Believers in the Crypto Winter: Trillions Evaporated, Why Do They Still Hold On?

Related: Polymarket vs Kalshi: Who is the King of Prediction Markets?

Prediction News reported on this, and soon after, a screenshot that was hard not to laugh at surfaced: Polymarket’s official account quietly liked this report. The business war between Polymarket and Kalshi has been ongoing for a long time, and the prediction market is truly entering an era of duopoly. On one side is the crypto-native Polymarket, and on the other is Kalshi within the compliant financial system. The essence of this competition is not about which company is stronger, but rather: who will hold the future pricing power of information, Crypto or Wall Street. Therefore, this analysis is worth doing. 👇 1. Chronicles of the Business War: From Regulatory Games to Offline Confrontations Over the past year, the competition between the two has escalated from product-level to a multi-dimensional…