The Crypto Party Is Over
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The Crypto Party Is Over

The cryptocurrency industry was built on swagger, enthusiasm and optimism. All three are in short supply these days.

By CORRIE DRIEBUSCH
Mon, Jun 20, 2022 1:18pmGrey Clock 8 min

On Super Bowl Sunday, a Crypto.com ad featuring billionaire NBA star LeBron James lit up millions of Americans’ TVs. “If you want to make history, you gotta call your own shots,” Mr. James said in the 30-second spot for the popular cryptocurrency-trading platform. The words that splashed across the screen as the commercial ended read “Fortune favours the brave.”

Last week, Crypto.com laid off 5% of its workforce as its chief executive officer said on Twitter that the company was making “difficult and necessary decisions.”

The cryptocurrency industry was built in part on swagger, enthusiasm and optimism. Bitcoin backers’ rallying cry to rebuff sceptics was, “Have fun staying poor.” Those who didn’t buy in were letting the future pass them by.

At times, crypto has looked like a combination of Beanie Babies, dot-com stocks and the Velvet Underground: It is manic, it is money, and all the cool people are into it. It has also shared characteristics with other bubbles throughout history, marked by speculation bordering on delusion, disregard and disrespect for risk, and greed.

Now, with markets sliding and inflation plaguing the global economy, cryptocurrencies have been among the first assets sold. Since bitcoin hit an all-time high in November, roughly US$2 trillion of cryptocurrency value—more than two-thirds of all the crypto that existed—has been erased. Bitcoin itself has plunged to US$21,206, roughly 69% off its all-time high of US$67,802.30. Crypto exchanges are bleeding users, crypto companies are laying off workers with at least one contemplating restructuring.

The crypto world is no stranger to booms and busts, which many in the industry refer to as “winters.” But many investors and workers are feeling this crypto crash more acutely than previous ones. When the dust settles, some crypto products and companies may no longer exist.

“The reality is that like stock, with crypto, everyone is a genius in a bull market,” said Mark Cuban, who became a billionaire during the dot-com boom in the ’90s and has more recently invested in a number of crypto projects. “Now that prices are falling for both, those companies that were unnaturally sustained by easy money will go away.”

The fever pitch

Bitcoin was launched as a form of electronic money in 2009 by an anonymous creator who went by the name Satoshi Nakamoto.

Its price rose—unsteadily, haphazardly, often violently and with big crashes sprinkled throughout—as more people jumped in. Numerous factors drove the rise, but crypto investors often shared a belief that the existing financial system had failed and crypto was the future.

In April 2021, the largest U.S. cryptocurrency exchange, Coinbase Global Inc., went public with an US$85 billion valuation, becoming the first major bitcoin-focused public company. It was viewed as a watershed moment for the crypto world.

In August, the city of Miami debuted MiamiCoin, a city-branded cryptocurrency.

The cryptocurrency complex pushed individual investors hard to join in. Crypto.com’s spot featuring Mr. James was one of several crypto ads that ran during this year’s Super Bowl. Ads for crypto companies are now splashed across Major League Baseball umpires’ uniforms and several major-league and college-sports venues. Coinbase ran an ad during the NBA Finals.

In May 2020, well-known hedge fund manager Paul Tudor Jones revealed that he had a small portion of his assets in bitcoin, and called it a “great speculation.” At the time, bitcoin was trading around US$9,000. Other professional investors followed. Bill Miller. Alan Howard. Stanley Druckenmiller. Suddenly, crypto was OK for the mainstream, it appeared.

Last December, the red letters spelling out “Staples Center” were pulled down from the famed Los Angeles venue, replaced by new signs reading “Crypto.com Arena,” after a US$700 million naming-rights deal, believed to be the biggest in history.

Earlier this year, more than 25,000 people showed up for a Miami crypto conference, a slew of events across the city and the endless parties. Miami Mayor Francis Suarez presided over the unveiling of an 11-foot long, 3,000-pound, black, techno-styled bull, to rival New York’s famous one on Wall Street. The centrepiece at the conference’s expo hall was a giant, smoking, papier-mâché volcano. A party at the Versace mansion featured live music and synchronized swimmers.

The panels and speakers raved about bitcoin and its future. MicroStrategy Inc. co-founder Michael Saylor, who leveraged his business-software company and put more than 100,000 bitcoins, worth more than $6 billion at the peak, on its balance sheet, said: “I am more bullish than ever on bitcoin.” ARK Investment CEO Cathie Wood said bitcoin would rise to more than US$1 million. PayPal Holdings Inc. co-founder Peter Thiel suggested bitcoiners should make an “enemies list” of people opposed to the cryptocurrency.

At that conference and others, “you could see this certain amount of euphoria and sense of invincibility,” said Dan Gunsberg, who started investing in bitcoin in 2015 and today is the chief executive at crypto-based Hxro Network. Mr. Gunsberg said he knew the ebullience was a sign of trouble: “Nothing that moves that fast, that parabolic, can stay high. Gravity pulls it back to earth.”

The crash

As fear of inflation rages, traders and investors are dumping assets in their portfolio that they deem risky. Shares of unprofitable companies have dropped swiftly, with many newly public technology companies losing more than half their value in the first half of the year. Also high on the sell list: crypto.

So far this year, bitcoin has lost more than half of its value and currently trades at its lowest level since late 2020. Ethereum, another popular cryptocurrency, has fallen around 68% so far this year.

“There was absolutely a lot of hubris across a lot of asset classes. That led to a lot of greed and unsustainable business models and a lot of leverage in crypto. That’s collapsing now,” said Alex Thorn, head of firmwide research at Galaxy Digital Holdings Ltd, a crypto-focused financial-services firm. “A large number of crypto funds will not survive this.”

Many don’t appreciate the degree to which the sector’s growth has been aided by a long-running bull market in stocks and the market-juicing policies of the world’s central banks, said Joel Kruger, a strategist at asset exchange LMAX Digital. It was the very system crypto sought to replace.

“The irony of it all is the easy-money conditions since the 2008 crisis have lent themselves to the greatest period of risk-taking we’ve ever seen,” Mr. Kruger said. “That benefited cryptocurrencies.”

The fallout

In retrospect, Mr. Jones’s “great speculation” remark may end up being the most prescient comment on bitcoin. The braggadocio that marked so much of the crypto world is fading as those easy-money policies have been reversed and the bull market in stocks has disappeared.

The carnage has spread from the cryptocurrencies themselves to companies that provide services in the market. For exchanges, trading activity drives the majority of their business, and with the selloff, revenues have fallen. Coinbase reported a US$429.7 million first-quarter loss in May and said its users were fleeing the platform, even as its executives sold stock and pocketed profits. In June, for the first time since its founding in 2012, it laid off staff—nearly one-fifth of its workforce. Its stock now trades around US$51, compared with its high of US$429.54 on its first day of trading on April 14, 2021. Gemini, BlockFi, and big-spending Crypto.com have also let staffers go.

In early May, persistent downward pressure in the crypto market broke something big: the stablecoin terraUSD, a cryptocurrency meant to hold a steady US$1 value, collapsed due to what was essentially a run on the bank, taking along with it its sister coin, Luna. Almost overnight, US$40 billion worth of the two cryptocurrencies were gone. That collapse has had downstream effects. Earlier in June, a large crypto-lending service called Celsius Network LLC, which had about US$12 billion in user assets, froze withdrawals. The money is currently still locked up and the company has hired a law firm to try to work through its obligations and debts. Another lender, Babel Finance, on Friday suspended withdrawals and redemptions.

Cryptocurrency-focused hedge fund Three Arrows Capital Ltd. has been considering strategic options, The Wall Street Journal reported Friday, including asset sales or a rescue by another firm, after it suffered major losses.

Despite the losses, some investors remain optimistic. Marshall Johnson Jr., a 54-year-old education-television producer in Maryland, started buying bitcoin in 2021, when it was around US$38,000. His plan at the time was to slowly put in enough money to own one full bitcoin. He still believes in bitcoin’s future, and hasn’t changed his plan despite the selloff and despite the fact that on paper he has lost money. In fact, given the drop in price, he figures he’ll reach his goal sooner.

“I’m closer than I was a year ago,” he said, laughing.

C.J. Wilson first heard of bitcoin in 2012. At the time, he was a Major League Baseball pitcher who lived in California and had spent his downtime buying and selling silver bars and gold coins. He said he viewed the digital currency with skepticism because he wasn’t sure how currency could be created on a computer. In 2019, after he retired from MLB, however, he read the white paper by Satoshi Nakamoto on bitcoin and was intrigued.

A self-described insomniac, Mr. Wilson said he began trading bitcoin in the middle of the night, and soon started dabbling in other cryptocurrencies. “Sometimes you just look at them and think that’s a cool name,” he said. He attended crypto conferences all over the world, from San Francisco to London to Las Vegas.

Mr. Wilson eventually refocused his attention on bitcoin. This past year, though, he said he started noticing signs of froth. When Crypto.com sponsored the Lakers’ arena, he started wondering, “Where are they getting all this money from?” He said he received invitations to yacht parties from people who had made it big in crypto. He noticed Coinbase’s CEO, Brian Armstrong, bought a home in California for US$133 million. At the bitcoin conference in Miami this spring, he attended a glitzy party hosted by Gemini at a mansion.

“To me, it makes you realise that was probably the top of the market,” he said. Mr. Wilson said he still believes in bitcoin, but this spring he started trading bitcoin more than simply holding it.

The current flushing-out of the crypto world strikes some investors as similar to the late-1990s and internet companies. On the one hand, investors were correct during that bubble: The internet was the future. But that didn’t stop many of them from losing boatloads of money as hundreds of internet companies failed.

“Long-term, we’re huge believers in crypto,” said Shaun Maguire, a partner at Sequoia Capital who invests in crypto. “But short-term, watch out.”

Before the pandemic, Kelly Miller, 35, was a professional musician in San Francisco. He watched his income go to zero as the world shut down, and started investing in stocks through Robinhood Markets Inc. In January 2021 he decided to try buying some crypto coins, and purchased some dogecoin. He watched his small purchase soar in value before swiftly falling back. Despite the roller coaster, Mr. Kelly, who now lives in Istanbul, said he was hooked. Over the past year and a half, he’s bought bitcoin, Ethereum and solana, among others, with the most of his money in solana, he said. The latest downturn, which has hurt his portfolio, drove home to him the need for changes in the crypto world.

“This space needs to be regulated, it needs to be safe for consumers,” he said. He said he believes there’s a lot of value in the underlying technology, and in NFTs in particular, but he said he’s worried selloffs like this current crypto winter will erode trust among investors.

Dan Held got into bitcoin in 2012, attracted to the idea of a new money system at a time when most people hadn’t even heard of it. He moved to San Francisco from Texas, started going to bitcoin meetups and immersed himself in the culture.

Mr. Held has been proselytizing bitcoin for years, and has a sizable Twitter following, but he was surprised earlier this year when he started getting recognized, both on the street and in an elevator in a Texas hotel. It was a sign to him of just how widespread the phenomenon had gotten. “I get recognized on the street? Walking around Austin?” he said. “That was really surprising.”

His fervor is driven by the idea that bitcoin solves fundamental problems with the existing system. None of the crashes—not even the current one—has shaken that belief.

“My thesis is the same as in 2012,” he said. “There’s so many other people like me, I don’t see this being the end of bitcoin.”

 

Reprinted by permission of The Wall Street Journal, Copyright 2021 Dow Jones & Company. Inc. All Rights Reserved Worldwide. Original date of publication: June 18, 2022



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Booming demand for wellness tourism shows no slowing, with travel related to health and well-being projected to have reached $1 trillion last year and to hit $1.3 trillion by 2025, according to the Global Wellness Institute, a nonprofit based in Miami.

Curated wellness travel programs are especially sought-after, specifically holistic treatments focused on longevity. Affluent travellers not only are making time to hit the gym while gallivanting across the globe, they’re also seeking destinations that specifically cater to their wellness goals, including treatments aimed at living longer.

“I believe Covid did put a spotlight on self-care and well-being,” says Penny Kriel, corporate director of spa and wellness at Salamander Collection, a group of luxury properties in places like Washington, D.C., and Charleston, South Carolina. But Kriel says today’s spas are more holistic, encouraging folks to understand the wellness concept and incorporate it into their lifestyle more frequently.

“With the evolution of treatment products and technology, spas have been able to enhance their offerings and appeal to more travellers,” Kriel says.

While some growth is connected to the variety of treatments available, results and the digital world are also contributing to the wellness boom.

“The efficacy and benefits of these treatments continue to drive bookings and interest, especially with the support of social media, influencers, and celebrity endorsements,” Kriel says.

While genetics, environmental factors, and lifestyle choices such as regular exercise, a diet free of processed foods, sufficient sleep, and human connection play essential roles in living well and longer, experts believe in holistic therapies to help manage stress, boost immunity, and ultimately influence length and quality of life.

Anti Ageing and Beyond

“For years, people have been coming to spas, booking treatments, and gaining advice on how to turn the clock back with anti ageing and corrective skin treatments,” Kriel says. However, today’s treatments are far more innovative.

On Marinella Beach in Porto Rotondo, on the Italian island of Sardinia, guests at the five-star Abi d’Oru Hotel & Spa can experience the resort’s one-of-a-kind “longevity treatment,” a unique antiaging facial using one of the island’s native grapes: Cannonau. The world’s first declared “Blue Zone”—one of five designated areas where people live longer than average, some into their 100s—Sardinia produces this robust red wine varietal, the most widely planted on the island.

Known as Garnacha in Spain and Grenache in France, Cannonau supposedly contains two to three times more antioxidants than other red-wine grapes. By incorporating Cannonau, Abi Spa says its unique 50-minute longevity session increases collagen production for firmer, younger-looking skin.

Maintaining a youthful appearance is just one facet of longevity treatments, which range from stress-reduction sessions like massage to nutritional support and sleep programs, Kriel says. Some retreats also offer medical services such as IV infusions and joint injections.

Keeping with the trend, Kriel is expanding Salamander Collection’s existing spa services, such as detox wraps and lymphatic drainage, to include dedicated “Wellness Rooms,” new vegan and vegetarian menu items, and well-being workshops. “Sleep, nutrition, and mindfulness will be a big focus for integration in 2024,” she says.

Data-Driven Wellness

Skyler Stillings, an exercise physiologist at Sensei Lanai, a Four Seasons Resort—an adults-only wellness centre in Lanai, Hawaii—says guests were drawn to the social aspect when the spa opened in November 2021.

“We saw a huge need for human connection,” she recalls. But over the past few years, what’s paramount has shifted. “Longevity is trending much more right now.”

Human connection is a central draw for guests at Sensei Lanai, an adults-only and wellness-focused Four Seasons Resort in Hawaii.
Sensei Lanai, A Four Seasons Resort

Billionaire co-founder of tech company Oracle Larry Ellison and physician and scientist Dr. David Angus co-founded Sensei. After the death of a mutual close friend, the duo teamed up to create longevity-based wellness retreats to nurture preventative care and a healthy lifestyle. In addition to the Lanai location, the brand established Sensei Porcupine Creek in Greater Palm Springs, California, in November 2022.

Sensei has a data-driven approach. The team performs a series of assessments to obtain a clearer picture of a guest’s health, making wellness recommendations based on the findings. While Sensei analyses that data to curate a personalised plan, Stillings says it’s up to the guests which path they choose.

Sensei’s core three-day retreat is a “Guided Wellness Experience.” For spa treatments, each guest checks into their own “Spa Hale,” a private 1,000-square-foot bungalow furnished with an infrared sauna, a steam shower, a soaking tub, and plunge pools. The latest therapies include Sarga Bodywalking—a barefoot myofascial release massage, and “Four Hands in Harmony,” a massage with two therapists working in tandem. Sensei Guides provide take-home plans so guests can continue their wellness journeys after the spa.

Sensei Lanai, an adults-only and wellness-focused Four Seasons Resort in Hawaii.
Sensei Lanai, A Four Seasons Resort

Sanctuaries for Longevity

Headquartered in Switzerland with hotels and on-site spas across the globe, Aman Resorts features an integrative approach, combining traditional remedies with modern medicine’s advanced technologies. Tucked behind the doors of the storied Crown Building in Midtown Manhattan, Banya Spa House at Aman New York—the brand’s flagship spa in the Western Hemisphere—is a 25,000-square-foot, three-floor urban oasis.

Yuki Kiyono, global head of health and wellness development at Aman, says the centre provides access to holistic and cutting-edge treatments benefiting physical, mental, emotional, spiritual, and social well-being. Aman’s customisable “Immersion Programs” consist of a three- or five-day immersion. “The programs encompass treatments and experiences that touch every significant aspect to create a path for longevity, from meditation and mindfulness to nutrition and movement,” Kiyono explains.

Banya Spa House at Aman New York.
Robert Rieger

The spa’s “Tei-An Wellness Solution” features 90- to 150-minute sessions using massage, cryotherapy, and Vitamin IV infusions. Acupuncture is also on offer.

“With its rich history of Chinese Medicine, modern research, and the introduction of sophisticated electro-acupuncture medicine, acupuncture has been proven to assist with problems and increase performance,” Kiyono says.

Resetting the Mind and Body

Beyond longevity, “healthspan”—the number of years a person can live in good health free of chronic disease—is the cornerstone of Mountain Trek Health Reset Retreat’s program in British Columbia, Canada.

Kirk Shave, president and program director, and his team employ a holistic approach, using lifestyles in long-living Blue Zones as a point of reference.

“We improve our daily lifestyle habits, so we live vitally as long as we’re meant to live,” Shave says of the retreat. He built the program from an anthropological stance, referencing humans as farmers, hunters, and gatherers based on their eating and sleeping patterns. Food includes vegetable-centric meals sans alcohol, sugar, bread, or dairy.

Guests wake at dawn each day and have access to sunrise yoga, several hours of “flow” or slow hiking, spa treatments, forest bathing, calming crystal singing-bowl and sound therapy sessions, and classes on stress reduction—one of Mountain Trek’s primary goals. The program motivates people to spend much of their time in nature because it’s been proven to reduce cortisol, the stress hormone that can lead to inflammation and disease when elevated for extended periods.

While most guests aren’t aware of how immersive Mountain Trek’s program is when they arrive, they leave the resort revitalized after the structured, one-week program. Set in the Kootenays overlooking its eponymous river, the resort and adventure promise what Shave calls a “visceral experience of transformation.”

“They’re interested in coming to be in nature,” Shave says of the guests. “They hit a wall in their life and slipped backwards, so they know they need a reset.”

Banya Spa House at Aman New York provides access to holistic and cutting-edge treatments benefiting physical, mental, emotional, spiritual, and social well-being.
Robert Rieger

This article first appeared in the Winter 2024 issue of Mansion Global Experience Luxury.

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