Today, Charlie Shrem’s life could be described as balanced. A married man who plans to have children soon, Shrem spends his time reorganizing his portfolio to reduce risk and plan for the future. This tranquil and peaceful life may come as a surprise to those who previously followed the crypto-wizard’s endeavors. Characterized extreme highs and exorbitant lows, Shrem’s rollercoaster life has been more volatile than the price of bitcoin.
Childhood
Born in November of 1989, Charlie Shrem was raised in a Sephardic Syrian Jewish community in Brooklyn, N.Y.. The son of a jeweler and a stay at home mom, Shrem became acclimated to handling money and understanding the value of a dollar at a young age. Shrem recalled from his childhood that “[My parents] didn’t do anything to excess. They never just said, here’s a bunch of money do whatever you want… I had to be accountable for it… If I spent [my allowance] they wouldn’t give me more.” This austerity, combined with the rapidly growing price of his computer hobby, forced him to find a solution.
Shrem displayed a penchant for entrepreneurship at a young age. Utilizing his rapidly developing technological skills, he established himself as a local tech guru and began charging for his services. “People had computer issues at home … they didn’t know how to fix. And I realized that I can provide a good service just being someone that they [could] call on demand and I charged … 20 bucks an hour.” Shrem had so much success in his new business that he purchased his own car as a high school junior with absolutely no help from his parents.
Shrem’s initial financial success proved to be fleeting. Just one year later upon turning 18 years old, he received a credit card with a $6,000 spending limit. Thrilled with his new available funds, Shrem blew through them in a year, with a number of purchases that he characterized as “Just stupid things. Stupid things.” By the time he graduated, Shrem had racked up an astonishing $10,000 in debt. Although his father helped him restructure his debt, it still took him approximately two years to get himself back on track financially. This would prove to be the first of several boom and bust cycles that were emblematic of his previous turbulent lifestyle.
College Years
While a student at Brooklyn College, Shrem began working towards establishing his financial independence. In an effort to climb his way out of five figures of debt, Shrem diversified his portfolio and sought new ways to generate revenue. One of his first endeavors was the creation of the website dailycheckout.com, where he sold refurbished and used electronic equipment, pocketing $600 a week.
Shrem’s entrepreneurship continued throughout his years at Brooklyn College. As a college senior in 2011, Shrem began investing in Bitcoin while it was still in its infancy, before he lost his digital assets after the failure of his storage device. Owing to this event, Shrem and fellow Bitcoin enthusiast Gareth Nelson partnered to launch BitInstant, an ecommerce website designed to “help people convert dollars into Bitcoin.” BitInstant became an immediate success; at one point in time, BitInstant was responsible for approximately 30% of all Bitcoin transactions. Through this new company, Shrem acquired a significant amount of wealth, claiming that at 22 years old he half a million dollars sitting in his checking account. BitInstant marked a considerable upswing in Shrem’s life.
Charlie Shrem while running BitInstant, Image from CoinTelegraph
In addition to his entrepreneurial endeavors, Shrem was a founding member of the Bitcoin Foundation, alongside other notable cryptocurrency advocates such as Roger Ver. The Bitcoin Foundation is a nonprofit corporation dedicated to the “[standardization], [protection], and [promotion]… of bitcoin cryptographic money for the benefit of users worldwide.” In particular, Shrem was responsible for leading the partnerships and mergers of Fundación Bitcoin Argentina, Bitcoin Embassy of Canada, and Bitcoin Association of Australia, all in an effort to spread the gospel of bitcoin. Modeled on the Linux Foundation, the Bitcoin Foundation carries out its mission through grants from for-profit companies that utilize bitcoin technology.
Fall From Grace
Before long, Shrem and BitInstant began attracting unwanted attention. Shrem was notified by his lawyers that a BitInstant user was buying and flipping bitcoins on Silk Road, the illegal online black market. On the advice of his lawyers, Shrem and his associates shut down BitInstant on July 3, 2013. Because nobody lost any money, Shrem assumed that this was the end of the case, and moved on with other business ventures.
Charlie Shrem a month before Arrest, Image by Vocativ
Eight months later, Shrem’s quality of life plummeted. After returning to the United States from a convention in Amsterdam, Shrem landed at JFK Airport, only to find agents from the Drug Enforcement Administration and the IRS waiting for his arrival. Authorities held Shrem directly responsible for Robert Faiella’s scheme, and the following morning, Shrem learned the extent of his charges: one count of conspiracy to commit money laundering, one count of failure to file a suspicious activity report, and one count of operating an unlicensed money transmitter.
All together, one of the first crypto millionaires was looking at 25 years in jail; ultimately, he ended up serving one year in prison, and was released in June 2016.
Release From Prison
Charlie Shrem left jail as a changed man. Upon his release, Shrem worked on reintegrating himself into society. Initially a struggle, Shrem did not return immediately return to his previous lifestyle. Shrem recalls that for he “…didn’t actually turn on a computer for two months… I didn’t get a cell phone and I didn’t turn on my iPhone… I was weird… I wasn’t ready.” Instead, Shrem took a low-key job in rural Pennsylvania, washing dishes for eight dollars an hour. Recalling this period of his life, Shrem said that he needed to be accountable, and spoke of how much he valued this time.
Conclusion
Currently residing in Sarasota, Florida, Charlie Shrem’s serene life is far removed from the chaos that defined his life in Brooklyn. Imbued with a new perspective on life, the Shrem of 2018 is thoughtful and grounded. Speaking of his wealth, the person who once had half a million in a checking account said “…I got to be smart. I’m getting married, we’ll have children eventually, I can’t, you know, I can’t speculate with my rent.”
Charlie Shrem Today, Image from CNBC
Today, Charlie Shrem occupies himself with a number of new ventures. In October of 2017, Shrem founded CryptoIQ in Sarasota, Florida. A comprehensive stop for financial sources in the crypto industry, CryptoIQ and Shrem’s mission is “… to empower people by providing access to the world of Crypto.” Shrem continues to advocate for wider adoption of bitcoin.
Wise and mature beyond his years, Charlie Shrem is the sum of admittedly disparate parts. As a part of the first generation of individuals who adopted bitcoin, Shrem’s ingenuity and foresight paved the way for future users. Despite his previous mistake, Shrem’s continued presence in the crypto-community will continue to add credibility to the community and foster growth.
References
- https://www.wnycstudios.org/story/a-bitcoin-mogul-goes-broke-death-sex-money/
- https://www.wnycstudios.org/story/a-bitcoin-mogul-goes-broke-death-sex-money/
- https://www.investopedia.com/tech/who-charlie-shrem/
- https://www.cnbc.com/2017/12/08/what-bitcoin-millionaire-charlie-shrem-learned-from-going-to-prison.html
- https://en.wikipedia.org/wiki/Bitcoin_Foundation#cite_note-1
- http://planningtampabay.org/net/frmPeoBio.aspx?id=36668
- https://www.theverge.com/2014/2/4/5374172/the-coin-prince-charlie-shrem-bitinstant-bitcoin-money-laundering-scandal
- https://www.washingtonpost.com/news/the-switch/wp/2014/01/27/feds-charge-bitcoin-start-up-founder-with-money-laundering/?utm_term=.2ae53fe7a7e5
- https://www.wnycstudios.org/story/a-bitcoin-mogul-goes-broke-death-sex-money/
- https://www.cnbc.com/2017/12/08/what-bitcoin-millionaire-charlie-shrem-learned-from-going-to-prison.html
- https://cryptoiq.co/about-us-bitcoin-investing/
