You may have seen recent headlines that many cryptocurrencies crashed in value this summer. Is that a red flag for this so-called “revolution?”
SCRANTON, Pa. — The cities and towns of northeastern and central Pennsylvania were built on mining, they called it “black gold.”
Our area’s anthracite powered the world and is burned into our past.
Now, there’s a new type of miner all over our area; burning power and chipping away at what some believe is our future.
“Everybody’s like, ‘Oh, we’re afraid of it, we’re afraid of it.’ But, unfortunately, it’s coming a lot faster than you think,” said Stacey Toy of NFT Drop LLC.
Stacey Toy, a Wayne County native, is talking about cryptocurrency.
Bitcoin is the one you may have heard of, but there are thousands of them.
The currencies, or coins, aren’t backed by gold, printed by a government, or held by a bank.
They’re passed from person to person all online every transaction ends up on a public digital ledger that anyone can see.
The miners in this world work by verifying that ledger over and over again to make sure it’s accurate.
A computer does all the work; entrepreneurs like Toy and her partner Gil Laueiro make money from it.
A map shows miners in the Scranton area of just one type of cryptocurrency, called Helium, this one is doing its work in a warehouse along N. Washington Avenue.
Laureiro says crypto-mining entrepreneurs are attracted to NEPA.
“They look for places that have cheap real estate and low electric cost. If you compare Manhattan or Long Island costs to Pennsylvania, hands down Pennsylvania is so much cheaper,” he said.
Mining isn’t the only way entrepreneurs are trying to cash in on the crypto craze, there’s also money to be made in investing; or in Eric Grill’s case, helping others invest their dollars in crypto.
Grill owns ChainBytes, a company based outside Allentown that manufactures and operates Bitcoin ATMs.
“They see the money that’s being printed, they see their wealth being stolen from them, so they’re looking for alternatives. Traditionally it would be gold, things like that. Now, cryptocurrencies are certainly going to be a place to store value. What we’re looking to do is build that road, a bridge, between the old legacy system to this new financial system that we’ll all be using in a few years,” Grill said.
You may have noticed the devices in your local gas station right alongside traditional ATMs.
You can buy crypto on any computer but Grill says some investors prefer the familiarity of an ATM.
He showed us how his machines work.
Stacy: “When you said do you have a wallet I thought you meant a physical wallet, I went to go get my wallet.”
Eric: “I’m sorry! Do you have a phone?”
Stacy: “I have a phone! See, this is why we’re doing this story!”
In under a minute we turned a $20 into.00050471 Bitcoin.
“It’s sent on the blockchain, everybody knows about it, now the miners are validating it,” Grill said.
He makes money by taking 17 percent of the cash a customer puts into the machine.
“What you have there is the equivalent of having dollars in your pocket, except you can send it anywhere in the world without asking permission,” Grill said.
He believes cryptocurrencies could replace our current financial system. From his office in Lehigh County, he’s advised the Venezuelan government as it made Bitcoin legal tender and he’s working with a team of lawmakers in Mexico hoping to do the same there.
“Our system is very antiquated, the way we wire money, the way our financial system works, is, has not been updated in a while,” Grill said.
It’s not just entrepreneurs looking to cash in on crypto, there are some big local companies investing and mining bitcoin and other currencies.
We’ll profile those companies next time.
All of these efforts come with risks and consequences.
We’ll get into that, too.
Stay tuned all month long as Action 16 Investigates: Crypto.
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