Beside the sparkling bottles of summertime rosé wine, a Coin Cloud cryptocurrency vending machine is part of the shopping experience at Robért Fresh Market on Allen Toussaint Boulevard in New Orleans.
The giant German zeppelin Hindenburg was destroyed by a hydrogen fire that broke out in the stern of the airship as it was completing its first North Atlantic trip of the season at the Naval Air Station at Lakehurst, N.J., on May 6, 1937.
An advertisement for bitcoin, a popular cryptocurrency, is displayed on a building in Hong Kong on Nov. 18, 2021. Bitcoin and other cryptocurrencies were collapsing in price on Monday, June 13, 2022, after the major crypto lender Celsius halted all withdrawals, citing “extreme market conditions.” It is the second collapse of a part of the crypto world in the past two months.
Beside the sparkling bottles of summertime rosé wine, a Coin Cloud cryptocurrency vending machine is part of the shopping experience at Robért Fresh Market on Allen Toussaint Boulevard in New Orleans.
A Coin Cloud cryptocurrency vending machine beckons at the Robért Fresh Market on Allen Toussaint Boulevard in New Orleans.
A Coin Cloud cryptocurrency vending machine beckons at the Robért Fresh Market on Allen Toussaint Boulevard in New Orleans.
Former online poker pro Chris McAlary founded Coin Cloud, which has 5,900 ATM-style cryptocurrency machines across the United States and in Brazil.
Beside the sparkling bottles of summertime rosé wine, a Coin Cloud cryptocurrency vending machine is part of the shopping experience at Robért Fresh Market on Allen Toussaint Boulevard in New Orleans.
This is a sad story about a newspaper reporter losing money in the recent cryptocurrency meltdown. Sure, we’re talking about only $36.12, but it’s still sad. Here’s how it went down.
This reporter walked into the Robért Fresh Market on Allen Toussaint Boulevard in New Orleans last weekend to pick up a slab of St. Louis-cut pork ribs, a gallon of skim milk and whatnot. He was immediately beguiled by this shiny blue vending machine at the front of the store, beside the lavish display of summertime rosé wine. The machine was meant as a covenient way for shoppers to buy and sell bitcoin and dozens of other cryptocurrencies.
A Coin Cloud cryptocurrency vending machine beckons at the Robért Fresh Market on Allen Toussaint Boulevard in New Orleans.
Cryptocurrency in the grocery store? Really?
Curiosity took hold. For years, this reporter had been intrigued by cryptocurrency as a concept. It’s an invented, 21st-century form of money, anchored in unknowably complicated computer code, instead of in old-fashioned gold or silver or the full faith and credit of a government. It swears allegiance to no particular government, flies no flag, knows no borders and does an end run around the stodgy, ordinary banking system.
To our reporter, cryptocurrency was like digital pirate’s booty. Mysterious! Adventuresome! Maybe a little wicked. To our reporter, who is almost 66 years old, crypto was … youthful!
Plus, according to popular wisdom, some people had made millions of dollars investing in it. Our guy felt left out.
Our reporter withdrew five crisp 20s from the ordinary ATM that stood beside the seductive bitcoin vending machine, and fed them into its eager slot. He downloaded the app that is affiliated with the machine, so he could receive his investment of 0.003 bitcoins, and waited for the digital deal to be done. As he bided his time, a passing grocery store employee congratulated him for his daring. That was at roughly 6:45 on Sunday night.
By noon Monday, our reporter’s investment had crashed faster than the Hindenburg. The Times-Picayune headline the next day read, “Market tumbles on economic fears: Wall Street falls into bear territory as stocks bonds and crypto dive.”
The giant German zeppelin Hindenburg was destroyed by a hydrogen fire that broke out in the stern of the airship as it was completing its first North Atlantic trip of the season at the Naval Air Station at Lakehurst, N.J., on May 6, 1937.
Overnight, the reporter’s 100 bucks had shriveled to $67.60. The merciless machine had taken an almost 10% cut off the top, and the rampaging bear market had eaten up another 25% or thereabouts.
It’s important to point out that the folks at Robert’s had nothing to do with the reporter’s troubles. Vice president and general manager Marc Robert III explained that the grocery doesn’t share in any profits from crypto trading; the crypto vending machine owner, Coin Cloud, only rents the two-foot square of floor it occupies.
A Coin Cloud cryptocurrency vending machine beckons at the Robért Fresh Market on Allen Toussaint Boulevard in New Orleans.
Robert said the machine at the Allen Toussaint Boulevard location is the grocery chain’s first. “We are using it as a test, and if successful we will roll out to all stores,” he said. It’s been there only six months or so, he said, and so far it hasn’t seemed to be terribly popular, but it’s “very user friendly and does not require staff assistance,” so it’s no trouble.
Currently, you can’t buy your Brussels sprouts and LaCroix with crypto at Robert’s. But who knows what the future holds? “We are a company that is always looking for ways to implement new technologies to make the customer experience easier for our shoppers,” Robert said, “and provide our shoppers with more options for checking out.”
The reporter happened to dip his toe in crypto investing at a “very ugly” moment, said John Gin, a Metairie-based financial adviser who wrote a regular column for The Times-Picayune until 2018.
“Anything that has a big run-up in a short time gets people’s attention,” Gin said. That’s what happened during the tech bubble in the late 1990s, which ended disastrously for many investors. The frantic growth of dot-com companies back then “worked until it didn’t,” he said. And that could be what’s happening with crypto.
Crypto is an alternative to traditional investment, Gin said, and that’s attractive to some people, especially young people, and especially in an era of social unrest. But because it’s not rigorously regulated, has been the target of high-tech thieves and “isn’t backed by anything,” Gin advises clients not to put too many of eggs in that basket.
“Our view is that crypto is very speculative,” Gin said. We suggest people “build a base of safe stuff,” then toy with crypto if they’re so moved. That way, “if someone wants to dabble for the experience, they can do that without tearing down the house.”
In short, crypto is a gamble. So it should come as no surprise that the dude who founded the Coin Cloud company is a former professional online poker player who lives Las Vegas. No lie.
Former online poker pro Chris McAlary founded Coin Cloud, which has 5,900 ATM-style cryptocurrency machines across the United States and in Brazil.
Back when Chris McAlary was studying economics in college, he discovered he was great at computer card games. He said he made a living at online poker until the U.S. Justice Department cracked down in 2011 and seized the bank accounts of some gambling sites.
“Immediately my winnings were tied up,” he said.
It might have been that experience that turned him toward crypto. The good thing about crypto is that it’s not tied to traditional banks, he said: “I was drawn to self-custody,”
The downside – as anyone who’s set up a cryptocurrency account can tell you – is that it’s a tedious process that involves proving your identity to a crypto source, setting up a digital wallet to store your intangible currency and long lag times during purchases. McAlary concieved a simpler alternative.
He considers his 5,900 Coin Cloud machines, which are scattered across 47 states, to be the “easiest way to buy cryptocurrency.” You don’t have to go through all the regular rigmarole; you just feed in your cash and watch dollar signs pop up on your phone. That’s pretty much it.
Beside the sparkling bottles of summertime rosé wine, a Coin Cloud cryptocurrency vending machine is part of the shopping experience at Robért Fresh Market on Allen Toussaint Boulevard in New Orleans.
Until you’ve bought $1,000 in crypto, anyway. At that threshold, any of the machines in the Coin Cloud network will ask you to show your driver’s license to the electronic eye at the top of the kiosk, and to pose for a selfie, to prove your identity.
“The ID stays on file with us securely,” said Coin Cloud representative Steve Stratz. “It’s only ever released if we are subpoenaed by law enforcement.”
Cynics might say Coin Cloud machines are perfect for money laundering. Let’s say you’re a mugger or an oxy dealer, or just want to hide some cash income from Uncle Sam. You could creep over the grocery store and convert your ill-gotten gains into squeaky clean crypto, right?
An advertisement for bitcoin, a popular cryptocurrency, is displayed on a building in Hong Kong on Nov. 18, 2021. Bitcoin and other cryptocurrencies were collapsing in price on Monday, June 13, 2022, after the major crypto lender Celsius halted all withdrawals, citing “extreme market conditions.” It is the second collapse of a part of the crypto world in the past two months.
McAlary says those cynics don’t have the whole picture. First of all, he said, the Treasury Department could compare the selfie to its database of bad guys. Plus, he said, the ever-changing stream of digital code that comprises cryptocurrency – the blockchain – records all transactions, which are traceable if you should get in trouble with the law.
Coin Cloud machines charge customers 9.9 percent on crypto purchases and 5.9 percent on sales. McAlary pays places such as Robert’s about $200 per month to park his kiosks. Besides the one at Robert’s on Allen Toussaint Boulevard, there are 13 machines around the New Orleans area. McAlary, who produced his first crypto ATM in 2014, says he’s not a fabulously rich tech tycoon. But he does tool around Sin City in an Aston Martin.
“Yes, there’s a lot of volatility,” McAlary said of the crypto market. But, “I’m still buying more and more, every single day.”
As of Thursday at 4:15 p.m., our reporter’s $100 crypto nest egg had shrunken to $64.41. As of Friday at 12:30 p.m., the value was $63.88.
Question: If our reporter were to add his crypto “research” costs to his Times-Picayune expense account, could he, in good conscience, claim the entire $100, or just the $36.12 that he’s lost so far?
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Email Doug MacCash at dmaccash@theadvocate.com. Follow him on Instagram at dougmaccash, on Twitter at Doug MacCash and on Facebook at Douglas James MacCash.
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