As reported in The New York Times, there’s a new and growing local trend. Cryptocurrency firms, not usually known for needing a lot of group office time, are renting up space in Manhattan business areas.
Coinbase is moving to Manhattan, and bringing friends
We’d expect Coinbase to get the biggest and flashiest office possible. After all, having the HQ of a company in a pioneering field placed around peers with established clout does wonders.
But Coinbase’s office in Hudson Yards covers “only” 30,000 square feet. A large space for both regular and crypto businesses, but, and this is surprising, not the biggest in the cryptocurrency industry.
Chainalysis, a cryptocurrency data-analysis firm, rented out some 77,000 square feet for its Union Square slot. The firm’s CEO commented how Union Square has quickly come to brim with crypto firms.
The local publication amNY tells us:
According to New York City’s Economic Development Corporation, the Big Apple’s tech ecosystem accounts for more than 291,000 jobs and more than $124.7 billion in economic output. The city’s famed tech sector continues to grow each year, and Union Square is cementing its reputation as that community’s hub.
Union Square has already become home to some of the technology industry’s brightest stars, including Dropbox, Hulu, Mashable, eBay, Buzzfeed and more.
Why choose New York in particular?
Crypto companies have had three primary destinations so far: Silicon Valley, Miami with its crypto-friendly mayor, and New York. New York, too, has a crypto-friendly mayor. But relocations there on the part of firms have to do with more than that.
Wanting to have a large presence (and of course a large office, usually the main one) in the world’s financial hub demonstrates that these businesses mean business.
In other words, they aren’t cutting back. They aren’t scaling down their aspirations. They aren’t hibernating during this crypto winter. Nope – they’re doing the opposite.
Based on comments from brokerage firm Adams & Company, it seems that cryptocurrency companies are far more concerned about their own performance than that of the crypto markets in general. The firm said that crypto companies are mostly taking out three-year leases on their office spaces. And three years is a century in cryptocurrency time! (Remember, three years ago today, bitcoin’s price was $8,208 and is up 270% since.)
Others are, it seems, betting big on themselves. Solana, the issuer of the top “Ethereum killer”, took out a ten-year lease at 141 East Houston. (Ten years ago, bitcoin’s price was about $120.) Solana also plans to expand to 190 Bowery, where it would host an office for its EmpireDAO project. Quickly taking up the space that was not-too-long-ago reserved for the collapsed TerraUSD shows that full-bore competitiveness is alive and well in the crypto sphere.
In my mind, this is a pretty clear message. Companies don’t sign multi-year leases for extremely prestigious and expensive real estate on a whim. Coinbase, Solana, Chainalysis and the others are putting their money where their mouth is. Their message?
“Crypto may go up, crypto may go down, but crypto isn’t going away.”
It’s like we said a couple of weeks back – crypto has become “too big to fail.” That’s why crypto businesses are actively seeking merger and acquisition targets. It just doesn’t look like the overall crypto adoption and innovation movement is slowing down at all.
And this makes sense. After all, Standard & Poor’s doesn’t go out of business during bear markets. Healthy businesses usually survive bad economic times. How many bear markets have corporations like IBM or Wells Fargo endured?
Sorry, never-bitcoiners and crypto skeptics – it doesn’t look like the entire blockchain enterprise is going to disappear. In fact, it’s actually changing the businesses it interacts with…
Cryptocurrency adoption in real estate
For the time being, all of the cryptocurrency companies are paying for their leases in U.S. dollars. But there have been some developments on that front as well. Okada & Company is trying to make the most of NFTs, using them as a kind of advertisement for real estate offers they put up. The firm’s CEO said that houses have already been sold this way, and that his offer to sell an office space for $29 million or 15,505 Ether is a pioneering effort.
Okada & Company is also trying to use NFTs to invite real estate brokers into a private dining club. And with the drive to normalize cryptocurrencies as an option when accepting monthly salaries, the renters might not need to convert from crypto much longer. Phil Ryan, director of U.S. office research for the real estate firm JLL, said that crypto firms now occupy 835,000 square feet compared to 0 in 2015.
Considering crypto already had some really interesting projects in 2015, it’s a showcase of just how quickly things are moving. Crypto companies are looking to redesign pretty much everything, and the appearance and utility of their office spaces are just part of the trend. Yet it seems they are all equally keen on making themselves at home in the home of global finance, Manhattan.
And it’s about time!