BYU student John Graff sat down in a Seattle Starbucks, tapping his foot anxiously. Exhausted from the 3.5-hour drive, he ordered a hot chocolate, sipping on it every so often with anticipation. After a few minutes, the front door swung open and a middle-aged man took the seat across from him, holding a single envelope in his hand.
Few words were exchanged before Graff accepted the envelope and stuck it in his pocket. He hopped back in his car and began his long trek back to Oregon — only this time, $9,000 richer.
Graff, a junior, began investing in bitcoin back in 2016, just seven years after it first launched in 2009.
“I was able to buy in before I was 18 because they didn’t care who was buying, really,” Graff said. “There were less regulations back then; people didn’t care because it was just this weird internet thing.”
At the time, bitcoin was worth $434.46 per coin. It’s now worth roughly $44,000 per coin.
Graff first discovered bitcoin through a friend that mined the cryptocurrency in his basement. Bitcoin mining is the process of creating new bitcoins by solving extremely complicated math problems that verify transactions in the currency. When a bitcoin is successfully mined, the miner receives a predetermined amount of bitcoin.
The computer hardware required is known as application-specific integrated circuits, or ASICs, and can cost up to $10,000. If a miner is able to successfully add a block to the blockchain, they will receive 6.25 bitcoins as a reward.
The reward amount is cut in half roughly every four years, or every 210,000 blocks. As of January 2022, bitcoin traded at around $43,000, making 6.25 bitcoins worth nearly $270,000.
Graff invested in bitcoin using an app called CoinBase, which allows users to buy, sell and trade cryptocurrency.
After holding on to it for quite some time, Graff decided to sell some of his holdings to a stranger he met online. He went on localbitcoins.com, a site that sets up meetings between bitcoin buyers and sellers, and proceeded to drive from Oregon to Washington and sell his bitcoin.
He met him at Starbucks, counted the money and ensured all the bills were real. He transferred the bitcoin and left with his $9,000.
The money paid for the entirety of Graff’s mission for The Church of Jesus Christ of Latter-day Saints with some cash to spare. Despite his parents’ skepticism surrounding cryptocurrency, Graff says they are happy he is financially stable and able to pay for everything himself.
Graff’s investment success enabled him to pursue a field of study he hadn’t previously thought was possible: math education.
“I wouldn’t be doing math ed if the crypto stuff didn’t take off,” Graff said. “A lot of people say that teachers don’t get paid enough, but I’m able to teach because I have investments from high school that are paying out.”
Graff believes cryptocurrency is a good way for financial novices to better understand investing without becoming overwhelmed by the New York Stock Exchange. “It does provide a lot of financial opportunity for people who don’t know how to best navigate hardcore Wall Street stuff,” Graff said.
Cryptocurrency at BYU
Graff is not the only student at BYU interested in cryptocurrency.
Seniors Jacob Fairchild and Cole Benson started a BYU Crypto Club last August. Juniors Trevor Dustin and Brian Redd are the club treasurer and co-president, respectively. Club members meet every Tuesday night to discuss new projects, investment strategies and share personal opinions on various cryptocurrency.
“We get in a room with a bunch of guys that know what they’re talking about when it comes to crypto and answer questions on the hottest coins out there, most stable coins, just different types of investing,” Dustin said.
Dustin has been investing in stocks since high school and believes cryptocurrency is another way to beat inflation and the market. He said the club has helped him further his knowledge of cryptocurrency and discover projects he never would have found on his own.
In addition to club meetings, Dustin credits sites like YouTube and Google as his main sources of cryptocurrency knowledge.
“It’s a free education,” Dustin said. “Google up a coin, see what’s going on. I have a Wall Street Journal account too and read up on crypto articles there as well.”
Redd, on the other hand, utilizes online MIT courses taught by bitcoin developers, such as MAS.S62 Cryptocurrency Engineering and Design, to increase his understanding on how bitcoin and other cryptocurrency is made.
Redd’s official position in the BYU Crypto Club is chair of cryptography. Cryptography is a method of protecting information and communications through the use of codes, so only those for whom the information is intended can read and process it.
“It’s a silly title, but basically I like the technology of cryptocurrency and I just talk to the club about the technical sides of cryptocurrency,” Redd said.
As an electrical engineering major, Redd said he enjoys learning how cryptocurrency works and the logistics of the computer science behind it.
Most of the club members are part of BYU’s business program, including Dustin. He thinks more professors should discuss cryptocurrency in their lectures and include it in their course curriculum.
“I think the more financial literacy the better,” Dustin said. “There’s a lot of great finance classes and I think that crypto should be involved in those classes.”
Though there are no classes on cryptocurrency being taught in the BYU Marriott School of Business, there is one offered to BYU law students.
LAW 775 Blockchain and Cryptocurrency Law goes into the investigation of market, regulatory and enforcement challenges regarding private payment systems, cryptocurrencies and other uses of blockchain technology.
Professor Matt Jennejohn began teaching the class in 2018. The class focuses on additional platforms that have emerged after bitcoin like ethereum.
Ethereum is a decentralized, open-source blockchain with smart contract functionality. LAW 775 teaches students how to create legal documents on a blockchain and discusses the security benefits that come with it.
“Here in the law school, we train students how to draft and litigate natural language contracts, and this is just kind of moving that over into the digital space,” Jennejohn said.
Large corporations like Microsoft, Amazon and Walmart are among 27 companies with live blockchain operations. The operations help manage invoices, verify transactions and secure legal information.
Jennejohn hopes to teach LAW 775 to all law students, graduate and undergraduate, to better prepare them for what’s to come.
“I think a lot of our students are gonna be moving into this space either as their entire practice or just a part of it, and they are gonna have to be ready for that,” Jennejohn said.
In addition to law students, those in the BYU media arts program have a unique opportunity to get involved in a different aspect of cryptocurrency: non-fungible tokens, or NFTs.
Scott Cunningham, CEO and Co-Founder of SDGuild and former BYU student, reached out to BYU animation students for help with designing his NFT project for the Lindau Foundation.
Cunningham plans on creating an online game where users can spin a wheel and win points, moving them on to the next round in a tournament. Wheel prizes vary from cash to rare NFTs inspired by the popular Netflix show “Squid Game.”
Cunningham describes NFTs as digital pieces of media like an image, video, PDF or sound. These digital pieces of media accrue value based on the credibility of the artist in the physical world, the nature of artwork, effort put in the creation of artwork, the story behind the artwork and the social currency of the artist.
“Nonprofits are always looking for money and they never know how to figure it out so I thought, ‘Let’s make some NFTs because people are spending a lot of money on them,’” Cunningham said.
He began looking for students to help design the NFTs after struggling with other workers to create the vision.
“I found it hard to find designers where I thought, ‘I actually think what you made looks good,’” Cunningham said. “I know there’s really talented students, and I know college students are the demographic that cryptocurrency and NFTs are the fastest growing in, so I reached out.”
A study conducted by the Pew Research Center in November 2021 showed that 43% of men ages 18–29 and 19% of women ages 18–29 said they had invested in, traded or used cryptocurrency. These percentages have drastically increased since a similar study was conducted in 2018.
As cryptocurrency’s popularity rises, financial regulations on cryptocurrency payments have only increased. China first prohibited financial institutions from engaging in any cryptocurrency transactions in May 2021 and outlawed cryptocurrencies outright in September.
U.S. Federal Reserve Board Chairman Jerome Powell said last summer that these currencies need more regulation, and the Biden administration is trying to combat ransomware by cracking down on cryptocurrency payments.
At the same time, El Salvador became the first country to declare bitcoin as legal tender in September.
While cryptocurrency is known for being extremely volatile, a myriad of investors and economists agree it’s here to stay. Last May, private equity billionaire David Rubenstein told CNBC, “Cryptocurrency is not going away, just like gold is not going away.”
Around the same time, Cathie Wood, investor and founder of Ark Invest, said bitcoin is “already on its way and it’ll be impossible to shut it down.”
Elon Musk, CEO of Tesla and richest man in the world with a net worth of $223 billion, said during “The B-Word” conference he would like to see bitcoin succeed and mentioned plans to hold on to it long-term.