it's all about the bitcoin baby

Bitcoin Whiz Charlie Shrem Says ‘There Are Holes’ in His Money-Laundering Case

Under house arrest, he had permission to attend a screening of the bitcoin documentary in which he appeared.
charlie shrem bitinstant bitcoin silk road

Mr. Shrem’s Twitter photo.

“This is kind of a premiere for Charlie,” New York Times reporter Nathaniel Popper joked last night. “This is the first time I’ve seen you out of the house.”

Mr. Popper and former BitInstant CEO Charlie Shrem were sitting on the stage at the School of Visual Arts theatre. Mr. Shrem was arrested in January on charges of money laundering associated with his bitcoin exchange company, BitInstant. He’s currently under house arrest, but was allowed to attend last night’s panel on the documentary The Rise and Rise of Bitcoin, in which he’s a prominent character.

Filmmakers Nicholas Mross and Daniel Mross joined Mr. Shrem and Mr. Popper onstage, following a screening the documentary.

The documentary follows bitcoin magnates like Mr. Shrem, Jered Kenna of Tradehill, Gonzague Gay-Bouchery of Mt. Gox and Mike Caldwell of Casascius Coins.

Mr. Shrem is one of the film’s main characters, and the audience watches as his company, BitInstant, explodes. His group provides many of the funniest moments of the film, with one T-shirted young employee chuckling, “This is my first day. It’s overwhelming.” And after a pause: “I’m the CFO.”

But at the end of the movie, the filmmakers include a kind of epilogue about the problems that rocked the bitcoin community in early 2014 — Mt. Gox and Tradehill shutting down, that Newsweek article, and, of course, Mr. Shrem’s arrest.

Mr. Shrem was arrested and charged with money laundering in January. He’s currently under house arrest, but received permission to attend the talk in the School of Visual Arts Theatre for the Tribeca Film Festival last night.

Ironically, in an earlier part of the movie, Mr. Shrem expresses a fervent hope that he won’t go to jail due to bitcoin’s lack of regulation.

“I talk to lawyers every day so I won’t go to jail,” he says. “I don’t want to go to jail. It’s terrifying.”

Later, he describes the day in January when he was arrested at John F. Kennedy International Airport and taken into an interrogation room.

But, he insists, “we found a lot of mistakes and holes in the case.”

“What sucks is the house arrest,” he continues. “I have to pretty much be here [at his mother’s home in Brooklyn] all the time, every day. I can’t even go outside. Unless I’m going to my lawyer’s office, which is once or twice a week. I pretty much lost my freedom and lost everything I built over the past year.”

In the talk after the show, Mr. Shrem was incredibly hopeful about the future of bitcoin.

“There’s a place for bitcoin in the heart of every person,” he said. “Some day 10 years from now, 20 years from now, bitcoin will be powering the underlying infrastructure of our banking system, or the way I send money to you, or to me, or from one person in China to pay for a surgery that needs to happen at 2 in the morning on a Saturday night, or for anything.”

He admitted that the “smallest things can affect the price of bitcoin,” but added that “how people think and feel about bitcoin” is most important.

Mr. Shrem is currently consulting while he awaits trial.

“If I can’t use my brain,” he said, “I’m more than happy to let other people use it.”

Follow Molly Mulshine on Twitter or via RSS. mmulshine@observer.com