Let’s start this column off with a question that would seem ridiculous just a year ago: Will the price of Bitcoin have an impact on turnout at the 2018 World Series of Poker?
The question sounds a bit daft on its surface, but with so many poker players heavily invested in cryptocurrencies, unless there is a rebound, there could be widespread ramifications for the poker economy — the WSOP in particular.
Panic time for Bitcoin investors?
After riding the Bitcoin wave to a high of $20,000, the cryptocurrency, and most of its lesser known relatives have plunged. Bitcoin has lost nearly two-thirds of its value over the course of just a few weeks. At the time of writing Bitcoin was trading at around $7,000.
— Seth Young (@sethyoung) December 23, 2017
Wait, isn’t Bitcoin still way up?
Even at $7,000, Bitcoin is up substantially. Bitcoin was trading at just over $1,000 on April 1, 2017, before exploding to $20,000 by December.
And since the poker community was an early adopter of Bitcoin – there were plenty of poker players buying Bitcoin when the cryptocurrency’s worth could be measured in hundreds-of-dollars – it stands to reason that most are still very happy with their gains.
Even if you were a skeptic and were a bit late to the Bitcoin party you could have still cashed in if you bought some BTC sometime before Thanksgiving.
Needless to say, a lot of poker players were getting rich speculating in BTC and other cryptocurrencies.
If btc hits $14k by next June I'm buying the rio and turning it into a parking lot
— Jason Mo (@cuntycakes123) June 11, 2017
But many of them were also still buying BTC as it went up in value.
They were buying at $5,000. At $8,000. At $10,000. At $15,000. And some were even buying at $18,000 and $20,000.
If your panic selling I’ll take some tho
— Daniel Strelitz (@dDeoxyribo) January 16, 2018
Things I enjoyed doing while I was rich:
– Reg’ing the Sunday Grand
– Buying BLOCKv at the ATH
– Purchasing first editions of obscure John Updike novels
– Overusing the word ‘bullish’
– Mispronouncing the word ‘Fibonacci’
– Attempting to convince my Uber driver to but BTC at 16k
— Sam Grafton (@SquidPoker) February 6, 2018
Point being, even if they bought in early, a lot of those gains would be completely wiped out if they continued buying or spent like cryptocurrencies would continue to rise, and the Bitcoin investors who were a bit late to the party and kept buying are likely in the red.
Where would the WSOP feel the pinch?
Since most of the WSOP attendance in Nevada comes from large field NLHE tournaments and the Main Event, the overall attendance numbers are unlikely to be affected if Bitcoin’s price stays under $10,000.
That said, certain events at the 2018 WSOP could feel the pinch.
$10k events at the WSOP are heavily reliant on professional poker players, and plenty of these players are big on cryptocurrencies.
A confluence of events brought about the poker boom, but an oft-overlooked factor was the booming economy of the mid-2000’s. Not only did a lot of people catch the poker bug, they also had some disposable income to fly to Vegas and play in the WSOP and other high-buy-in tournaments.
After the Great Recession of 2008 there were far fewer amateur players participating in big buy-in tournaments, and you started to see WPT Main Events lower their buy-ins, and the rise of mid-major tours with $1,500 Main Events.
The economy is rebounding, but there is still an economic hangover thanks to the Great Recession of 2008 still being fresh in everyone’s mind. These people still play poker, but it’s rare to find them in $10k tournaments.
As such, the majority of the field in $10k Championship events at the WSOP are professional players; professional players who are likely to have crypto in their portfolios.
Jokes aside: I suggest to make risk management a high priority. Its a tail-heavy investment. I trade less than once a week (I’m mainly bullish on the tech) and react to events. I keep around 7-25% of my net worth in crypto. So I sold on the way up and start buying more now.
— Fedor Holz (@CrownUpGuy) February 6, 2018
If the price stagnates, or continues to drop, Bitcoin’s downward spiral could have a negative impact on these events. Not only could it lead professionals to play a limited schedule, it could also dry up some of the backing/swapping opportunities professionals use to limit variance in these big-buy-in tournaments.
Of course, if Bitcoin rebounds none of this will matter.