Miami Is the Hot New Crypto Hub, Leaders at FTX and Blocktower Capital Say

• Miami, Florida, is quickly becoming the center of the cryptocurrency universe.
• Francis Suarez, the city’s mayor, shared his crypto vision as he courts industry leaders.
• Leaders at FTX and BlockTower Capital shared why they moved and advice for crypto startups.

Forget Silicon Valley. Francis Suarez, the mayor of Miami, Florida, is building a “crypto coast.”

Arguably no politician has been friendlier toward the budding cryptocurrency industry than Suarez. The 44-year-old Miami native and former member of Florida’s “Blockchain Task Force” announced plans last fall to become the first American elected official to get paid in bitcoin, just months after introducing a token called “MiamiCoin” — the nation’s first “CityCoin.”

Those unprecedented steps came after cryptocurrencies exploded in both popularity and value during the pandemic. Some advocates say that digital assets are a way of decentralizing finance and making global payments cheaper and easier. Others think crypto is just a way to make a quick buck.

Suarez’s pro-crypto pitch, as told to Insider in a recent interview, is simple: The US economy increasingly revolves around technology, and cryptocurrencies will inevitably play a key role in its future. And, most importantly to Suarez, Miami is where that future will be built.

Even more idyllic than the city’s weather and scenery is its tax environment: In Florida, there’s no state income tax, and the top corporate income tax rate is just 5.5%. The nearby Turkey Point nuclear reactor is a bountiful source of relatively cheap carbon-free energy. It has a leader in Suarez who’s all-in on crypto, and other local politicians also appear to be supportive.

What’s not to like? As crypto firms flock to Miami in droves, that question gets harder to answer.

“I can’t imagine there’s a better business climate than Miami right now for all things crypto,” said  Michael Bucella  — a partner and global head of strategic partnerships for BlockTower Capital, a crypto investment firm that moved to Miami in 2021 — in an interview with Insider.

Suarez loves the crypto industry — and vice versa

In December 2020, with a few keystrokes and just four words, Suarez took the first step toward making Miami a destination for crypto companies.

How can I help? https://t.co/hIC1k8ka1i

— Mayor Francis Suarez (@FrancisSuarez) December 5, 2020

A politician asking how he could help support the nascent crypto industry was a stark contrast from the disdain and regulatory threats that crypto execs often hear from Washington. Suarez, who said he’s been a believer in cryptos and the blockchain technology that powers them for at least four years, saw an opportunity to help his city stand apart and attract new jobs.

“We started little by little, putting in place the building blocks to thrive in that kind of environment,” Suarez said. “Obviously a year ago, approximately, that ecosystem building project accelerated itself. We did probably 10 years worth of acceleration in 12 months after the ‘How can I help?’ tweet.”

While cryptos have gotten a frosty reception from federal regulators, it’s a no-brainer for mayors to open their arms toward companies like Blocktower Capital, Blockchain.com, FTX, and eToro — all of which have either relocated to or invested heavily in Miami in the past year.

“Mayors rationally want to attract high-income citizens who pay their taxes and impose few costs on the municipality,” said Joseph Grundfest, a law and business professor at Stanford University, in a January 25 story from The New York Times. “Crypto geeks fit this bill perfectly.”

Cynics may say that courting crypto companies shouldn’t be a priority for Suarez. Some critics, like JP Morgan CEO Jamie Dimon, believe that bitcoin has “no intrinsic value.” Others, including Jillian Crandall of the Rensselaer Polytechnic Institute, advocate against what she calls “crypto colonialism” — where digital assets are used to enrich the rich instead of empowering the poor.

Suarez has surely heard it all before. But he’s not backing down — he’s doubling down.

“Anytime you’re doing something that’s innovative, you’re always going to have naysayers,” Suarez said. “It’s very easy to be a doubter, very easy to be a naysayer. Because if you just keep doubting, if it somehow comes to be true, you look brilliant. If it doesn’t, nobody remembers that you were a naysayer, right?”

Suarez continued: “I think bitcoin and crypto have proven all the naysayers wrong over a long period of time. So I wonder: When is the point that the naysayers are going to sort of admit that there’s something here that’s unique and different and innovative?”

‘Get down here’: Crypto execs set up shop in South Beach

Since Suarez sent out the crypto industry equivalent of the Bat-Signal with his now-famous “How can I help?” tweet, the Miami mayor said his city has become an “epicenter of capital” for crypto.

South Florida’s crypto scene is now benefiting from the flywheel effect: Companies moving to the city make it an ideal spot for networking, hosting industry conferences, and finding the next hot startup to invest in, which then attracts more firms and further perpetuates the cycle.

Bucella, the partner at Blocktower Capital, and Zach Dexter, the CEO of US Derivatives at FTX, both cited Suarez’s social media activity, in addition to the newfound freedom that hybrid work offered, as key reasons why their firms now have a major presence in Miami.

Blocktower Capital’s leaders started looking for a new long-term home for the firm in 2020 after years of navigating a New York-Connecticut work setup, Bucella said. A handful of Bucella’s venture capital and crypto friends had raved about Miami and encouraged him to join them, which led him to visit the city and send Suarez a direct message through Twitter during his stay.

An “immediate” response from Suarez led to a meeting days later in the mayor’s office, Bucella said, and the rest is history.

Even in the short time Blockchain Capital has called Miami home, Bucella said he’s seen the crypto community grow “exponentially.” Bucella said he has a half dozen meals and meetups per week with crypto contacts beyond working hours — and added that he typically has to turn down another half dozen or so.

“My installed network from the traditional investment world and then the sort of VC, private equity, and tech world was much larger than I anticipated,” Bucella said. “To the point where the business climate was better in Miami and currently is better in Miami than it was pre-COVID in New York.”

Dexter, who runs FTX’s Miami-based US Derivatives arm, seconded that sentiment: “It almost feels like moving to New York in like 2012 all over again when Silicon Valley was just starting up. You’ve got that same kind of young, tech hub energy.”

FTX made a lasting mark on Miami in multiple ways: by opening a permanent office that’s tucked between its Nassau, Bahamas, headquarters and its main US base in Chicago — a move that Dexter said was Suarez’s “How can I help?” tweet was the “spark” for — and by inking a 19-year, $135 million deal for the naming rights to the arena of the NBA’s Miami Heat.

Since the deal, Dexter said he’s seen people walking around Miami in shirts sporting FTX’s logo. And no, he said, they aren’t his colleagues at the crypto derivatives exchange.

Miami is quickly becoming the center of the crypto universe, thanks in large part to Suarez — who directly or indirectly played a role in Blocktower Capital and FTX moving to the city. Dexter encourages other crypto leaders to visit South Florida and test the waters themselves.

“Live at the center of the action — live in Brickell, get down here, rent some space in Brickell,” Dexter said. “It’s a great place to come down and start something.”