Trading in Code
Florida's bid for bitcoin
Digging for Digital Gold?
Like many crypto devotees, Samuel Armes views bitcoin as a digital version of gold. “So gold’s really hard to mine, and it’s really hard to find. We all know that, and so that has made it valuable over time because its inflation rate is low. It always held a similar value,” says Armes, who works as an analyst at a cryptocurrency hedge fund called Hyperion Decimus and heads up the Florida Blockchain Business Association. “Bitcoin is the exact same. Bitcoin is this currency that’s mineable, has a high stock-to-flow ratio, has a limited amount, ergo it’s deflationary, meaning it’s going to retain its value over time.”
Armes’ own introduction to bitcoin was in high school when a buddy gave him his first digital token. “I had no idea what it was, but I said, ‘Sure, why not.’ ” His formal cryptocurrency education came a few years later, he says, when he did a stint at U.S. Special Operations Command at MacDill Air Force Base in Tampa researching bitcoin, cryptocurrency and “counter threat finance.”
He also briefly served as “blockchain director” for Seminole County Tax Collector Joel Greenberg. At Greenberg’s office, according to WKMG News 6 in Orlando, Armes oversaw a project to create a digital identification system using blockchain. The project was shortlived, and so was Greenberg’s tenure. Greenberg stepped down in June 2020 after federal authorities indicted him on charges of stalking and identity theft. Greenberg is currently in jail, awaiting sentencing after pleading guilty to sex trafficking, fraud and other charges.
Cryptocurrency appears to have played a big part in Greenberg’s downfall. According to an 86-page plea agreement that Greenberg struck with prosecutors in May, “one of the focuses of Greenberg’s fraud scheme related to his desire to acquire cryptocurrency for himself.” Between 2017 and 2019, Greenberg took hundreds of thousands of dollars out of tax collector accounts to purchase cryptocurrency for himself. With taxpayer funds, he also purchased $68,700 worth of cryptocurrency mining machines — some of which he sold, and others he kept and operated at the Lake Mary tax collector’s office to produce cryptocurrency for himself.
“Those machines were damaged in a fire, which occurred due to a power surge caused by the way in which the machines were daisy-chained together,” the plea agreement states. “The expenses incurred for the server room buildout, fire damage and server room teardown in the Lake Mary branch were approximately $98,000.”
Armes had little to say about his former boss. “I am not able to discuss Greenberg, nor do I want to,” he said in an e-mail. “Unfortunately, he’s really given the community here in Florida a bad name. But luckily, no one has been hurt, and our work continues!” That work, he says, includes getting Florida to update its money transmitter laws, which have proved a stumbling block for many businesses. “When we take care of those, Florida will probably be a leader in the space,” Armes says.