Introduction: Brooklyn’s Most Profitable Failure

In “My Brooklyn”, the 2013 documentary by Kelly Anderson, Fulton Mall is described as a sort of last vestige of the black community that was so prominent in Brooklyn from the late 1970s until the early 2000s. Downtown Brooklyn was the nucleus of a tightly-knit yet predominantly lower-income community riding out one of the worst periods in urban history, in terms of crime and poverty in the city. This was in many ways the result of planning decisions, such as rezoning and ‘redlining’ communities based on the prevalence of minorities, carried out in large part through the cooperation of banks and government officials in response to the Great Depression. The excessive involvement of the government in securing credit for homeowners led to an exodus of the middle class from Brooklyn, which was responsible for the ensuing urban sprawl and the stagnation of the inner city. In the wake of this demographic shift, Fulton Mall was transformed from an upscale shopping center known for its multiple department stores to a significantly less attractive strip known for its multiple pawn shops and shoe stores. However, despite its appearance the mall remained popular and was long the third most profitable shopping district in New York City, after Madison Ave and Fifth Ave, thanks to many local entrepreneurs, mostly black, hispanic and asian, who adapted to the area’s changing values.

Today Fulton Mall is again undergoing a dramatic transformation, in response to another demographic shift. Since the early 2000s Brooklyn has become known as a hip place to live, and in 2004 the Downtown Brooklyn Plan was proposed to develop the Fulton Mall area, which once again proved to be highly valuable real estate. In 2007 the Albee Square Mall, made famous by Brooklyn hip-hoppers such as Biz Markie, was evacuated and demolished to make way for mixed-use development City Point, displacing many local entrepreneurs and driving up rental prices in the surrounding area. As local small businesses relocate they are gradually replaced by brand name retail outlets such as H&M and Armani Exchange. Again, this recent development has been largely driven by collusion between city planning officials, bankers, and developers, and supported by major real estate subsidies and tax breaks. As City Councilman Charles Barron points out in the film, “When they get money it’s ‘subsidies.’ When we get money, it’s ‘welfare.’ Either we are on subsidies and they’re on subsidies or we are on welfare and they’re on welfare.”

It is clear that Fulton Mall is changing, that the change cannot be stopped, and that the change has as much to do with monetary policy as with race relations, if not more so. Downtown Brooklyn has historically been a place where entrepreneurs and locals had close interpersonal relationships. Many of the street vendors, selling hip-hop and reggae cds for cash, have been marketing their wares at the mall for years, even decades, and are often surrounded by a congregation of regular customers. The direct social interactions and transactions between customer and vendor characteristic of the waning cash-only economy, still present in a few Fulton Mall stalwarts such as the Fulton Hotdog King and Souvlaki House in addition to the myriad street vendors, stands in stark contrast to the effects that banks and credit cards have had on the neighborhood. From the rapid construction of luxury residential towers and the subsequent bursting of the housing bubble to the crowding-out of small businesses and their replacement with brand name retail chains, credit has not been good for Downtown Brooklyn. With that in mind, the last thing Fulton Mall needs is another bank.

A Bitcoin Bank??

In early 2014, as part of my studio curriculum at the Columbia University Graduate School of Architecture, Planning and Preservation, I was tasked with designing a bank for Fulton Street Mall, on a site facing Albee Square next to the old Dime Savings Bank and the new City Point development. My studio, led by Prof. Karel Klein, added an interesting twist: we were to design the bank as a Bitcoin mining colony. The mysterious cryptocurrency had been featured heavily in the media toward the end of 2013 due to its association with the anonymous online black market Silk Road and its meteoric rise in price following the seizure of the site by the FBI. The Bitcoin protocol, first proposed in 2008 by the enigmatic individual or group known as Satoshi Nakamoto, relies on a distributed network of computers around the world performing the ‘mining’ operations that circulate the bitcoins and add recent transactions to the public ledger. This key innovation, known as the blockchain, was born out of a distrust of large banks and central governments, and thus the concept of a Bitcoin bank was naturally perplexing. Most projects incorporated aspects of data center design, and while it is true that the escalating difficulty of the mining process has led to an increasing concentration of power in large server farms, it is not the correct solution for the context of Fulton Mall.

The skyline of Downtown Brooklyn may be dominated today by luxury apartments and office buildings, but at its heart is the entrepreneurial spirit of the marketplace. Fulton Mall is a retail center, yet it is unclear who will shop there in 5-10 years. Bitcoin is an alternative currency, but it is hard to say whether it will ever find a killer-app and penetrate the mainstream. Without transactions to add to the blockchain, a Bitcoin mining colony is useless. If nobody is spending their bitcoin, what’s the point? The true potential of Bitcoin’s presence at Fulton Mall does not involve a massive data center, but rather a series of strategic interventions aimed at integrating the peer-to-peer currency into the existing market culture.

Cash, the original peer-to-peer currency, is still preferred by many small businesses on the mall. Those local entrepreneurs who do accept credit typically require a minimum card transaction value between $5-10 to avoid excessive fees and paperwork. Yet while cash transactions can be seen to symbolize the direct interpersonal relationships that have historically defined Fulton Mall, it has been nearly impossible for small businesses to attract customers today without accepting credit cards. Cash is an obsolete monetary technology, a relic of physical currency in an digital age defined by floating point exchange rates and determined in large part by complex trading algorithms. In order for people to take back control over the value of money, cash must evolve to meet the demands of the 21st century. Bitcoin is digital cash.

Strategic Urban Interventions

The idea of a Bitcoin bank is an oxymoron. Bitcoin developed as a response to a growing distrust of banks. Data centers may indeed replace banks as the dominant typology of monetary infrastructure, but they will not be located in dense urban centers such as Downtown Brooklyn. Fulton Mall is a shopping district, and it is here that Bitcoin has the potential to gain traction as a currency. This can be done with a series of tactical interventions, targeting specific scenarios along the mall where Bitcoin has the most potential to attract attention and effect change.

Bitcoin ATM: The ATM located immediately outside the cash-only restaurant is as ubiquitous as it is annoying. It is the store-owner’s way of passing off the credit card fee to the cash-strapped customer. On the other hand, there have been many Bitcoin ATMs popping up all over the world, including two in Manhattan and one in Williamsburg. These machines allow shoppers to buy bitcoin with cash, helping facilitate the transition from physical to digital peer-to-peer currency. By pairing these ATMs with additional kiosks, such as vending machines, this intervention encourages customers on Fulton Mall to spend Bitcoin as casually as buying a cup of coffee.



Bitcoin Street Vendor: One of the most interesting aspects of Fulton Mall is its plethora of street vendors, selling everything from CDs and DVDs to perfume and incense. These local entrepreneurs are key to the strong community bonds that have formed over the years between the Mall’s customers and small businesses. This makes them the perfect group to introduce the community to the benefits of cryptocurrency. Beyond simply preaching the Bitcoin gospel to their friends and frequent customers, street vendors could benefit by hosting an urban popup mining network. By tapping into the fans used to cool the computers that add transactions to the blockchain, these portable mining rigs could be used to inflate balloons for advertising their wares and drawing more attention to the Bitcoin network.



Bitcoin Street Cart: Street carts are common in New York City, but at Fulton Mall it seems there’s someone selling hot dogs or street meat on every corner. These street carts only accept cash, because the food is cheap and they can’t afford the credit card fees. When Fulton mall was known for its bargain stores and pawn shops cash was common, but as more and more upscale retailers move in customers will tend to visit the mall with only their credit cards, or perhaps just their smartphone with PayPal or Apple Pay. Cash is not convenient for customers to carry around, and for street vendors it can be a security liability. Bitcoin is both safer and more convenient than cash, and if a street vendor at Fulton Mall were to begin accepting Bitcoin payments they would likely gain additional customers, as early adopters of the cryptocurrency are typically excited to support the growing community and will routinely go out of their way to spend it. One street vendor at Fulton Mall could potentially influence others around the city to accept Bitcoin as well.

Bitcoin Street Art: On the site of the original bank proposal there is a three story building, the ground floor of which is currently occupied by a shoe store and a fried chicken restaurant. The facade above street level, facing Albee Square, has been boarded up and is used to display advertisements for the stores below. This billboard-like surface could be converted into a site-specific installation, addressing the entire mall and promoting the spending of Bitcoin at local businesses. A 25×25 grid of 12” square panels would light up in animated patterns and display QR codes. Any time somebody makes a purchase at the mall using Bitcoin, a QR code might link to the transaction recorded in the Blockchain. This both encourages spending Bitcoin by connecting it to a piece of public interactive art and educates consumers on the semi-public nature of the Blockchain, which displays every transaction but hides all personal details. QR codes displayed on the wall might also link to coupons or advertisements.

Bitbroker: On the ground floor of the building you’ll find the Bitcoin Pawnbroker, or Bitbroker. Pawn shops are plentiful at Fulton Mall, which contributes to the strip’s reputation for seediness. However, pawnbrokers have a long history of providing loans to anybody willing to pledge their personal property as collateral, dating back much further than the invention of personal checks and credit cards. The general principles behind pawnbroking, based on market forces and the basic premise that you can’t spend what you don’t have, are essentially aligned with the values of the Bitcoin community.

Brooklyn Bitcoin Incubator: The empty and boarded up windows on the upper levels of Fulton Mall have consistently been a subject of debate. Many property owners have removed the stairs in the buildings lining Fulton Street altogether, as the street level real estate is much more valuable. Recent plans have proposed converting these upper levels into office space, aiming in particular to attract the creative professionals and tech start ups flooding other parts of the borough. With this in mind, a Brooklyn Bitcoin Incubator space could lure in talented professionals developing innovative strategies for further integrating cryptocurrency at the mall. Thanks to their proximity, the Bitcoin startups would be in an excellent position to reach out to the local businesses and assist with training and support.

Above the converted offices, unoccupied floors could be retrofitted to house the server farms for mining bitcoin. These servers would be part of a local network mining pool, so that any rewards for solving blocks are distributed among the community. Professionals from the Bitcoin Incubator would maintain the hardware and pay for the electricity. Rather than building a new data center in the heart of Brooklyn, it is better to embrace the distributed nature of Bitcoin by spreading it out across the space that already exists.

Conclusion

It is the intention of this proposal to make the case that the original brief calling for a Bitcoin bank at Fulton Mall was inherently contradictory, stemming from a misunderstanding of both the politics of Fulton Mall and the politics of Bitcoin. Bitcoin and Downtown Brooklyn go together like jewelers and pawn shops, and neither wants to be associated with the banks or anything resembling them. Cryptocurrency is the anti-bank, and its greatest potential lies in empowering individuals to counteract the sinister effects of centralized financial institutions with the power to exert undue influence on dynamic socio-economic systems. In order for this to happen, Bitcoin must become more than a commodity, bought and sold like gold or stocks by traders, motivated by the market’s volatility to make a quick profit, or hoarded by techno-evangelists with an unflinching faith in its long-term value but with no interest in spending their precious coins in the present. Bitcoin must break into the mainstream if it is ever to be taken seriously as a currency, and to do so it should take advantage of the socio-political environment at Fulton Mall. Downtown Brooklyn doesn’t need another bank. Rather, it needs an 21st century alternative to cash. This is what Bitcoin is all about.