The key ideas

The Cryptopians: Idealism, Greed, Lies, and the Making of the First Big Cryptocurrency Craze

Laura Shin, 2022

A nineteen-year-old programmer dreams up a network that needs no boss. Four years later it is worth tens of billions of dollars, and in that time its founders manage to fall out, lose and win back money, live through the biggest hack and split the network in two. This is the story of Ethereum, told through hundreds of interviews: how idealism, greed and lies together created the first big cryptocurrency craze.

Who it is for

For anyone who has heard of bitcoin and ether but doesn’t know how the second-largest cryptocurrency was really born. And for anyone curious about what happens to people when they come into hundreds of millions in a couple of years.

Need to differentiate between getting hundreds of billions of dollars of digital paper wealth sloshing around and actually achieving something meaningful for society.

A walk in the Presidio

November 2013, San Francisco. Nineteen-year-old Vitalik Buterin wanders for several hours through the Presidio, a wooded park near the Golden Gate Bridge, turning one problem over in his mind. Every blockchain back then could do one thing, like a calculator. A blockchain here means a shared ledger of records that thousands of computers keep and that can’t be secretly rewritten. Vitalik wants to build a blockchain that works like a smartphone: any developer will be able to run any app on it.

On November 27 he sends a description of the idea to thirteen friends. That same day, bitcoin costs more than a thousand dollars for the first time.

Journalist Laura Shin spent more than three years reconstructing what happened next and conducted over two hundred interviews with almost all the main players. The result is the story of Ethereum and of the first big cryptocurrency craze.

The book’s subtitle names the three forces of this story: idealism, greed and lies. The technology was invented to depend less on trusting people. But people built it, and almost every crisis began not with the code but with people.

Google or Mozilla: the eight founders’ quarrel

In January 2014 the team gathers in a rented house in Miami, and many of them see each other for the first time. Vitalik proposes doing without a hierarchy and without a special share of coins for the creators. Anthony Di Iorio, who paid the first expenses, insists: there must be founders and a reward for those who put money in. Gavin Wood, who meanwhile is writing code at the dining table, fights for a place among the founders. In the end there are eight of them.

Then the argument grows. The business side of the team wants a commercial company like Google. The developers want an open nonprofit project like Mozilla. And CEO Charles Hoskinson, who asked for the post himself, tells his housemates about jumping out of helicopters in Afghanistan and about ties to intelligence, and tells one housemate that he created bitcoin. Programmer Taylor Gerring puts together a dossier on him, and not one of the stories checks out.

On June 3, 2014, in the team’s house in Switzerland, everyone takes a turn saying what they think. The decision falls to Vitalik: the leadership is dissolved, and he will choose whom to bring back. He paces the balcony for an hour and doesn’t call Hoskinson back. Soon, instead of a company, a Swiss nonprofit foundation appears. Shin shows that even in a project without a boss, people’s goals still collide.

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About the author

Laura Shin was a senior editor at Forbes who wrote about cryptocurrencies, and now hosts the podcast Unchained. For this book she spent more than three years gathering material and conducted over two hundred interviews.

All books by this author: Laura Shin

Terms from the book

  • Goethe
  • blockchain
  • Wood
  • ether
  • token
  • Securities and Exchange Commission
  • Buterin: Vitalik Buterin, a programmer born in 1994 in Kolomna, Russia, and raised in Toronto. He came up with Ethereum at nineteen and became the project’s central figure.
  • Presidio: A park on the site of a former military base in San Francisco, near the Golden Gate Bridge. It is where Vitalik worked out how Ethereum would be built.
  • bitcoin: The first cryptocurrency, launched in 2009. Its creator is known only by the pseudonym Satoshi Nakamoto.
  • Ethereum: A blockchain that can run any program, not just transfer money. It has been running since July 2015.
  • Di Iorio: Anthony Di Iorio, a Canadian entrepreneur who got rich on early bitcoin. He put up the first money for Ethereum and became one of its eight founders.
  • Mozilla: A nonprofit that makes the open-source Firefox browser. In the founders’ arguments it stood for a project built for the common good.
  • Hoskinson: Charles Hoskinson, a mathematician from Colorado and Ethereum’s first CEO. After leaving, he founded the Cardano network.
  • Gerring: Taylor Gerring, a programmer from Chicago who worked on Ethereum’s website and infrastructure. He put together a dossier on Hoskinson.
  • Jentzsch: Christoph Jentzsch, a German programmer who used to test Ethereum software for bugs. One of the founders of Slock.it and the author of the DAO code.
  • Slock.it: A German startup that made smart locks that open after a payment in Ethereum. Its team wrote the DAO code.
  • DAO: A decentralized autonomous organization: a group whose rules are written into a program, with decisions made by token holders voting. The DAO of 2016 became the best-known example.
  • smart contract: A program on a blockchain that carries out prewritten conditions by itself, for example taking in money and issuing tokens.
  • Wilcke: Jeffrey Wilcke, a Dutch programmer and one of the founders of Ethereum. He led the team that built Geth, the most popular software for running the network.
  • Robin Hood: The name volunteers gave their group, which used the same vulnerability to drain the remaining money out of the DAO so that the thieves couldn’t take it.
  • hard fork: An update to a blockchain’s rules that is incompatible with the old ones. If some participants don’t accept it, the network splits in two.
  • Poloniex: An American crypto exchange, the main venue for trading ether in 2016 and 2017. In 2018 it was bought by the company Circle.
  • Ethereum Classic: The earlier version of Ethereum, left unchanged by the hard fork. It lives on as a separate network with its own coin, ETC.
  • Ternovskiy: Andrey Ternovskiy, founder of the video chat Chatroulette and a major holder of DAO tokens. He later apologized to Vitalik for his threats to sue.
  • ERC-20: A common token standard on Ethereum. With it, exchanges and wallets understand a new coin right away.
  • ICO: Initial coin offering: a project sells its tokens to anyone who wants them in order to raise money for development.
  • Bancor: An Israeli token exchange project. Its ICO in June 2017 raised almost $153 million in three hours.
  • MyEtherWallet: A website for accessing your Ethereum wallet. It doesn’t store users’ keys: they are entered right on the site, which is why scammers made copies of it with similar addresses.
  • Parity: Gavin Wood’s company, first called Ethcore. It made software for running Ethereum and multisignature wallets.
  • Chan: Ming Chan, executive director of the Ethereum Foundation from 2015 to January 2018.

All terms

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