Out of the Ether by Matthew Leising;

Out of the Ether by Matthew Leising;

Author:Matthew Leising; [Leising, Matthew]
Language: eng
Format: epub
ISBN: 9781119602941
Publisher: John Wiley & Sons, Inc. (trade)
Published: 2020-09-29T00:00:00+00:00


Part IV

The greatest trick the Devil ever pulled was convincing

the world he didn't exist.

– The Usual Suspects

Thirteen

Money had always been at the heart of Ethereum – it was Vitalik's original idea to create a programmable version of it, of course. Now several months into the project the Ethereum cofounders strained under the lack of hard currency coming in to fund development.

The crowdsale of ether had been planned for just two days after the Miami conference, but it had to be put on hold so that the legal issues around selling a security in the United States could be resolved. Then the crowdsale was put on hold again and again, and it seemed to many people working for the foundation that the payday would never come. The other obstacle they had to overcome was the security of the sale itself. Would they just open up a Bitcoin wallet and have people send them money? No, that wouldn't work. Hackers would love to get ahold of the Ethereum crowdsale Bitcoin. They needed a strong system – from the web site they'd use to the wallets where the Bitcoin they raised would be kept. All of that takes time.

“The team was really frustrated and running on fumes at that point,” Joe Lubin said. While Joe and Anthony Di Iorio had footed the vast majority of costs up to that point, “there were other people who contributed quite significantly in terms of paying rent and groceries and keeping shit going,” Joe said. “It was going on lots of people's credit cards and they weren't getting paid.”

One of the larger expenses was the house in Zug, which Gav called “The Mansion.” The monthly rent was 5,500 Swiss francs, which at the time equaled about $6,300. But the landlord of the newly built house wanted a year's worth of rent, plus a deposit, up front. That came to 82,500 Swiss francs, or just over $94,000.

“All the money was being fed to Switzerland and getting things set up there,” Anthony said. “You had people there who never had money before, and they didn't do a very good job.” Why did the project need a huge house with an elevator? The spending was getting out of hand, he thought.

“Back in Toronto we were trying to control things a little bit more,” Anthony said. And the project's ranks were swelling on an almost daily basis, it seemed. “They're bringing in all these new people. Listen, it was a free-for-all for new people to join, which led to a lot of chaos and lack of communication.” Nothing seemed to stay the same from one day to the next.

“There were a number of times where I wasn't going to keep funding the project,” Anthony said. “The company was in dire need of money and it was a pretty rough time when the markets went down.”

Bitcoin's value had continued in the doldrums in mid-2014 after the Mt. Gox hack was revealed in February. It traded for $400–500 for many months, off from its high of $1,000 in January, according to data on CoinMarketCap.



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