Going Infinite: The Rise and Fall of a New Tycoon

by Michael Lewis

As it turned out, the people who set out to eliminate financial intermediaries simply created some new ones of their own, including, by early 2019, two hundred fifty-four crypto exchanges. These early crypto exchange founders weren’t typically financial experts. They were a grab bag of technologists and libertarians and idealists and high plains drifters, like Zane. Even more than, say, the New York Stock Exchange, the institutions they created required their customers to trust them. The New York Stock Exchange had regulators. If the New York Stock Exchange stole all your money, its executives would be sent to jail. In any case, the New York Stock Exchange would find it hard to steal all your money, as you didn’t keep your money on the New York Stock Exchange but in a brokerage account, managed by a bank, overseen by other regulators. The new crypto exchanges had no regulators. They acted as both exchange and custodian: they didn’t just enable you to buy bitcoin but also housed the bitcoin you’d bought. The whole thing was odd: these people joined together by their fear of trust erected a parallel financial system that required more trust from its users than did the traditional financial system.