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Kindle Notes & Highlights
by
Ben Mezrich
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July 5 - July 30, 2020
Though Dante hadn’t written his most famous work in Latin, they’d both also studied enough Italian to play the game of updating the scenery in his inferno: watercoolers, fluorescent lights, whiteboards … lawyers. “Technically,” Tyler said. “We’re in limbo. He’s the one in purgatory. We didn’t do anything wrong.”
Antonio “Tony” Piazza
“You can be unethical and still be legal—that’s the way I live my life,”
Que fuerte
As Cameron learned, Zuckerberg was able to hack into McGinn’s email by exploiting the data in the Facebook database and violating the trust and privacy of his own users.
To Tyler, this wasn’t about money; this had never been about the money. As Zuckerberg had so delicately pointed out in the fake profile he’d made of Cameron,
After Facebook’s IPO, the twins’ $45 million in shares soared. It appreciated fifteen times and went on to be worth more than $500 million. If Quinn Emanuel had taken its fee in stock, the firm would have earned upward of $300 million for six months of work.
And it didn’t hurt that one of Obama’s campaign gurus was Chris Hughes, one of Zuckerberg’s roommates, who had run marketing and communications for Facebook prior to joining the Obama campaign.
To them, no matter where ideas came from or where companies built their fancy campuses, New York City was the financial engine of the world.
Almost three years after reading Satoshi’s white paper, Charlie was certain: it was going to change everything. And Charlie was going to ride that change right out of his mother’s basement and into history.
“You know a thing or two about social networks—and I know money. Money connects people. It’s a form of communication. And it’s about time that it truly went virtual.”
Although Tyler knew they were just scraping the surface—he didn’t yet know anything about this new currency beyond Azar’s pitch, nothing about what this technology really was, or what it might represent—he had come to a conclusion: either this Bitcoin was complete bullshit, or it was a really big deal.
“You get really rich,” he continued, with a Brooklyn car salesman’s grin, “by being the house.”
Martin Feldstein, former chief economic adviser to President Ronald Reagan and the real-life inspiration for the character of Mr. Burns on The Simpsons.
“To me,” Voorhees said, “the mystery surrounding Satoshi is a feature of Bitcoin, not a bug. The beauty of Bitcoin is that it is not built around Satoshi, it’s not built around anyone. To understand Bitcoin, you only need to understand Bitcoin.”
“Gravity doesn’t work because you believe in Isaac Newton.”
Winning was not what mattered: what mattered was that you gave your best effort and conducted yourself with the highest integrity and character. As Howard Sr. had always told his son: “I don’t care how many follow in my tracks, I just want to be the first person making footprints in the snow.”
fact, it had become a joke around the crypto community that if you bought your first bitcoin with a “red phone,” you were a real OG. The “red phone” referred to the ubiquitous phones that were present at MoneyGram locations.
Hence the name Mt. Gox, an acronym that stood for “Magic: The Gathering Online eXchange.” It was a clunky, janky, totally unregulated exchange.
ensure the security of their private key, they would have to harvest randomness from a sufficiently random and physical source that couldn’t be intercepted or easily reverse engineered.
gold: in 1933, President Roosevelt had signed executive order 6102, requiring citizens to turn in their gold for cash. It wasn’t until 1975,
when President Ford repealed this order, that it was again legal for Americans to own gold that wasn’t jewelry or coins. And all bank deposits were only insured to the tune of $250,000.
If this could happen in an EU country, what prevented it from happening anywhere else? This was precedent.
Two weeks later, he had been arrested in brutal fashion. Surrounded by men with drawn guns, taken down by DEA agents for selling pest control that the government classified as illegal explosives. Ver had sold around 200 of the devices; the company he’d bought them from had itself sold 800,000, without permits, and nobody had gotten arrested. The company that manufactured the device had sold millions, and again, nobody had gotten arrested. But Ver did get arrested, and when he went to jail, it wasn’t some cushy federal camp, it was a medium security institution, the real
Ver didn’t drink or do drugs, but he fully supported the rights of any individual to buy and sell whatever they wanted. And, Charlie believed, he also saw Bitcoin as the greatest way ever invented to bypass governmental organizations … like the DEA … or the IRS.
notice. Then dipping slightly, before exploding skyward four weeks ago—thank you, Cyprus—hitting an incredible high of $266 a bitcoin.
“I’m going to send you five bitcoin. All I want you to do is hold on to them as a token of our gratitude, for your time. One day they will be worth more than the cost of fuel for this flight.” Burkle smiled. “Do you have any idea how much fuel this bird burns?”
BTCKing was trying to evade those controls; on one single day, he’d attempted to purchase $4,000 worth of bitcoin, using a technique called “structuring.”
It was as if he had no interest in talking about the nuts and bolts of his own company. He was too busy playing the CEO of Bitcoin to be the CEO of BitInstant. And before Cameron or Tyler knew it, the meeting was over.
Mellon was a believer, but he was a believer cast in their image, not Ver’s or Voorhees’s. He knew that Bitcoin had to find its place within the financial framework that already existed. Facebook didn’t bring down the internet, it had just pushed the internet in a direction that worked for Facebook.
“Charlie, you smoke and drink at the conferences until you can barely see straight. You think that’s what Bitcoin needs right now? We’re here trying to make people see it as something legit.”
Thiel himself was, of course, a Valley legend, having founded PayPal, and was considered the “don” of the “PayPal Mafia”—a group of PayPal alums who’d gone on to start a slew of world-changing companies. The group included Elon Musk (Tesla, SpaceX), Reid Hoffman (LinkedIn), David Sacks (Yammer), Ken Howery (Founders Fund), Max Levchin (Yelp), and others.
“We started the evening with Gandhi. Let’s not end it with Che Guevara.”
And for the encore, economist and New York Times columnist Paul Krugman had written an op-ed titled “Bitcoin Is Evil,” after previously calling it the “Antisocial Network.”
The twins’ own research had shown that Silk Road did not dominate the Bitcoin market, as some breathless observers in the press had proclaimed. Silk Road was in truth a small fraction of the Bitcoin economy, even though it was the fodder for many juicy headlines. The brothers’ thesis was any drop in the price of bitcoin due to the Silk Road closure was sure to correct. And, of course, as far as the twins were concerned, the death of Silk Road was very good news for Bitcoin’s future legitimacy.
To actually revamp, he’d need new money transmission licenses, he’d need a new banking partner, and most of all, he’d need cash, lots of it, because he’d burned through everything the twins had given him, including the $500,000 bridge “loan” that had still never been paid back.
One in twenty startup investments succeeded, according to the numbers.
“Nobody is going to give you a license. This isn’t a game anymore. It’s fine to sit in Panama and gripe about the evil government, but in the U.S., if you don’t play by the rules, you end up in handcuffs. That’s the way this works. And that’s the way it’s supposed to work.”
It was their chief of staff, Beth Kurteson. Beth was a midwestern transplant who had come to New York City from Illinois for college and then later Columbia Business School for her master’s in business administration. She was the first person the twins had ever hired. She was smart, hardworking, and had extremely high integrity and emotional IQ. She had quickly become one of the twins’ most trusted and relied-upon team members.
“This is a combined arrest,” Officer Alford said. “Multiple agencies have been involved for some time.”
Bitcoin would never rise above the dark cloud of these early days, and the entire virtual currency industry might be doomed.
Technology did not prescribe to an ideology, it was agnostic.
The big money wasn’t interested in backing something dirty or illegal—not for moral reasons, but because those things weren’t good for business. It was what the twins had been saying all along.
“First, development of the open source community … a geeky, nerdy, crypto-libertarian thing, 2009 to 2010. Second—a vice phase. Silk Road, drug trafficking. Gun running. 2010 to 2011. Third phase, speculation, trading—we are getting to the end of that now—2013, 2014. Next phase is the transactional phase—real merchants accepting bitcoin. And the final phase is the phase of programmable money—when money can move via a programmable infrastructure.” Programmable money.
“When we first saw Bitcoin about a year and a half ago, I don’t think anyone would deny that it was a bit of a Wild Wild West, because there was no regulation, there was no framework to evaluate the assets, to evaluate companies, determine who was compliant, who was not. And a Wild West attracts cowboys.”
is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly;
“Bitcoin is freedom,” Tyler was saying to the assembled. “It’s very American.”
Serrin Turner, the assistant U.S. Attorney who had been the front man on the case since before Charlie had agreed to settle, and Turner’s various assistants.
Preet Bharara himself, the U.S. Attorney for the Southern District, the famous prosecutor who had taken down too many white-collar criminals and Wall Street bankers to count.
Correct—but still, Charlie believed, unfair. Because what he was doing—helping people get bitcoin—was, at its heart, something good, something that he believed was making the world a better place. Offering a form of freedom.
again, because he realized that for the first time since his arrest, he didn’t feel scared. He felt—relieved.
