The Infinite Machine

by Camila Russo

Bitcoin was trading around $600 when he bought in, and the Argentine peso was at 6 per dollar. The peso has since slumped 90 percent to around 60 per dollar at the time of this writing,

Vitalik wrote the white paper in about two weeks and sent it to the Colored Coins Google group on November 13.

He had read about Bitcoin before, but it was with that video that he understood cryptocurrencies fomented political change by circumventing the establishment, rather than fighting it directly. This technology had an actual chance of rebalancing power in favor of the individual, he thought.

That week in Miami was one of only a handful of times the early Ethereum team gathered at the same place.

They hadn’t done two separate versions intentionally. It just happened that they both started working on Ethereum at roughly the same time without knowing or talking to each other. It turned out to be a good way to catch problems and come up with more efficient ways of doing things. It was also safer to have multiple clients in case one implementation got attacked; there would always be a backup.

One night they were all sitting on the floor, some of them smoking weed, and watching Enter the Void, an art movie about a French drug dealer living in Tokyo and his DMT-induced hallucinations.

Before Ethereum, almost any cryptocurrency project that had a premine would be quickly written off as a scam. Ethereum didn’t entirely change that, and it’s still criticized because of it, but it did help legitimize the concept.

Thousands of other people must have been thinking the same thing as they sent their bitcoin into what seemed like the dark void of the Ethereum sale. It’s hard to say exactly how many, but the blockchain shows more than 6,600 transactions going into EthSuisse’s Bitcoin address. The total number of people who participated is likely much smaller, though, as big buyers probably split their purchases into several different wallets.

The total supply of ETH started out at 72 million as 5.9 million (the stipulated 9.9 percent of the 60 million raised) was created for eighty-three early contributors and an equal amount was issued for the foundation. Vitalik got the biggest share of the contributors’ endowment at about 553,000 ether.

Research firm Chainalysis later confirmed the suspicion that ether distribution is concentrated. Only 376 holders control 33 percent of the circulating ether supply, a May 2019 report found5.

The plan was for Ethereum to go through five different stages—Olympic, Frontier, Homestead, Metropolis, and Serenity—over the course of the following year. By the time they got to Serenity, the network would have moved from energy intensive and wasteful proof-of-work into a different consensus mechanism called proof of stake,

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Separately, Joe and a friend of his set up a mining operation in response to a rumor that an astrophysics lab manager was going to mine empty blocks with tens of thousands of GPUs, which would have compromised the security of the network.

Some on the team, particularly Gavin and Aeron, were pushing to sell at least part of the bitcoin; that way they could make sure they had enough cash going forward. Others, like Joe, thought bitcoin would recover soon and that they would make more money by keeping the crowdsale funds in the digital currency. In the end, with Charles gone and so many people in charge of making decisions that nobody had the final say, almost none of the bitcoin was exchanged.

He read Ludwig von Mises’s laissez-faire magnum opus Human Action: A Treatise on Economics twice.

After designing the system and building the prototypes, Slock.it needed funding. The obvious option was a token sale. They coded up a crowdfunding contract, but then decided to take it a step further and created a smart contract that gave token holders the power to vote and decide what Slock.it should do with the funds. Still not happy, they took the concept even further, and created a true Decentralized Autonomous Organization, which would control the funds. This meant that token holders would decide where to allocate the money, and Slock.it would be just one among other proposals vying for it. It would effectively work like a decentralized venture fund.

As he tried to make sense of what was happening, Vitalik got a message from Gregory Maxwell, a prominent Bitcoin developer. He wanted to buy Vitalik’s coins on the old chain. With his offer, he was signaling his support for Ethereum Classic. Basically, he was “taking off his glove and slapping Vitalik across the face,” Emin said.