Inside the Messy, Dizzying Rise of Ethereum, With Author Laura Shin

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The Ethereum ecosystem now moves trillions of dollars around the world, rivaling Visa in the size of its asset transfers. It’s been the bedrock on which new types of finance (DeFi), digital goods (NFTs) and digital organizations (DAOs) are being built. Its size and speed have forced traditional behemoths, from governments, to tech companies to banks to scramble to keep up.

But just nine years ago, Ethereum was only a dream in the mind of a 19-year-old Russian-Canadian college student who slept on his friends’ futons and solved puzzles on long walks. So how did Ethereum spring from the mind of Vitalik Buterin and become the powerhouse it is today? The journalist Laura Shin’s new book, The Cryptopians: Idealism, Greed, Lies and the Making of the First Big Cryptocurrency Craze, tells the story over 400 pages. As a former Forbes editor and the current host of the podcast Unchained, Shin is particularly well placed to tell this story. She interviewed more than 200 people for the book, who showed her recordings, photos, chat conversations, emails, and other documents to give her an inside look into Ethereum’s epic, messy rise.

I spoke to Shin over Zoom, and discussed her process—and what she hopes the book reveals about Ethereum’s history. The Cryptopians (Public Affairs) is out on Feb. 22.

Finding Vitalik

While The Cryptopians gets very technical at some points, it also resembles something like a rock band biography, in which egos clash, decadence flows, and small dreams spiral out of control. And the main character is crypto’s frontman: Vitalik Buterin. Now 28, Buterin is one of the most fascinating characters in the cryptocurrency space: a coding savant and deep conceptual thinker whose vast technical prowess is sometimes offset by social awkwardness and aversion to confrontation. Shin has interviewed Buterin several times, and says she hoped to show a “human side of Vitalik that hasn’t been seen before.” The book explores his childhood—at 7, he wrote a dense encyclopedia about bunnies—his social discomfort at early Ethereum conferences, and his standoffish, consensus-seeking approach to wave after wave of unfolding crises.

“I really felt like the book was a kind of coming of age story for him,” Shin says. “I think I was able to get more about what was going on in his head, and what people around him were thinking than other people. And Vitalik not having the kind of personality to really assert himself is kind of a big problem throughout the book.”

Deep into the DAO hack

In 2016, a hacker swiped $60 million worth of Ether from the DAO, a blockchain-based venture capital firm that was supposed to revolutionize funding mechanisms. The hack sent the Ethereum community into a civil war about how to handle the breach. Shin spends about 70 pages charting the frantic efforts by multiple parties to reverse the damage, as well as the fierce internal and public debates happening on Reddit, Slack and other platforms.

“It’s definitely the longest saga in the book. Any normal person who’s not a crypto person would look at that and say, ‘That’s a theft,’” Shin says. “But in crypto, they were so wrapped in the code that it became this philosophical question for them. They don’t want human intervention: They want the blockchains to just be these autonomous things.”

Eventually, following advocacy from Buterin and others, the Ethereum network chose to “hard fork”—an intervention process that essentially rolled back the network’s history as if the hack had never happened.

The identity of the hacker was never revealed. But now, Shin says she followed a trail of forensics reports, node names, IP addresses, and other pieces of evidence to a person who lives in Singapore, and is preparing to disclose the identity publicly.

Developers vs. moneymen

A major narrative theme in The Cryptopians lies in the power struggle between developers, who wrote blockchain code and forged its rules, and businesspeople, who funded their work and interfaced with the world. According to Shin, the business leaders of Ethereum (like Charles Hoskinson) thought the devs (like Gavin Wood) were naive and narrow-minded, while the devs didn’t understand the purpose of the moneymen. Buterin, for example, is quoted as calling venture capitalists a bunch of “snakes.”

This ideological warfare came to a head in what became known as “Game of Thrones Day,” a 2014 fight between the Ethereum inner circle in Zug, Switzerland that led to the axing of two businessmen (Hoskinson and Amir Chetrit) from the leadership group. Shin narrates this story with minute-by-minute detail, with each of the members sniping at each other. She says that dynamic, and the result of the devs winning, would play out over and over again in the coming years of cryptocurrency. “In a way, it might already be decided: A lot of the big leaders of these different protocols are just the devs,” she says. “There aren’t business leaders calling the shots: it’s decentralized, democratized, and there’s voting.”

Ethereum’s villains

The Cryptopians is less than flattering to several key members of the Ethereum ecosystem’s history. Joe Lubin, an Ethereum co-founder and the founder of the blockchain company ConsenSys, is described with disdain by several ConsenSys staff members, including one who accused him of “mask[ing] his old-school, power-hungry, dominate-and-crush ways with ‘A love and light’ story of decentralization and mutual empowerment, to which he only paid lip service.” (Lubin refutes this, and many other claims, in Shin’s book.)

Ming Chan, who served as the Ethereum Foundation’s Chief Executive Director, is portrayed as manipulative and conniving. (Shin says she emailed Ming 11 times for an interview and never secured one.) The leadership team of cryptocurrency exchange Poloniex is characterized by several former employees in the book as being wholly dysfunctional. While the blockchain was supposed to protect people from the whims of untrustworthy leaders, Shin’s book shows, perhaps unsurprisingly, that human flaws still ran rampant during the rise of the technology.

“I didn’t have an agenda when I wrote the book: I wrote what people told me, and gave everyone a chance to respond,” Shin says. “This is a really important moment in history, and I want people to know 100 years from now what actually happened. I’m not going to try to sugarcoat things to protect anyone’s ego.”

Setting the stage for the 2021 boom

The Cryptopians only tells the story of Ethereum through the beginning of 2018. Since then, its price has more than tripled, and Ethereum has become the network underlying most of the astonishing advancements in crypto. While The Cryptopians tells the story of many disasters, Shin hopes people will come away from the book also understanding Ethereum’s positive impacts. “There’s very promising technology here, and that’s why all of it has taken off and survived, and is now the basis of this huge blockchain,” Shin says. “All the major trends in crypto have been on Ethereum: ICO, Defi, NFTs, DAOs. So yes, the foundation was messy. But does that detract from what it’s achieved? In my opinion, no.”

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