On the Origins of Ethereum

I was reading this post by Vitalik a few days ago, and felt a need to share a few important points of my own experience on the origins of Ethereum:

> Crypto is building toward human empowerment, as it has been since the beginning

“Empowerment” was the code of the philosophy of the Pirate Party, before crypto even existed. https://t.co/3jGzyouVu7 pic.twitter.com/3keGzBxVYJ

— vitalik.eth (@VitalikButerin) December 20, 2025

On a flight many years ago, I happened to sit next to one of the many cofounders of Ethereum. I won’t reveal his name here out of respect for his privacy, as he is an extremely privacy-conscious person. We talked Ethereum and Bitcoin during the flight, agreeing and disagreeing about various issues in the space. I’d been personally invested in Bitcoin for years, and at the time was building Casa, a security system and service for Bitcoin.

At the end of the flight, he said to me “sometimes I struggle with the idea that I created a penny-stock machine.”

The admission shocked me. Still does. I deeply respected him and still do for his line of thinking and open truthful discussion.

I still don’t know if he was speaking about penny-stock machine design from the beginning, or a realization of what Ethereum had become despite some early designs intending it to be something else. But the open admission and guilty tone, on my read, signaled the former.

I invested in Bitcoin earlier than many people, but later than many others. I had a chance to invest in the Ethereum premine and I did not. I remember staring at the presale/premine screen in 2014, but there was and still is one point that I could never get over, which is that by design Ethereum can function as a “world computer” even if the price of Eth stays at $1 or relatively flat. That hasn’t changed. Yes, it is true that changes to the protocol could change the monetary dynamics to drive higher price points, but by founding frame that also means it could be changed back and the price could crash if those dynamics are removed. Unpredictable protocol dynamics are baked into Ethereum from the beginning. Because of that, there is and always will be an air of uncertainty with Ethereum that can never exist with Bitcoin because Bitcoin started under much more goal-defined and transparent conditions.

Bitcoin, comparatively, by design will not survive unless the price goes up, and further, unless it maintains it’s original stated project goals. I know that some currently think that because of the growth of ETFs, paper Bitcoin may cause the underlying 21 million limited coins to not appreciate in price as fast or at all. This is not true. Instead, the whipsaw of the Bitcoin price spike will be even bigger once it finally happens. There are a number of reasons why this will happen, but one of the key ones is geopolitical uncertainty or collapse. In the event of a collapse, and the attempted redemption of paper Bitcoin for physical onchain Bitcoin (assuming the Bitcoin network survives any collapse event), there won’t be enough Bitcoin to match the paper claims needed. At that moment, the price will spike far beyond the price of even the best cases that people are considering.

This isn’t to say that Ethereum doesn’t have some value, or can’t find a path to creating stable longterm value at certain price points for certain periods of time. But I always feel a need to speak up anytime I hear statements about Ethereum’s “beginning”, when I have so many points of evidence showing that the beginning was far more strange and layered and (it seems) simply financially pump-and-dump motivated than what is currently told. I’ve spoken of these stories privately with many people, and this is the first time that I’m writing of them publicly.

I’ve never met Vitalik, though I have friends who have spent time with him and speak highly of him. Vitalik seems very well intentioned, and this post is not meant to overly critique him. I am not suggesting that he is lying. Vitalik may have been and may still be a true believer on the limitless potential of Ethereum, and it could have been other cofounders that viewed the project as a penny-stock machine. Vitalik’s future actions and words will tell us which one it is.

But I’ve never been able to get that moment of meeting the other cofounder out of my head when engaging with the project or the teams. The shape of Ethereum’s growth with foundations and conferences and whitepaper hype makes a lot more sense in light of the cofounder’s admission to me, than does the alternate history of “human empowerment” from the beginning.

I’m not immune from criticism I am raising here – both around the complex shifting narratives with founding process or around many of the potentially utopian claims with cryptocurrency, as I actively worked in the ecosystem for a longtime, both as founder/CEO of an application and then security infrastructure company (Casa, which started as homesharing company Bedkin), and also as the CPO at a cryptocurrency exchange (Kraken). I always tried to stick closely to the deepest real problem-solving claims for the technology, and I do still believe that Bitcoin and other cryptocurrencies enable better monetary freedom than the use of state fiat currencies alone, especially because of the blockchain technology at the core of all of them.

This line of thinking is one of the reasons that I anchored my earliest foray into the cryptocurrency space with Casa under the theme “less whitepaper hype, more working code”, with working code on top of the Blockstack project. What started as a “homesharing-on-Blockstack” application project transformed into an infrastructure company after running into challenges building full applications, with what I considered to be the best application-enabling cryptocurrency stack at the time. I pivoted the company to work on the two areas that we saw as the greatest bottlenecks to true applications: node management and cryptographic key management. These still remain as challenging problems years later, and I continue to advise the Casa team as cofounder despite no longer serving as CEO there (Due to a family health issue, I stepped back voluntarily from leadership in 2020 and carefully crafted the next phase of growth and team to make sure that the company survived the shift. Couldn’t have done it without the hard work of Nick and Jameson and the rest of the Casa team, despite some headwinds we faced from some investors when I notified them of the planned transition.).

I’ve long held the view, first articulated when leading Casa as CEO, of “Bitcoin-first.” That’s because if Bitcoin fails, everything else fails. Ethereum and all other cryptocurrency projects, even if they fail for periods of time, can still survive because of the proven resiliency of the Bitcoin project (both technically and reputationally). This view enabled us to (while still prioritizing Bitcoin) test and consider supporting many other currencies, including Ethereum and Monero in earliest key management tests, and Blockstack and Litecoin in our earliest node tests.

There are many ways to make easy money in a world of programmable money printers. The much harder way to make money is by solving more challenging problems, which customers and other businesses will pay for. At minimum, we all should be striving for the latter.

But focusing only on money-making, whether via money printing or via problem solution, will prevent us from ever solving the most challenging problems in front of us. The biggest problems will not be easily monetizable on the short term, and some of them may never be monetizable.

If we try to put money at the center of everything in our lives and our cultural practices, regardless of whether it is programmable, cryptographically-provable electronic money or old coins, we will fail to not only solve the greatest problems in front of us, but also to become our best selves.

Money can only abstract value that already exists. Focusing on solving problems, instead of just money and money printers, will get us to a more resilient world and better lives for our generation and generations to come.