Ethereum founder Vitalik Buterin says the billions of dollars worth of doggy tokens he was sent caused a “very interesting and unexpected and insanely crazy situation” as he scrambled to sell them for charity.
Buterin, 28, had been sent roughly half the supply of the Shiba Inu, Akita Inu and Dogelon Mars meme coins by their creators, possibly as a way for the tokens to gain credibility through association with the Canadian-Russian billionaire.
Buterin made headlines last month when he sold the tokens and gave the proceeds to charity in an $80 million“rugpull” last month, but hadn’t publicly discussed the matter until Friday.
Speaking on Lex Fridman’s postcast, Buterin said the tokens’ creators had “dumped” the tokens into a cold wallet he couldn’t easily access. He was stuck in Singapore amid the coronavirus restrictions, while he had split the private key to the wallet into two pieces of paper at his family’s home in Canada.
“I saw these dog tokens and I saw more and more people talking about them, and at some point I realised these things are worth billions of dollars, and there’s lot of really good things you could do with that,” Buterin said.
Buterin said he decided to “power through” and sell the tokens, despite the hassle. He bought a new laptop from Target and had his family read him back the 80-digit numbers that, once added together, would allow him to access the cold wallet.
But once he had cracked open that cold wallet, for security’s sake Buterin needed to empty it — and the wallet contained 325,000 Ether, worth about A$1.2 billion.
Buterin said he worried that the new multi-signature wallet had a bug in it, or that he’d make some mistake in the transfer that would cost him all his Ethereum.
“That part was stressful. It was definitely stressing out for a few days and triple-checking the new wallet. I even did a bit of an audit of the code myself,” Buterin said.
There’s other people who are signatories to the new Gnosis wallet, Buterin said, declining to give other details.
The whole process, Buterin said, involved “all sorts of stuff that 10 years ago you would expect just to be part of a cyberpunk science fiction novel, but now it’s all real.”
But he did manage to sell about millions of dollars in tokens, funds he gave to charity. Buterin sent 13,292 Eth (worth about $67 million at the time) to Givewell, a charity assessment program; 1,000 Eth ($5.1 million) to the Methuselah Foundation, which researches life extension; and 500 Eth and billions of SHIB tokens to Crypto Relief, a charity set up to help India deal with its coronavirus crisis. The rest of the tokens he burned (destroyed).
Asked by Friedman if he had any regrets, Buterin said there was probably things he could have done better, but in talking with the charities he’s been impressed by how much money they were able to raise
“I probably could have done better by talking with some of the traders and actually ensuring that they could do a better job of maximizing the value of all of them, but it was a very stressful time and I did have to act quickly.
“Obviously there’s parallel universes in which I did better, but at the same time, there’s also lots of parallel universes where because I hesitated more and tried to spend more time thinking, I missed the opportunity.
“So on that it’s like luck of the draw, and I’m just happy that everything was able to turn out as well as it did.”
Buterin said for every dog-token holder who has been complaining that he destroyed the value of their meme coins, there’s been 10 others who are happy that their involvement in “a fun pyramid gambling thing” turned out to be helping the public good.
$4m profit on Dogecoin
Buterin also revealed that he had turned a roughly US$4 million profit on Dogecoin, funds he also donated to charity.
Buterin said he invested US$25,000 on the meme coin in 2014.
“And I just remember thinking to myself, OK, how am I going to explain to my mom that I just invested $25,000 into dog coins. What even are dog coins? It’s like the only interesting thing about this coin is that there’s a logo of a dog, somewhere, but of course that ends up being one of the best investments I ever made.”
Dogecoin skyrocketed in value at the beginning of this year, in part thanks to tweets from Elon Musk.
Buterin when Dogecoin pumped earlier this year, he called some of his friends, “told them to drop everything and scramble.”
They sold half his Dogecoins at US7c for $4.3 million, and felt like he was “such an amazing trader” as the price dropped back down again to 4c.
But then of course Dogecoin rose again, reaching as high as 70c in early May. It was trading for 37c this afternoon, making it the No. 6 crypto.
“Doge becoming this big phenomenon, where there’s even a lot of people that have heard of Doge that have not heard of Ethereum, is even something that I was not predicting,” he said.