The Cryptopians
The Ethereum world and token economics FTX was built to trade.
Summary
Shin, a cryptocurrency journalist, wrote the history of Ethereum's founding and early years, based on extensive interviews with the founders and on documents.
The narrative covers Vitalik Buterin's proposal for a blockchain with a general-purpose programming capability rather than a payment ledger alone; the assembly of eight co-founders with very different objectives; the 2014 Miami meeting where the group decided against structuring as a for-profit company; the crowdsale that raised funds in bitcoin; the establishment of the Ethereum Foundation in Switzerland; and the repeated internal conflicts that removed several founders, particularly Charles Hoskinson.
The central technical and governance episode is the DAO. A decentralised investment vehicle built on Ethereum raised a very large sum and was then drained through a flaw in its smart contract code. The community faced a choice between accepting the loss, which the principle that code is law required, and rewriting the chain's history to reverse it. The decision to fork produced Ethereum as it now exists and Ethereum Classic as the chain that refused. Shin argues this episode established that the system was governed by people rather than by code, which contradicted its founding claim.
She also reports her own investigation identifying a person she believes carried out the attack, which the named individual denies.
The book is reported journalism about a community that produces a great deal of self-serving narrative, and Shin is careful with sourcing. It is more concerned with personalities and disputes than with the technology or the economics, so readers wanting to understand what Ethereum does technically will need other sources. It ends before the transition to proof of stake.
Key takeaways 7
- Ethereum was proposed as a general-purpose programmable blockchain rather than as a payment system, which is the distinction from bitcoin.
- The founders chose a non-profit foundation over a company, which shaped both the funding and the subsequent governance disputes.
- Eight co-founders with incompatible objectives produced conflicts that removed several of them within the first year.
- The DAO exploit used a flaw in smart contract code rather than any weakness in the underlying blockchain.
- Reversing the DAO loss required rewriting chain history, which established that people rather than code govern the system.
- The fork created Ethereum Classic as the chain of those who held that code must be law regardless of outcome.
- A crowdsale conducted before any product existed created obligations and expectations the founders had not defined.
Who should read it
Investors and technologists in this sector who want the documented account of Ethereum's founding and the governance question the DAO fork settled.
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