Winklevoss Twins Become First Bitcoin Billionaires With 2013 11M Bet
World's First Bitcoin Billionaires?
American twins, Tyler and Cameron Winklevoss, between their combined wealth, are the world's first Bitcoin Billionaires. The twins from New York are famous for suing Facebook's Mark Zuckerberg, claiming he stole their ‘ConnectU' idea to create the popular social networking site.
ConnectU (originally HarvardConnection) was a social networking website founded by the twins and Divya Narendra in December 2002 and launched on May 21, 2004. Users could add people as friends, send them messages, and update their personal profiles to notify friends about themselves. Users were placed in networks based upon the domain name associated with the email address they used for registration.
Sounds a lot like Facebook, right? Indeed, they walked away from the successful lawsuit against Zuckerberg with a $65 million settlement in 2004, and purchased roughly 100,000 bitcoins in March 2013.
The twins, who're also known as The Winklevii, are venture capitalists and entrepreneurs. In 2008, they rowed for the US at the Beijing Olympics, finishing sixth. There was even a film, The Social Network(2010), made out of their involvement in the creation of Facebook in which Armie Hammer played both of them.
Since their investment in Bitcoin, the crypto currency has surged 10,000%, which makes the speculative fiat valuation of their slice of the Bitcoin pie worth a billion. The brothers have not sold a single bitcoin they bought as they sat and watched it accrue value over time.
Earlier this year, they attempted to create an ETF for Bitcoin called Winklevoss Bitcoin Trust, but fell short after the U.S. Securities and Exchange Commission(SEC) rejected the application, citing the possibility of fraud. The SEC does not view Bitcoin or any crypto currency to bear any actual value. Had they been successful, it would have opened the door to institutional investing in the currency.
Back in 2013, the twins contributed $1.5 million in seed funding for a Bitcoin payment processor and exchange service, BitInstant. In July 2013, BitInstant suspended services, saying it wanted “to improve the code based on trends they noticed” in nearly 17,300 customer service complaints. A few days earlier, a class action lawsuit had been filed on behalf of customers, claiming failure to perform services and false representation.
The CEO of BitInstant, Charlie Shrem was arrested and charged with ‘conspiring to commit money laundering by selling bitcoins to users of the dark web' in January 2014. BitInstant has shut down since and the twins claimed they were only passive investors in the company.
In 2015, the twins launched another digital currency exchanger named Gemini. The exchange has begun operations in Canada and U.K.
Although the Winklevoss twins have reasons to rejoice on their successful crypto investments, they're a long way away from eclipsing their arch-nemesis, Zuckerberg, whose estimated valuation according to Forbes is in the region of $70 billion.