Epstein Files: How Jeffrey Epstein Had Ties to Bitcoin and Crypto’s Early Development

The latest set of Epstein files, which the Department of Justice (DOJ) released last week, showed the convicted sex offender’s ties to crypto as he backed crypto exchange Coinbase in an early funding round and Adam Back’s Blockstream. These files have also sparked comments in the crypto community, with Bitcoin advocate Jack Maller defending the Bitcoin network.

Esptein Files Reveal Investments In Coinbase and Blockstream

The DOJ files show that Jeffrey Epstein invested around $3 million in Coinbase’s series C funding round in 2014 through an entity called IGO Company, LLC. The Epstein files also showed correspondence that Brock Pierce, a former managing partner at Blockchain Capital, helped broker the deal.

However, a Blockchain Capital spokesperson told Decrypt that although Pierce was in contact with Epstein regarding the fundraising, they did not complete the fund investment, and that Epstein independently invested through his own entity, IGO Company. “We don’t have visibility into Mr. Epstein’s motivations for the Coinbase investment,” the representative added.

It is worth mentioning that Epstein was already a convicted sex offender prior to his investment in Coinbase. A Florida court convicted him in 2008 after he pleaded guilty to procuring a minor for prostitution.

Meanwhile, the Epstein files also showed that Brad Stephens, Blockchain Capital’s co-founder, contacted Epstein’s lawyer, Darren Indyke, in 2018 to inquire whether his client was interested in selling his position in the top crypto exchange for $15 million, which represented a 5x gain on the $3 million investment. At the time, Coinbase had a $1.6 billion valuation, up from the $400 million valuation when Epstein invested.

However, Indyke stated that Coinbase’s valuation was already above $3 billion, and proposed a fair offer of $11 million for 50% of Epstein’s Coinbase position.

Investment In Adam Back’s Blockstream

The Epstein files also included correspondence that indicated that the convicted sex offender had invested in Adam Back’s Blockstream through another investment fund. Blockstream is a blockchain firm that develops infrastructure on the top-layer 1 network, Bitcoin. In an X post, Back addressed this, noting that there was no direct connection between Esptein and his firm.

The Bitcoin advocate stated that during Blockstream’s seed-round investor roadshow, the company held a meeting with former MIT Media Lab director Joi Ito. This subsequently led to a meeting with Epstein, who Back noted was described at the time as a limited partner in Ito’s fund, which later invested a minority stake in Blockstream.

He further revealed that ito’s fund later divested its investment in Blockstream shares due to a potential conflict of interest and other concerns. “Blockstream has no direct nor indirect financial connection with Jeffrey Epstein, or his estate,” he added.

It is worth noting that the indirect investment in Back’s Blockstream isn’t the only tie that Epstein has to the early Bitcoin ecosystem. The Epstein files that the DOJ released last year showed that Epstein had sent Epstein sent $850,000 to MIT between 2002 and 2017. Part of these funds supported the MIT Digital Currency Initiative, which funded Bitcoin Core developers.

Meanwhile, Bitcoin advocate Jack Maller has defended the Bitcoin network, describing it as a “neutral, open-source public utility. He further remarked that BTC is not a person or institution and has no secrets. “Corrupt people do not get to rob humanity of our chance to fix the mess we inherited. Bitcoin is the solution, not the problem,” he added.