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The curious twins who bet big on bitcoin
The Winklevoss twins may have lost out on Facebook, but they have won big on bitcoin.
When America's "favourite pair of oar-bearing, Lacoste-wearing, jealous twins" announced in 2011 that they were dropping their long-running court case against Mark Zuckerberg's Facebook, they seemed destined to become a colourful footnote in the group's history, says Wired. Immortalised in the film The Social Network as the "Winklevii", the Waspish Olympic oarsmen who claimed to be the rightful founders of Facebook were parodied in an episode of The Simpsons called The D'oh-cial Network and later appeared as a $1,600 question on the quiz show Jeopardy!
Then came bitcoin. Having spent $11m of their "meagre" original $65m settlement from Facebook buying around 100,000 coins (1% of the entire supply) in 2013 when the price was $120, the Winklevosses were this week hailed as the cryptocurrency's first billionaires, says The Daily Telegraph.
You might argue that Satoshi Nakamoto, bitcoin's mystery founder, got there first. But this is still "a landmark moment" for the cryptocurrency, which has soared by near-10,000% in four years, to hit a new high of more than $12,800 this week. For the twins, who are betting this is just the start, it might constitute a moment of sweet revenge. As Tyler Winklevoss put it last year: "We see bitcoin as potentially the greatest social network of all."
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The pair "bring an air of class to the bitcoin business", which they once described as "riddled with cowboys and opportunists", says Bitcoinist.com. When they launched their Gemini trading platform in 2015, said Tyler, "we wanted to build an exchange that was similar to Nasdaq or NYSE for digital currency. We wanted something that both Wall Street and Main Street felt comfortable with."
With new exchanges proliferating, the jury's out on whether Gemini will take that role. And their pursuit of a bitcoin exchange-traded fund is proving "elusive", thanks to wary regulators. Still, there's everything to play for. As The New Yorker put it: "The Winklevii aren't and shouldn't be easily written off as a pair of curious clowns."
Educated at Harvard, then at Christ Church Oxford, where they rowed in the Blue Boat, the Winklevosses "seem almost a parody of the Jazz Age sportsman", noted Vanity Fair in 2011. They stress that they aren't the privileged Ivy Leaguers they seem bigging up their roots in the Pennsylvanian coal mines. In fact, they're the privileged sons of a father who parlayed an accounting degree into a professorship at Wharton, then founded Winklevoss Technologies, an actuarial software firm that turned over $20m in 2011.
The twins grew up "upper class", splitting their time between a Greenwich estate and a Quogue beach house. But they've always had an eye for the possibilities of new technology, and an entrepreneurial bent. The seeds of Facebook were indeed sewn when they recruited Zuckerberg to work on their fledgling dating website Harvard Connection (aka ConnectU).
As the brothers tell it, they missed out on a fortune because of Zuckerberg's "sleight of hand" when devising their 2008 share settlement. But when Facebook floated in 2012, its value had already shot to $200m making it hard for the average American to get behind their spiel as the "wronged little guys". The twins claim they have no regrets about their fruitless "courtroom tussle" with Zuckerberg, says the FT.
They learned a lot from the speed with which Facebook evolved from a "fad" to a global phenomenon, and it encouraged them to bet on a similar trajectory for bitcoin. Zuckerberg has a net worth of $70.7bn, so the Winklevii have a lot of catching up to do. But $1bn is a start.
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