Ripple’s Chief Technology Officer (CTO), David Schwartz, has recently shared how he obtained 40,000 Ethereum (ETH) tokens during its initial coin offering (ICO). This revelation was made in response to a community member’s inquiry about Schwartz’s initial involvement with Ethereum prior to the public pre-ICO. It all began when Schwartz sold 40,000 units of Ethereum assets for $1 per ETH in order to finance solar panels for a house he has since sold. However, he now reflects on this decision as the value of Ethereum skyrocketed by 1,000% shortly after he sold his holdings.
In response to the inquiry, Schwartz clarified that his participation in the Ethereum ICO was not solely a business decision, but also a personal one. He explained that he was invited to participate by Vitalik Buterin, one of Ethereum’s founders and a close friend. Schwartz wanted to support Buterin, so he sent 20 BTC without asking for many details. As a result, he received 40,000 ETH in return.
Public records confirm Schwartz’s account. The Ethereum ICO took place over 42 days between July and September 2014. Early investors could acquire 2,000 ETH for 1 BTC or $0.31. However, as the ICO progressed, the exchange rate of ETH to BTC increased, and by the end of the token sale, 1 BTC could purchase 1,337 ETH. The Ethereum team announced the ICO at the North American Bitcoin Conference in Miami in early 2014, and their fundraising approach was considered innovative at the time.
Schwartz sold his 40,000 ETH tokens for approximately $12,400 when their value reached $40,000, resulting in a 222.58% return on investment after a two-year holding period. However, had he held onto his investment for just one more year, he would have seen an incredible gain of 32,158%. This would have turned his initial $12,400 ETH portfolio into $4,000,000.
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