The O.G., the Lawyer, and the Porn Addict — The Players Behind the Ethereum Domain Auctions
Over the last 3 weeks I’ve been in financial combat with centimillionaires, idealists, hackers, Wall Street traders, extortionists, porn addicts and lawyers from all around the world. Welcome to the Ethereum domain auctions, which are little more than halfway finished.
Like many others, I believe Ethereum — a programmable cryptocurrency that can be harnessed to write smart contracts that do everything from clear and trade securities, automatically pay your bills, sell property, share or protect data, or control anything that can respond to code — is going to become effectively the operating system of money. Bitcoin may have pointed the way to the future, but Ethereum will be the foundation. And right now the computer scientists and programmers who are developing Ethereum are auctioning off its domain naming rights. Just as having the right .com address can be worth big bucks, the thought is, so will be having the right .eth address. The great landgrab has started, and I’ve been busy bidding.
I don’t want to get into all the mechanics of the auctions other than to say that it is an arcane, difficult process intended to assure fairness. Unfortunately, it also is a messy, jury-rigged sealed bid process that unintentionally keeps the normals away. Only a few thousand different accounts (and a person could have multiple accounts — I, for instance, use two) have signed up for the bidding, but the landscape has been dominated by just a few.
Since transactions on the Ethereum blockchain are public, with a little research you can learn every detail of the bids. In most cases, you also can unveil a lot about the bidders themselves. At 60% of the way through the auction process and with 125,000 names already auctioned, here is a tour of some of the biggest players and their stats. All $ statistics were calculated with Ether = $260. (Editor’s note — it has since moved up to $334 in just two days since I wrote this. The feeding frenzy is on! Jack up all quoted prices in $s accordingly.)
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#1 “The O.G.”
31 Domains Purchased
$10,324,860 Committed ETH (in $s)
$47,706,137 “Dry Powder” remaining in Wallet
Most Expensive 5 Domains: darkmarket; openmarket; tickets; payment; messenger
The O.G. is simply the biggest whale there is — he NEVER loses on a bid, because he is willing to make incomprehensibly huge blind bids to assure himself of winning. Why the name “O.G.”? Because he is one of the original gangsters in Ethereum. He was there at the genesis, undoubtedly one of the founding programmers who picked up a boatload of Ether when it was valued in pennies, not the $260 per token it is today. And the O.G. isn’t only into Ethereum — he has converted his ether into other new crypto-tokens like Golem. How overpowering is his bidding? Well, he bid 58,887 ether — over $15 million — for the rights to remittance. Next best bid — 1.23 Ether. He overwhelms the opposition.
Just as the original bitcoiners often are fervent libertarians, the O.G. seems intrigued by not only the standard big money terms and concepts (besides payment, messenger, tickets, he also owns stockexchange, investor, digital-currency, remittance, swissfranc), but also the unsupervised, Wild West aspect of cryptocurrency. Hence the owning of darkmarket, silkroad, assassin, and most intriguingly to me, shadowbrokers, the name of the group which leaked malware hacked from the NSA last summer.
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#2 “The Chinese Student Hacker”
144 Domains Purchased
$4,895,300 Committed ETH (in $s)
$383,031 “Dry Powder” remaining in Wallet
Most Expensive 5 Domains: network; wallet; gambling; contracts; lending
Why do I suspect this bidder to be a Chinese student? Well, just as you can tell a lot by a person by perusing their books and record collection, I’m looking at the names he’s bought. Student? He’s picked up university, science, college, teaching, universitystudy; and waterloo, as in the University of Waterloo, renowned for its CS program and next door to Toronto, which is Ground Zero for where Ethereum was developed.
Chinese-related words include caijing, zhongchau, qingdao, ethchina, chinese, as well as some lucky and unlucky numbers. One of the domains he owns is pornhub, for which he outbid 70 others. Another domain he owns also is the handle of his twitter account; he’s never tweeted on it, and only two people follow him, but his account follows 50 other Twitter accounts — the majority of which are…wait for it… Chinese porn. And he clearly is involved in cryptocurrency mining. He also appears to be a miner (he does own bitminer and hackers, and “miner” is the pseudonym shown on his Twitter account), and like some of the others here, he was involved in the very first bitcoin “Genesis” block.
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#3 “The LA Lawyer”
108 Domains Purchased
$2,640,560 Committed ETH (in $s)
$2,536,867 “Dry Powder” remaining in Wallet
Most Expensive 5 Domains: insurance, banking, currency, entertainment, betting
Do you know anyone who plays for bigger stakes and is more opportunistic than a class actions lawyer? Well, that’s what our next player is, as the managing partner of a law firm specializing in class actions and…yes, virtual currencies. While clearly a hard-nosed businessman, the Lawyer also is ethical, as seen through his writings about cyber-squatting and his refusal to go after such names. Rather than squat on corporate names like “Starbucks” for greenmail, he has spent big for the best set of non-trademarked domain names imaginable for smart contracts using Ethereum: insurance, banking, betting, etc. His LA roots show through (entertainment), as does his firm’s involvement in real estate (mortgage, realestate, apartment). Nonetheless, his portfolio of domain names is varied, from alcohol to careers to testing to ratings to etherpay. While very establishment, he definitely has a mistrust for all things government, owning disruptwashington, verified, fakenews, encrypted, trustedsources, and nottrusted. It’s strange that even with his combination of sophistication and distrust that his identity is so easily revealed: he bought up all of his family’s names as domains and keeps them in the same digital wallet as all of his other activity. Jeffrey, tighten it up next time! While the Lawyer has won some incredible domains and has a whopping big bankroll, he, like everyone else, didn’t stand a chance when he went up against the O.G. bidding for tickets and payment.
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# 4 “The Gambler”
17 Domains Purchased
$1,755,260 Committed ETH (in $s)
$1,698,447 “Dry Powder” remaining in Wallet
Most Expensive 5 Domains: blackjack; affiliate; 88888888; onlinepoker; mycasino
This guy is a specialist: he’s selective with his names, and almost all apply to gamblers or lucky numbers.
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#5 “2Bids”
1 Domain Purchased
$1,731,600 Committed ETH (in $s)
$9,465,731 “Dry Powder” remaining in Wallet
Only Domain: exchange
Under the Vickrey auction rules used in the Ethereum domain auctions, it is the runner-up bid, also known as the cover bid, that establishes the price that is paid by the winner. So, if you bid 12 on something and I am the next best bidder at 7, once the auction is done, you are refunded the difference between 12 and 7, and 7 becomes the effective price. 2Bids has only bid twice: losing out to The Gambler on blackjack, and then overwhelmingly winning on exchange, bidding initially $3.3 million before the price settled at the cover bid of $1.73 million. He is sitting on the biggest stack around other than the O.G. In the meantime, while waiting for the next name he wants to come up for auction, 2Bids has, for him, a casual small $260,000 sidebet on an ambitious new cryptocurrency project, Aragon. Expect more fireworks from him later when the prime 4- and 5-letter names are auctioned. ========================================
#6 “The CoFounder”
This auction bidder is easy to guess— it must be Gavin Wood, the co-founder (along with Vitalik Buterin) of Ethereum. Gavin has registered few, but quality, names. It is safe to say that he owns much more Ether than he is showing in the wallet used below, and more than enough to make sure he beat out squatters bidding on gavinwood.eth. It’s nice to see that his attention is based on building things of more lasting value than just amassing a collection of .eth domain names.
7 Domains Purchased
$664,300 Committed ETH (in $s)
$253,678 “Dry Powder” remaining in Wallet
Most Expensive 5 Domains: capital; property; crowdfund; tokensale; gavinwood
The real question is, “what kind of person would bid against someone like Gavin looking to acquire their own name?” In this particular case, the answer is a scummy squatter like this jerk, who while only having 5 Ether to spend, has registered 99 names, squatting on various derivations and misspellings of JPMorganChase, Samsung, Verizon, Hewlett-Packard, Comcast, Walmart, Coca-Cola and any big company which he thinks he can extort. As well as high-profile personalities.
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#7 “Mr. Identity”
10 Domains Purchased
$490,100 Committed ETH (in $s)
$18,201 “Dry Powder” remaining in Wallet
Most Expensive 5 Domains: identity; dropbox; ycombinator; huffingtonpost; manulife
90% of the money spent by this bidder is on one domain: identity.eth. Indeed, the concept of a secure, verified, yet encrypted identity information is almost a holy grail of developers. The goal is verifying and storing all of your info in the blockchain, whether that be your medical records, financial information or Social Security Number, and keeping that data private and encrypted except when you specifically choose to release it. As for the other domain names owned, there seems to be a hint of Silicon Valley unicorn here (ycombinator, and one of its most successful graduates, dropbox), but little else to go on. It is fitting that someone who is bidding on identity is protective enough of their own to have little information discernible.
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#8 “The Chinese Dev Shop”
2 Domains Purchased
$364,260 Committed ETH (in $s)
$303,218 “Dry Powder” remaining in Wallet
Most Expensive Domains: imtoken; consenlabs
This bidder holds just 2 names: imtoken and consenlabs. Both of those names can be found on this one website, if you can translate from the Chinese. Consen Labs is out of Hangzhou, and is a dev shop that previously worked on Ruby on Rails applications before turning their attention to the blockchain. They now focus on digital asset management apps and exchanges. They have only bid on a few other domain names, including being the runner-up on identity. The Chinese Dev Shop also is developing applications for the BAT, the Basic Attention Token, which brings blockchain technology into adtech.
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#9 “The Big Fat Corporate Squatter”
159 Domains Purchased
$371,800 Committed ETH (in $s)
$5,280 “Dry Powder” remaining in Wallet
Most Expensive 5 Domains: AmericanExpress; CapitalOne; Nationwide; LockheedMartin; MetLife
While we saw an example above of the low-budget squatter who was going after cheap derivatives and typos of brand names and individuals, here’s the first big bucks example of someone doing wrong by doing it right. The Big Fat Corporate Squatter has focused on well-heeled (mostly financial) corporations and has spent big to get pristine names. The Big Fat Corporate Squatter owns almost no descriptive names, like “banking” or “financial services” which can have legitimate usage, but instead only pursues well-known corporate trademarks. While the BFCS has little money left in his wallet, at this point he is still in the top 10 on funds spent for domain registrations.
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Some other behind the scenes stories of interest
The Perpetual Runnerup:
5 Domains Purchased
$45.14 Committed ETH (in $s)
$2,154,428 “Dry Powder” remaining in Wallet
Most Expensive 5 Domains: options; cricket; downloads; drugsmarket; dnslink
One brave soul stepped up and bet huge on DarkMarket and OpenMarket. But he didn’t know that the O.G. had targeted those same names. Because the auction process charges 0.5% of your bid as an earnest fee, the Perpetual Runnerup quickly dropped $39,000 worth of ether making his massive but ill-fated bids. The moral: tangle with the O.G. at your own risk. He did pick up 5 other domain for a little under $12 grand, giving him the strange distinction of losing 3x more money on fees making 2 bad bids than he actually ended up spending on five real domains. Not that he cares. He was one of those people involved two years ago on the ground floor, and he still has a cool $2.1 million in available Ether sitting in his wallet.
While Perpetual Runnerup missed DarkMarket, he scored drugsmarket. No further commentary necessary.
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“The Savvy Frenchman”
116 Domains Purchased
$382 Committed ETH (in $s)
$8948 “Dry Powder” remaining in Wallet
Most Expensive 5 Domains: remboursement; informatique; placements; propriete; bourses
The master of language arbitrage. Know all those names that are trading for thousands of Ether? He’s picking up the same word en francais for next to nothing.
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“The Squatbots”
These bots are programmed to buy whatever seems to be close to comprehensible in English at a tiny price, with the overwhelming amount of their purchases happening at the minimum bid. They are the true bottom feeders, but every now and then snag a good name that got missed by the other bidders. Here’s the stats on just on a typical one, but there are several more like it.
3443 Domains Purchased
$9854 Committed ETH (in $s)
$5875 “Dry Powder” remaining in Wallet
Most Expensive 5 Domains: none go for more than $5.
A specialist variation is the PornBot, which holds domains I can’t even begin to imagine, and I have a very good imagination. Programmable deviancy. Excuse me if I don’t list some of their holdings, I’d be embarrassed.
And there you have it. For a more traditional look at the ENS auctions and why some compare the auctions to buying a bank CD, see The Token Report. As public awareness of the auctions comes out, we’ve seen about 1500 more bidders starting each week. But no matter how many new players join the fun, one thing will remain the same — no one beats the O.G.
