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Brian Armstrong seeking cofounder on HN (2012)

281 points by swyx 6y ago

BelenusMordred 6y ago
Some of the comments in this are great: > Transferring bitcoin funds is already easy with the GUI. Sure a wrapper around it might make it slightly more user friendly but it's trivially easy to implement. Not to mention the fact that Bitcoin is illegal in most developed countries. > I don't think alternative currencies have a long-term future. The only reason they exist now is because people and governments in most countries are quite ignorant about technology. Once they become more widely used, they will start causing a whole lot of problems* and will be banned by governments. > Did you invest in Bitcoin when it was $21, and want to bring that price back up?
- cblconfederate 6y ago
  Versions of the same comments could be made even today. It's a great company with a bright future, and their own cut of the pie is guaranteed, but there are excellent exchanges outside US
  - arthur_sav 6y ago
    I live outside the US and still use Coinbase because they have created an image of trust, and so far they deliver on that. Personally i don't care if they're not the cheapest as long as they don't screw me when i need them the most.
    - jkhdigital 6y ago
      Exactly, Coinbase actually seems to give a shit about the customer relationship, something which is virtually nonexistent in the crypto space. Case in point: for a long time they covered all network fees when withdrawing from Coinbase Pro, while most exchanges charged a flat rate which inevitably was abused as a profit source.
      - deleted 6y ago
        [deleted]
    - cblconfederate 6y ago
      Coinbase will one day become a crypto bank, but right now the role of exchanges is minimal, on/offramps and being the wallet for a lot of people. I don't think they re much different than binance. They re more trusted because as an american company they are considered more protected, but that's not something they achieved, it's afforded to them by the fact that they're american.
      - arthur_sav 6y ago
        The reason i trust them is the people, the work and not the location. Coinbase is backed by respected investors, the founder is well known and they seem to be in for the long run. Security wise, they have implemented many counter measures to prevent funds being stolen and so far i haven't heard of any breaches. They can handle large sums of money with no issues. So to sum up, they don't do sloppy work and the founder won't mysteriously disappear with the funds.
headsupftw 6y ago
So did he find a cofounder on HN? I actually met a cofounder of Coinbase on an airplane and he emailed me on the spot a cup of coffee in BTC. Let's just say it has turned into dozens and dozens of cups of coffee by now.
- shawabawa3 6y ago
  He found his co founder on Reddit in the end Brian used to give everyone he met who didn't have bitcoin $10 worth so I guess that was who you met
throwaway10110 6y ago
That is just awesome, I go into bitcoin in 2011 or 2012 (in top few hundred users on bitcoin-otc back when price was $4 a pop) and had loads of ideas for services (+ accepted bitcoin for years for webhosting) but listened to all negative comments about crypto and spend most of them over years (have a descent stash left) and hence now not a billionaire just a millionaire, but yeh moral of story is not to listen to overly critical nerds who are overly negative about every subject (often just to be edgy/cynical) and just do it!
- midasuni 6y ago
  For every example like this, how many are there of people failing?
  - Isn0gud 6y ago
    Yeah, if you know the future, just play the lottery, its much quicker!
  - seriousquestion 6y ago
    Unknown. But we do know that you miss 100% of the shots you don't take.
    - midasuni 6y ago
      You miss 100% of the shots you can’t take because of the high risk play.
- sumedh 6y ago
  Even if HN would was more pro BTC back in the day you and most others would have sold a majority of BTC when the price started crashing from the 20K USD peak
  - hmmokidk 6y ago
    I struggle with this. How do you know when to sell for good? I suppose it is when you predict opinion is going to work against this and public opinion seems a very slow moving thing. Unless some sort of crazy event occurs.
cblconfederate 6y ago
Moral of the story is, he didn't find one. It's impressive how transparent he was. But maybe he did not use the current-month's favourite javascript metatranscompiler
- rawtxapp 6y ago
  He didn't find one on HN (which is famously anti-crypto), he found his co-founder (Fred Ehrsam) through reddit.
  - spottybanana 6y ago
    Wonder if he had any posts on reddit that have stayed there?
  - jahn716 6y ago
    it is shockingly not very pro crypto, huh?
  - beefield 6y ago
    > which is famously anti-crypto The threshold to being famously anti-crypto seems to be quite low. Like, not everyone being completely uncritically positive about crypto.
  - mustafa_pasi 6y ago
    In 2012 HN was not so pessimistic about crypto.
deleted 6y ago
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sagolikasoppor 6y ago
Cool unfortunately I was too young and inexperienced at that time. Coinbase is a great service.
practicalpants 6y ago
Intriguing that the motivation for coinbase was: "Credit card fees are too high. In the next five years merchants are going to start moving away from..." I think it's fair to say he was actually wrong. But succeeded nonetheless because everyone now wants to get rich speculating on cryptos, which is the dominant reason they are so popular.
- deleted 6y ago
  [deleted]
- xur17 6y ago
  I honestly think stablecoins on a layer 2 network have a good shot assuming merchants find a good way to incentivize it over credit cards.
FlyingSnake 6y ago
Thanks for posting this! I distinctly remember this post way back in '12 and was wondering why no one posted this on the Coinbase IPO thread. It's like witnessing a moment in history.
jasode 6y ago
Interesting to see his business pivot that eventually happened. His original motivation (Bitbank) was a "WesternUnion/Visa/Mastercard/Paypal/Stripe" payments processor using bitcoin. At the time bitcoin was ~$5 instead of ~$60000 today. Instead of that, his Coinbase is more like a forex market maker. E.g. https://en.wikipedia.org/wiki/Foreign_exchange_market https://en.wikipedia.org/wiki/Foreign_exchange_market It was other entities (e.g. Blockstream bitcoin Lightning Network) that pursued the "small payments" space. So the only constant theme was to do something in the cryptocurrency space.
- jkhdigital 6y ago
  Yeah the early hype around disrupting transaction fees turned out to be... somewhat misguided. Although, to be fair, Satoshi Nakamoto’s white paper made this exact same miscalculation. While Coinbase does function as something like a forex market market at this point, I think its business is not nearly as commoditized as that label would suggest.
- mustafa_pasi 6y ago
  Yes, at the time there was still lots of hope that Bitcoin was going to be a currency, so everyone thought, the way to make a quick buck was to start literally any online retail/service and start accepting Bitcoin as payment. That enthusiasm was short lived. Every crypto enthusiast was wrong about that including Satoshi. The economists who shat on Bitcoin from the very beginning were right about that one thing, it was never suited to be a currency.
sumedh 6y ago
Comment from that post. > Because bitcoin worked out so well. Have fun with that, dude. > No thanks. I'd rather sell sugared water.
- beefield 6y ago
  Funny that the comment has aged pretty well. Bitcoin has been an utter failure in practically everything substantial it has been ever claiming to be[1]. In addition to being an environmental catastrophe. (This from someone who refused to bet against bitcoin ten years ago because "the markets can remain irrational longer than you can remain solvent". And still today would rather sell sugared water.) [1] haven't heard too many trying to sell it as "speculative asset with practically no underlying value whatsoever". That has admittedly been working so far quite well.
  - starfallg 6y ago
    It's impressive how long markets can remain irrational. Not just crypto, but the stock market and housing market as well. It seems that finance is completely detached from the fundamentals (and hence reality).
    - sumedh 6y ago
      > Not just crypto, but the stock market and housing market as well. Its not completely irrational though. Interest rates are at record low levels which encourages debt and you also have the US Fed printing money which is why people use BTC as a hedge.
    - Geee 6y ago
      Add gold to that list.
      - deleted 6y ago
        [deleted]
    - loeber 6y ago
ObserverNeutral 6y ago
It's all obvious in retrospect... isn't it? Just like those HBS people who shoot down Bezos when he spoke about Amazon. Thing is: common sense is right most of the times. Most of the times BTC fad just dies out, most of the times Amazon never makes it to the point when they find the real cash cow of the company (AWS) and move from being a glorified Ebay to a 1.8T company
- dkrich 6y ago
  The thing is, I still don’t feel like the vision as stated is proven. I still haven’t heard a single person explain in cogent terms the value it provides and IMO if you can’t explain something that is supposedly a revolutionary technology and the utility it provides in simple terms you don’t understand it. It’s also curious to me how the fiat skeptics/crypto bulls always cheer when crypto trades up in fiat terms. I’m not the type to conflate funding with utility, and while clearly there is massive interest in crypto, it’s still not clear to me that the entire space is more than just a speculative asset class. I don’t know anyone who uses it to purchase goods, in fact it seems that the bull case for it is that it shouldn’t be spent. Now that it’s gone from $20k to $60k in four months everyone suddenly believes in it. The absolute mania that has coincided with the price ascent alone makes me skeptical. It’s easy to cast aside naysayers when you see such a massive IPO amidst a speculative frenzy like we’re seeing in crypto and say “see, you’re wrong” but I think skepticism is healthy in certain cases and people buying coinbase and crypto now thinking they’re early to this party just feels like a suckers rally. Companies that are IPOing these days are doing so after having been private for a decade. This results in early investors cashing out on the public markets after capturing the opportunity when the risk was still massive.
  - ObserverNeutral 6y ago
    People are scared as hell of inflation and that's why the Fed was created. The "stable prices" thing is an elegant way to say "prevent inflation". Now people are really upset that the Fed not only won't allow deflation but it is pretty much encouraging inflation. They see this as a betrayal to the public and the reason why the Fed was created in the first place. There is a misalignment between the Fed inflation preference of 2% and the public inflation preference which is 0% or even -2% Enter crypto: what draws people to crypto is deflation. People love deflation, they gravitate towards crypto because deflation is hard built in protocol and it brings about financial nirvana for the saver: that is being able to increase one's net worth without doing any tangible work, manual or intellectual. That's the value of Crypto, people have lost faith in the Fed. BTC gives people what they want (hard coded deflation) and has an amazing marketing story.
IkmoIkmo 6y ago
Interesting bit of context (with some loose assumptions): one of the early investors put $300k into this and got to $2 billion recently at the IPO. Not sure when he invested, but suppose we assume 2012. The price was about $2 to $10 in that year. That'd have put the equivalent investment at $1.8 to $9 billion in bitcoin. Not sure what would've been the riskier bet. Coinbase of course could have pivoted away from Bitcoin if it didn't work out. But there are plenty of scenarios where Bitcoin succeeded, but this startup didn't. Pretty interesting that Coinbase wasn't an any more interesting investment than Bitcoin at the very start, and that while Coinbase was private, hard to invest in, and illiquid if you held it, Bitcoin was open to all to make the same bet. --- Also find it interesting that the real bet that Brian made here in his post, on building a product to undercut CC fees, didn't really materialize. Coinbase invested heavily into this, building out a marketplace for merchants for payment processing. But virtually all money is being made on being a broker for people speculating on Bitcoin as if they're buying gold, with no significant intent to use bitcoin. And payment processing is still 99.99% non-crypto, with crypto-based payment processing still being slower, costlier and less trusty. If you got me in 2012 in a time-machine to 2021 to only take a peek at the current virtually-zero level of actual use of Bitcoin, and the abundant alternative non-crypto digital banking/financial products available, and asked me to invest in Bitcoin or Coinbase... I'd have said no. (I was optimistic, so I did invest back then). I wouldn't have predicted the current price levels even with information of today.
- spurdoman77 6y ago
  The bitcoin blockchain is full of transactions, and lots are probably being made offchain on Lightning Network or on centralized services. Your claim is that all these transactions are for speculation only (which is quite common claim). On what data do you base your claim?
- blueblisters 6y ago
  > But virtually all money is being made on being a broker for people speculating on Bitcoin as if they're buying gold, with no significant intent to use bitcoin. And there is a ton of other exchanges that are both user-friendly for regular people who are looking to buy Bitcoin (Cash App) and trader-friendly for people looking to trade bitcoin (Kraken/Binance). Most serious Bitcoin enthusiasts don't prefer Coinbase over the alternatives, so I'm not sure what Coinbase's real moat is? How is it able to charge higher fees than most other crypto exchanges?
FatalLogic 6y ago
I really wonder why he posted anonymously as 'tempaccount987'? Was he still working at Airbnb then? It seems like a blunder, him not being open and transparent when he was so desperate to find a co-founder quickly and needed to establish trust. But perhaps it even helped by filtering out all those smart and cautious guys sniping at him in the comments? As one of the comments mentioned, it wasn't hard to discover his real name anyway That post is an amazing example to show anyone who believes good opportunities are always controlled by gatekeepers and limited to people with the right connections
mrfusion 6y ago
This is a good example of things to look for in an opportunity: He’s committed. He’s Already built a prototype and includes screenshots. He has a well thought out plan and posted a compelling pitch. Plus He’s not afraid to share his idea. And finally he understands that it’s going to be a lot of hard work and warns you instead of suggesting an easy opportunity.
- arbuge 6y ago
  I had similar thoughts reading his post. Hindsight is of course golden but the determination is very pronounced and comes through clearly. PG said once that successful founders are relentlessly resourceful, and that's the vibes his post gives me.
thathndude 6y ago
It’s also interesting to see just how wrong he was in many ways about BitCoin and the future. In 2012 he’s talking about changes on 5-10 years that really haven’t manifested. It’s not that they won’t eventually happen, but we often miss where the change will occur. In the last 10 years, the only material change has been adding the mobile payment layer on top of the existing infrastructure (I.e. ApplePay). We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten. -Bill Gates-
bmmayer1 6y ago
What's incredible about this is how negative the top 5-10 replies are. For as visionary as this community is, sometimes it really does miss the future right under its nose.
- koolba 6y ago
  If you shit on every idea that gets pitched to you, you'll be right the vast majority of the time. I bet the failure rate where the pitcher claims to be "Changing the world" is even higher.
- tebbers 6y ago
  Unfortunately I have come to realise that this is sadly a common issue with HackerNews. The now-famous first response on HN to Dropbox comes to mind...I still love the community here though.
  - dorkwood 6y ago
    Something people tend to ignore is that the overwhelming majority of comments in the Dropbox thread were positive. It was really only that one comment that was skeptical. edit: ok I just checked and it's more like four or five. Still, they were mostly positive.
- taytus 6y ago
  >For as visionary as this community is I love HN, but c'mon... we are a bunch of nerds or people with nerd tendencies haha, 99.99% of us (statistics made up by me...) are not visionaries at all.
- adventured 6y ago
  > For as visionary as this community is Where do you get that impression from? There's a reason why threads like this one are routinely posted here (as famously with DropBox), and the comments are always so negative. You see a similar outcome in most Show HNs that gain attention. HN is hyper cynical, mildly negative, and very tech-interested (which means new tech things are often posted / discussed). Visionary? If you were placing bets, you'd want to figure out the majority position of the comments then bet against that. SV and techies in general are every bit as prone to regressive, myopic, stagnant thinking as the wider world, despite the self-touting nature of the industry as supposedly being forward looking.
jl2718 6y ago
Wow. Brian Armstrong was successful for all the reasons that I wasn’t. Self-reflection here. First, to me, Bitcoin wasn’t good enough. I had ‘better’ ideas for digital currency. They weren’t. Bitcoin was a thing, and anything else was not a thing. Secondly, I read all the regulations and came to the conclusion that I had to start a bank first, and I spent my time trying to build a system to interact with fed wire. This was wasted. The regulators grimaced, but the business got built anyway. Third, he was actively looking for a cofounder, and made that a huge part of his life. I didn’t even think about that, especially in my small town, ironically the same small town as Fred Ehrsam. Fourth, he had extreme focus and perseverance. The last time I had tried a startup as a full time job, I was not ready to be ridiculed by family and called a loser by women, and have the idea rejected by every business person that saw it (Actually there was one guy that liked it. He ended up in jail and then tried to sue Mark Zuckerberg for half of FB.) I was hedging my bets on lots of ideas, classes at fancy schools, and a day job that made me feel important. So, failing at everything. Fifth, he actually applied to YC with what he had instead of pushing it off to ‘someday’ when it was perfect or assuming it would be a waste of time because everybody else said ‘no’. Maybe there is some luck involved, maybe he was taking on a lot more risk, or had a personal situation that was more amenable, but all I see is pure grind on something he believed in while I just didn’t have it. And I can’t fault my family either. I saw it all right in front of my face. My father did great work that established his employer as a leader in the field. I spent my life wanting to be just like him. Plaques and appreciation awards all over the house. It was a big company which eventually failed and that was it, career over, entry-level job hunting at 50. My uncle started a very simple sales business, spent 5 years doing a lot for a little, and then 35 years doing very little for a lot. I had my performance review yesterday during the Coinbase IPO. I still have a job. I still have a boss. I started working when I was 13, and every year of my life, I feel more and more consumed by whatever some other arbitrary person thinks about me. I take these jobs because I want to focus on doing great work without thinking about any of the other stuff. And then I get the 120-point checklist on all of the ways that I am being evaluated, mostly raving corporatist bullshit that boils down to somebody’s feelings, so I’m supposed to spend my life on that, and if I don’t, I get fired, which is supposed to be a really terrible thing. Except, all my fiends that got fired early on in their careers are winning big now, on their own, nobody telling them that they are less of a person than they believe themselves to be. Sure, BA is a cherry-picked example. Sure, there are thousands that failed for each that succeeded. But what does success look like on the other side? It sucks. I did well, but I’d rather be broke and have the last 25 years of my life back. Own yourself. I thought I was a renegade. I thought I was immune. I’m not. You aren’t either. Look at all those responses asking BA to qualify himself as a 10x googler before they will talk to him. Those are the losers. Not you. You are powerful beyond measure. Your instincts are correct. You don’t need Stanford or google or whatever. Those places have nothing to teach you except how to outsource your self-worth. Don’t go down that path. Cheers to Brian and Fred and everybody else that did it because they believed in something when everybody shat on them for it.
Graffur 6y ago
Someone posted (in 2012): > Boy. This is the 60000 dollar question isn't it? Who wants to be my partner? Good luck. I really hope you find them. Taking on the credit card industry is going to be awesome! BTC is now 60,000 dollars. Weird.
- stagas 6y ago
  Time traveller.
astoor 6y ago
Looking for a co-founder with a throwaway account is a reminder of how super-shady cryptocurrency was back then. Before the online exchanges, the only way you could buy and sell was by meeting up with dodgy characters on back streets, and paying/receiving cash because if your bank so much as caught a whiff of cryptocurrency-related activity they'd close your account immediately given the only legitimate use cases at the time were all illegal activities like buying drugs or money laundering. Still not entirely sure exactly what changed.
omarhaneef 6y ago
Is it too late?
- rawtxapp 6y ago
  Too late to be his co-founder? Very likely. Too late to get into crypto? Nope, still the very early days.
  - omarhaneef 6y ago
    Are you sure? It has only been a few days since the IPO.
- stevewodil 6y ago
  No I don't think so, it doesn't look like anyone was interested. Maybe send him an email?
scabarott 6y ago
Wow. Reading the top comments. If you have a great idea, just tune out the HN comments
m3kw9 6y ago
Is this a time machine? I’m gonna apply
cbHXBY1D 6y ago
"Change the world" Surely this is a case where if CB hadn't provided a centralized exchange someone else would have? If CB didn't exist people would buy cryptocurrency with a different app and there lives would be the same.
- seriousquestion 6y ago
  Others have, but most are not nearly as user friendly as CB.
anonu 6y ago
The comments from 2012 follow the typical pattern: haters, doubters, skeptics. Lots of lessons to be learned from that...
lazzlazzlazz 6y ago
Hacker News has had a long history of unwarranted skepticism toward crypto and decentralized consensus systems. It's surprising that so many of the negative responses (and commentators themselves!) are still around today, seemingly impervious to the profound developments over the last near-decade.

281 points by swyx 6y ago

Some of the comments in this are great: > Transferring bitcoin funds is already easy with the GUI. Sure a wrapper around it might make it slightly more user friendly but it's trivially easy to implement. Not to mention the fact that Bitcoin is illegal in most developed countries. > I don't think alternative currencies have a long-term future. The only reason they exist now is because people and governments in most countries are quite ignorant about technology. Once they become more widely used, they will start causing a whole lot of problems* and will be banned by governments. > Did you invest in Bitcoin when it was $21, and want to bring that price back up?

cblconfederate 6y ago
Versions of the same comments could be made even today. It's a great company with a bright future, and their own cut of the pie is guaranteed, but there are excellent exchanges outside US
- arthur_sav 6y ago
  I live outside the US and still use Coinbase because they have created an image of trust, and so far they deliver on that. Personally i don't care if they're not the cheapest as long as they don't screw me when i need them the most.
  - jkhdigital 6y ago
    Exactly, Coinbase actually seems to give a shit about the customer relationship, something which is virtually nonexistent in the crypto space. Case in point: for a long time they covered all network fees when withdrawing from Coinbase Pro, while most exchanges charged a flat rate which inevitably was abused as a profit source.
    - deleted 6y ago
      [deleted]
  - cblconfederate 6y ago
    Coinbase will one day become a crypto bank, but right now the role of exchanges is minimal, on/offramps and being the wallet for a lot of people. I don't think they re much different than binance. They re more trusted because as an american company they are considered more protected, but that's not something they achieved, it's afforded to them by the fact that they're american.
    - arthur_sav 6y ago
      The reason i trust them is the people, the work and not the location. Coinbase is backed by respected investors, the founder is well known and they seem to be in for the long run. Security wise, they have implemented many counter measures to prevent funds being stolen and so far i haven't heard of any breaches. They can handle large sums of money with no issues. So to sum up, they don't do sloppy work and the founder won't mysteriously disappear with the funds.

headsupftw 6y ago

So did he find a cofounder on HN? I actually met a cofounder of Coinbase on an airplane and he emailed me on the spot a cup of coffee in BTC. Let's just say it has turned into dozens and dozens of cups of coffee by now.

shawabawa3 6y ago
He found his co founder on Reddit in the end Brian used to give everyone he met who didn't have bitcoin $10 worth so I guess that was who you met

throwaway10110 6y ago

That is just awesome, I go into bitcoin in 2011 or 2012 (in top few hundred users on bitcoin-otc back when price was $4 a pop) and had loads of ideas for services (+ accepted bitcoin for years for webhosting) but listened to all negative comments about crypto and spend most of them over years (have a descent stash left) and hence now not a billionaire just a millionaire, but yeh moral of story is not to listen to overly critical nerds who are overly negative about every subject (often just to be edgy/cynical) and just do it!

midasuni 6y ago
For every example like this, how many are there of people failing?
- Isn0gud 6y ago
  Yeah, if you know the future, just play the lottery, its much quicker!
- seriousquestion 6y ago
  Unknown. But we do know that you miss 100% of the shots you don't take.
  - midasuni 6y ago
    You miss 100% of the shots you can’t take because of the high risk play.
sumedh 6y ago
Even if HN would was more pro BTC back in the day you and most others would have sold a majority of BTC when the price started crashing from the 20K USD peak
- hmmokidk 6y ago
  I struggle with this. How do you know when to sell for good? I suppose it is when you predict opinion is going to work against this and public opinion seems a very slow moving thing. Unless some sort of crazy event occurs.

cblconfederate 6y ago

Moral of the story is, he didn't find one. It's impressive how transparent he was. But maybe he did not use the current-month's favourite javascript metatranscompiler

rawtxapp 6y ago
He didn't find one on HN (which is famously anti-crypto), he found his co-founder (Fred Ehrsam) through reddit.
- spottybanana 6y ago
  Wonder if he had any posts on reddit that have stayed there?
- jahn716 6y ago
  it is shockingly not very pro crypto, huh?
- beefield 6y ago
  > which is famously anti-crypto The threshold to being famously anti-crypto seems to be quite low. Like, not everyone being completely uncritically positive about crypto.
- mustafa_pasi 6y ago
  In 2012 HN was not so pessimistic about crypto.

deleted 6y ago

[deleted]

sagolikasoppor 6y ago

Cool unfortunately I was too young and inexperienced at that time. Coinbase is a great service.

practicalpants 6y ago

Intriguing that the motivation for coinbase was: "Credit card fees are too high. In the next five years merchants are going to start moving away from..." I think it's fair to say he was actually wrong. But succeeded nonetheless because everyone now wants to get rich speculating on cryptos, which is the dominant reason they are so popular.

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xur17 6y ago
I honestly think stablecoins on a layer 2 network have a good shot assuming merchants find a good way to incentivize it over credit cards.

FlyingSnake 6y ago

Thanks for posting this! I distinctly remember this post way back in '12 and was wondering why no one posted this on the Coinbase IPO thread. It's like witnessing a moment in history.

jasode 6y ago

Interesting to see his business pivot that eventually happened. His original motivation (Bitbank) was a "WesternUnion/Visa/Mastercard/Paypal/Stripe" payments processor using bitcoin. At the time bitcoin was ~$5 instead of ~$60000 today. Instead of that, his Coinbase is more like a forex market maker. E.g. https://en.wikipedia.org/wiki/Foreign_exchange_market https://en.wikipedia.org/wiki/Foreign_exchange_market It was other entities (e.g. Blockstream bitcoin Lightning Network) that pursued the "small payments" space. So the only constant theme was to do something in the cryptocurrency space.

jkhdigital 6y ago
Yeah the early hype around disrupting transaction fees turned out to be... somewhat misguided. Although, to be fair, Satoshi Nakamoto’s white paper made this exact same miscalculation. While Coinbase does function as something like a forex market market at this point, I think its business is not nearly as commoditized as that label would suggest.
mustafa_pasi 6y ago
Yes, at the time there was still lots of hope that Bitcoin was going to be a currency, so everyone thought, the way to make a quick buck was to start literally any online retail/service and start accepting Bitcoin as payment. That enthusiasm was short lived. Every crypto enthusiast was wrong about that including Satoshi. The economists who shat on Bitcoin from the very beginning were right about that one thing, it was never suited to be a currency.

sumedh 6y ago

Comment from that post. > Because bitcoin worked out so well. Have fun with that, dude. > No thanks. I'd rather sell sugared water.

beefield 6y ago
Funny that the comment has aged pretty well. Bitcoin has been an utter failure in practically everything substantial it has been ever claiming to be[1]. In addition to being an environmental catastrophe. (This from someone who refused to bet against bitcoin ten years ago because "the markets can remain irrational longer than you can remain solvent". And still today would rather sell sugared water.) [1] haven't heard too many trying to sell it as "speculative asset with practically no underlying value whatsoever". That has admittedly been working so far quite well.
- starfallg 6y ago
  It's impressive how long markets can remain irrational. Not just crypto, but the stock market and housing market as well. It seems that finance is completely detached from the fundamentals (and hence reality).
  - sumedh 6y ago
    > Not just crypto, but the stock market and housing market as well. Its not completely irrational though. Interest rates are at record low levels which encourages debt and you also have the US Fed printing money which is why people use BTC as a hedge.
  - Geee 6y ago
    Add gold to that list.
    - deleted 6y ago
      [deleted]
  - loeber 6y ago

ObserverNeutral 6y ago

It's all obvious in retrospect... isn't it? Just like those HBS people who shoot down Bezos when he spoke about Amazon. Thing is: common sense is right most of the times. Most of the times BTC fad just dies out, most of the times Amazon never makes it to the point when they find the real cash cow of the company (AWS) and move from being a glorified Ebay to a 1.8T company

dkrich 6y ago
The thing is, I still don’t feel like the vision as stated is proven. I still haven’t heard a single person explain in cogent terms the value it provides and IMO if you can’t explain something that is supposedly a revolutionary technology and the utility it provides in simple terms you don’t understand it. It’s also curious to me how the fiat skeptics/crypto bulls always cheer when crypto trades up in fiat terms. I’m not the type to conflate funding with utility, and while clearly there is massive interest in crypto, it’s still not clear to me that the entire space is more than just a speculative asset class. I don’t know anyone who uses it to purchase goods, in fact it seems that the bull case for it is that it shouldn’t be spent. Now that it’s gone from $20k to $60k in four months everyone suddenly believes in it. The absolute mania that has coincided with the price ascent alone makes me skeptical. It’s easy to cast aside naysayers when you see such a massive IPO amidst a speculative frenzy like we’re seeing in crypto and say “see, you’re wrong” but I think skepticism is healthy in certain cases and people buying coinbase and crypto now thinking they’re early to this party just feels like a suckers rally. Companies that are IPOing these days are doing so after having been private for a decade. This results in early investors cashing out on the public markets after capturing the opportunity when the risk was still massive.
- ObserverNeutral 6y ago
  People are scared as hell of inflation and that's why the Fed was created. The "stable prices" thing is an elegant way to say "prevent inflation". Now people are really upset that the Fed not only won't allow deflation but it is pretty much encouraging inflation. They see this as a betrayal to the public and the reason why the Fed was created in the first place. There is a misalignment between the Fed inflation preference of 2% and the public inflation preference which is 0% or even -2% Enter crypto: what draws people to crypto is deflation. People love deflation, they gravitate towards crypto because deflation is hard built in protocol and it brings about financial nirvana for the saver: that is being able to increase one's net worth without doing any tangible work, manual or intellectual. That's the value of Crypto, people have lost faith in the Fed. BTC gives people what they want (hard coded deflation) and has an amazing marketing story.

IkmoIkmo 6y ago

Interesting bit of context (with some loose assumptions): one of the early investors put $300k into this and got to $2 billion recently at the IPO. Not sure when he invested, but suppose we assume 2012. The price was about $2 to $10 in that year. That'd have put the equivalent investment at $1.8 to $9 billion in bitcoin. Not sure what would've been the riskier bet. Coinbase of course could have pivoted away from Bitcoin if it didn't work out. But there are plenty of scenarios where Bitcoin succeeded, but this startup didn't. Pretty interesting that Coinbase wasn't an any more interesting investment than Bitcoin at the very start, and that while Coinbase was private, hard to invest in, and illiquid if you held it, Bitcoin was open to all to make the same bet. --- Also find it interesting that the real bet that Brian made here in his post, on building a product to undercut CC fees, didn't really materialize. Coinbase invested heavily into this, building out a marketplace for merchants for payment processing. But virtually all money is being made on being a broker for people speculating on Bitcoin as if they're buying gold, with no significant intent to use bitcoin. And payment processing is still 99.99% non-crypto, with crypto-based payment processing still being slower, costlier and less trusty. If you got me in 2012 in a time-machine to 2021 to only take a peek at the current virtually-zero level of actual use of Bitcoin, and the abundant alternative non-crypto digital banking/financial products available, and asked me to invest in Bitcoin or Coinbase... I'd have said no. (I was optimistic, so I did invest back then). I wouldn't have predicted the current price levels even with information of today.

spurdoman77 6y ago
The bitcoin blockchain is full of transactions, and lots are probably being made offchain on Lightning Network or on centralized services. Your claim is that all these transactions are for speculation only (which is quite common claim). On what data do you base your claim?
blueblisters 6y ago
> But virtually all money is being made on being a broker for people speculating on Bitcoin as if they're buying gold, with no significant intent to use bitcoin. And there is a ton of other exchanges that are both user-friendly for regular people who are looking to buy Bitcoin (Cash App) and trader-friendly for people looking to trade bitcoin (Kraken/Binance). Most serious Bitcoin enthusiasts don't prefer Coinbase over the alternatives, so I'm not sure what Coinbase's real moat is? How is it able to charge higher fees than most other crypto exchanges?

FatalLogic 6y ago

I really wonder why he posted anonymously as 'tempaccount987'? Was he still working at Airbnb then? It seems like a blunder, him not being open and transparent when he was so desperate to find a co-founder quickly and needed to establish trust. But perhaps it even helped by filtering out all those smart and cautious guys sniping at him in the comments? As one of the comments mentioned, it wasn't hard to discover his real name anyway That post is an amazing example to show anyone who believes good opportunities are always controlled by gatekeepers and limited to people with the right connections

mrfusion 6y ago

This is a good example of things to look for in an opportunity: He’s committed. He’s Already built a prototype and includes screenshots. He has a well thought out plan and posted a compelling pitch. Plus He’s not afraid to share his idea. And finally he understands that it’s going to be a lot of hard work and warns you instead of suggesting an easy opportunity.

arbuge 6y ago
I had similar thoughts reading his post. Hindsight is of course golden but the determination is very pronounced and comes through clearly. PG said once that successful founders are relentlessly resourceful, and that's the vibes his post gives me.

thathndude 6y ago

It’s also interesting to see just how wrong he was in many ways about BitCoin and the future. In 2012 he’s talking about changes on 5-10 years that really haven’t manifested. It’s not that they won’t eventually happen, but we often miss where the change will occur. In the last 10 years, the only material change has been adding the mobile payment layer on top of the existing infrastructure (I.e. ApplePay). We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten. -Bill Gates-

bmmayer1 6y ago

What's incredible about this is how negative the top 5-10 replies are. For as visionary as this community is, sometimes it really does miss the future right under its nose.

koolba 6y ago
If you shit on every idea that gets pitched to you, you'll be right the vast majority of the time. I bet the failure rate where the pitcher claims to be "Changing the world" is even higher.
tebbers 6y ago
Unfortunately I have come to realise that this is sadly a common issue with HackerNews. The now-famous first response on HN to Dropbox comes to mind...I still love the community here though.
- dorkwood 6y ago
  Something people tend to ignore is that the overwhelming majority of comments in the Dropbox thread were positive. It was really only that one comment that was skeptical. edit: ok I just checked and it's more like four or five. Still, they were mostly positive.
taytus 6y ago
>For as visionary as this community is I love HN, but c'mon... we are a bunch of nerds or people with nerd tendencies haha, 99.99% of us (statistics made up by me...) are not visionaries at all.
adventured 6y ago
> For as visionary as this community is Where do you get that impression from? There's a reason why threads like this one are routinely posted here (as famously with DropBox), and the comments are always so negative. You see a similar outcome in most Show HNs that gain attention. HN is hyper cynical, mildly negative, and very tech-interested (which means new tech things are often posted / discussed). Visionary? If you were placing bets, you'd want to figure out the majority position of the comments then bet against that. SV and techies in general are every bit as prone to regressive, myopic, stagnant thinking as the wider world, despite the self-touting nature of the industry as supposedly being forward looking.

jl2718 6y ago

Wow. Brian Armstrong was successful for all the reasons that I wasn’t. Self-reflection here. First, to me, Bitcoin wasn’t good enough. I had ‘better’ ideas for digital currency. They weren’t. Bitcoin was a thing, and anything else was not a thing. Secondly, I read all the regulations and came to the conclusion that I had to start a bank first, and I spent my time trying to build a system to interact with fed wire. This was wasted. The regulators grimaced, but the business got built anyway. Third, he was actively looking for a cofounder, and made that a huge part of his life. I didn’t even think about that, especially in my small town, ironically the same small town as Fred Ehrsam. Fourth, he had extreme focus and perseverance. The last time I had tried a startup as a full time job, I was not ready to be ridiculed by family and called a loser by women, and have the idea rejected by every business person that saw it (Actually there was one guy that liked it. He ended up in jail and then tried to sue Mark Zuckerberg for half of FB.) I was hedging my bets on lots of ideas, classes at fancy schools, and a day job that made me feel important. So, failing at everything. Fifth, he actually applied to YC with what he had instead of pushing it off to ‘someday’ when it was perfect or assuming it would be a waste of time because everybody else said ‘no’. Maybe there is some luck involved, maybe he was taking on a lot more risk, or had a personal situation that was more amenable, but all I see is pure grind on something he believed in while I just didn’t have it. And I can’t fault my family either. I saw it all right in front of my face. My father did great work that established his employer as a leader in the field. I spent my life wanting to be just like him. Plaques and appreciation awards all over the house. It was a big company which eventually failed and that was it, career over, entry-level job hunting at 50. My uncle started a very simple sales business, spent 5 years doing a lot for a little, and then 35 years doing very little for a lot. I had my performance review yesterday during the Coinbase IPO. I still have a job. I still have a boss. I started working when I was 13, and every year of my life, I feel more and more consumed by whatever some other arbitrary person thinks about me. I take these jobs because I want to focus on doing great work without thinking about any of the other stuff. And then I get the 120-point checklist on all of the ways that I am being evaluated, mostly raving corporatist bullshit that boils down to somebody’s feelings, so I’m supposed to spend my life on that, and if I don’t, I get fired, which is supposed to be a really terrible thing. Except, all my fiends that got fired early on in their careers are winning big now, on their own, nobody telling them that they are less of a person than they believe themselves to be. Sure, BA is a cherry-picked example. Sure, there are thousands that failed for each that succeeded. But what does success look like on the other side? It sucks. I did well, but I’d rather be broke and have the last 25 years of my life back. Own yourself. I thought I was a renegade. I thought I was immune. I’m not. You aren’t either. Look at all those responses asking BA to qualify himself as a 10x googler before they will talk to him. Those are the losers. Not you. You are powerful beyond measure. Your instincts are correct. You don’t need Stanford or google or whatever. Those places have nothing to teach you except how to outsource your self-worth. Don’t go down that path. Cheers to Brian and Fred and everybody else that did it because they believed in something when everybody shat on them for it.

Graffur 6y ago

Someone posted (in 2012): > Boy. This is the 60000 dollar question isn't it? Who wants to be my partner? Good luck. I really hope you find them. Taking on the credit card industry is going to be awesome! BTC is now 60,000 dollars. Weird.

stagas 6y ago
Time traveller.

astoor 6y ago

Looking for a co-founder with a throwaway account is a reminder of how super-shady cryptocurrency was back then. Before the online exchanges, the only way you could buy and sell was by meeting up with dodgy characters on back streets, and paying/receiving cash because if your bank so much as caught a whiff of cryptocurrency-related activity they'd close your account immediately given the only legitimate use cases at the time were all illegal activities like buying drugs or money laundering. Still not entirely sure exactly what changed.

omarhaneef 6y ago

Is it too late?

rawtxapp 6y ago
Too late to be his co-founder? Very likely. Too late to get into crypto? Nope, still the very early days.
- omarhaneef 6y ago
  Are you sure? It has only been a few days since the IPO.
stevewodil 6y ago
No I don't think so, it doesn't look like anyone was interested. Maybe send him an email?

scabarott 6y ago

Wow. Reading the top comments. If you have a great idea, just tune out the HN comments

m3kw9 6y ago

Is this a time machine? I’m gonna apply

cbHXBY1D 6y ago

"Change the world" Surely this is a case where if CB hadn't provided a centralized exchange someone else would have? If CB didn't exist people would buy cryptocurrency with a different app and there lives would be the same.

seriousquestion 6y ago
Others have, but most are not nearly as user friendly as CB.

anonu 6y ago

The comments from 2012 follow the typical pattern: haters, doubters, skeptics. Lots of lessons to be learned from that...

lazzlazzlazz 6y ago

Hacker News has had a long history of unwarranted skepticism toward crypto and decentralized consensus systems. It's surprising that so many of the negative responses (and commentators themselves!) are still around today, seemingly impervious to the profound developments over the last near-decade.