The First One Through the Door Gets Shot
When he was 22, Charlie Shrem founded a company called BitInstant.
In the early days of Bitcoin, his company would hold a dollar balance at the world’s largest exchange Mt. Gox, so his customers could give BitInstant the money and instantly get Bitcoin back from Mt. Gox. This way, they didn’t have to send the money to Mt. Gox directly, which often took days, since the exchange was in Japan.
It quickly became one of the largest Bitcoin services in the world, handling millions of dollars in transactions.
In 2014 when he got off a return flight at JFK airport, he was arrested and supposed to be tried for money laundering, facing up to 20 years in prison.
Apparently, Charlie had helped anonymize transactions to a user named ‘btcKing’ who in turn sold the Bitcoins he bought to people using the infamous SilkRoad marketplace to buy drugs, weapons and other illegal goods.
Charlie made a smart move. Knowing he was up against the most powerful institution in the world — the US banking system — he pleaded guilty and ultimately got away with a 15-month sentence.
But why is his story interesting?
The First Shot
I’m sure Charlie Shrem’s slate isn’t all clean. You always need two parties to play a game. But in the documentary Banking On Bitcoin, early adopter Erik Voorhees notes:
We have banks that have ATMs on every street corner in America and those banks know very well that that cash is getting used for drugs, and yet, that’s fine. They’re allowed to do that. No one gets in trouble.
But Charlie sells Bitcoin to a guy who sells Bitcoin to someone who uses drugs and he goes to jail. He was an entrepreneur that started building this industry, build services that people found useful, when bankers almost destroyed the world economy and none of those got in trouble whatsoever.
And here we have this 23-year old kid, he goes to jail, because he started building an alternative.
Change means destruction. The old has to make way for the new. But especially when ‘the old’ is a bunch of really powerful humans, it would rather stay in its place. It’ll fight back.
It’s very rare for the first shot to penetrate the wall. Another commenter says:
Unfortunately, early adopters make the roads that we all travel down. And they are usually paved over in the process. The first guy through the door gets shot. Somebody’s gotta go through the door. But they’re gonna get shot.
Charlie Shrem, Ross Ulbricht, Julian Assange, they got shot, coming through the door. But we’re all utilizing the freedom and technologies afforded to us because they knocked the door down.
A shocking number of other early Bitcoin adopters has suffered a similar fate. Many have had their homes raided, some been convicted, few even died under mysterious circumstances.
What’s the Lesson?
The first one through the door gets shot.
This is true in any other field. Technology, politics, creativity, science, social equality. Innovators who revolutionize the system become moving targets.
Sometimes, this means nothing more than enduring nasty comments. Sometimes, it’s a matter of life and death.
But whatever mission you’re on, you have to ask yourself: Are you willing to be the first through the door? Are you willing to get shot?