Ripple CTO Explains How He Bought 40,000 Ethereum with $12,400

Ripple’s CTO, David Schwartz, revealed how he acquired 40,000 Ethereum tokens during the public initial coin offering (ICO).

The revelation came after a community member asked Schwartz on X to clarify his initial involvement with Ethereum before the public pre-ICO. The inquiry stemmed from Schwartz’s previous revelation that he sold 40K units of Ethereum assets for $1 per ETH to fund solar panels for a house he has since sold.

Notably, the disclosure was a contemplative look back at his premature disposal of the ETH assets, especially considering the value soared by 1,000% soon after he sold his holdings.

How Ripple CTO Bought 40K ETH During ICO

Regarding the inquiry, the Ripple CTO clarified that his participation in the Ethereum ICO was not just a business decision but a personal one. It came from his acquaintance with Vitalik Buterin, one of Ethereum’s founders.

Schwartz stated that Buterin, a close friend, invited him to participate in the ICO. And since he wanted to support Buterin, he sent 20 BTC.

I knew Vitalik. He invited me to participate. I wanted to support him, so went in for 20 BTC. I didn't really ask any questions. It got me 40,000 ETH. I thought of it as helping an acquaintance.

— David "JoelKatz" Schwartz (@JoelKatz) May 10, 2024

Furthermore, Schwartz explained that he invested this amount without pressing for much detail, as he primarily viewed it as a means to support an acquaintance. Remarkably, for the 20 BTC he contributed to the ICO, the Ripple executive received 40,000 ETH in return.

ETH ICO

Notably, public records corroborate Schwartz’s account. The Ethereum ICO reportedly lasted 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. By the end of the token sale, 1 BTC could purchase 1,337 ETH.

Notably, the Ethereum team announced the ICO at the North American Bitcoin Conference in Miami early in 2014. The fundraising approach employed by the Ethereum team was considered innovative at the time.

Ripple CTO Missed out on $4M Fortune

Having bought 40,000 ETH tokens for approximately $12,400, Ripple’s CTO liquidated the portfolio when the value rose to $40,000. This sale resulted in a 222.58% return on investment after a two-year holding period.

However, had Schwartz held onto his investment for an additional year, he could have seen an astonishing gain of 32,158%. The growth would have elevated the initial $12,400 ETH portfolio to $4,000,000.