2021 in Review: the Top 10 Crypto Villains of the Year
As crypto has experienced parabolic growth in 2021, several villains have emerged. Crypto Briefing lists some of the biggest culprits.
- The latest crypto bull run has brought out greed and bad practices.
- The space saw several major rug pulls and insider trading incidents throughout the year.
- NFT technology's entry into the mainstream also led to many misguided criticisms from skeptics.
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Insider trading, rug pulls, misinformation in the media: crypto’s latest bull run has had a dark side. Crypto Briefing identifies the villains responsible for the most controversial events of the year.
The Biggest Crypto Villains of 2021
Where there’s money, there’s greed—and shady practices closely follow. At this point it’s no secret that crypto had a big year, with the rise of assets like Bitcoin, Ethereum, and Solana pushing the global cryptocurrency market cap over $3 trillion for the first time.
But while the market enriched countless investors and traders, there were many who abandoned ethics to increase their winnings. This year’s roundup of the top crypto villains featured some of the main protagonists, but there were also more rug pulls than we could possibly count on one feature. One surprise to this year was the addition of people we’ve respected in the past, validating the view that money does indeed change everything.
Crypto had its fair share of enemies outside of the space, perhaps most notably the boomers charged with overseeing financial regulation in the U.S. Of course, it’s not only Gensler and co. that crypto has had to contend with. This year was also particularly big for NFTs, which also brought in the phenomenon of the “right click savers”–groups of angry keyboard warriors who identify themselves by their radical politics and inexplicable hatred of emerging technology. We couldn’t possibly list every NFT skeptic who shared questionable views about the movement online this year, and besides, we think they’re likely to backtrack on their views as soon as it suits them a few years from now.
Instead, Crypto Briefing has identified several individuals who made enemies with almost everyone in crypto this year, as well as the stars of some of the most shocking incidents we’ve witnessed since January. Here’s our full list of the top 10 worst actors for 2021 in crypto in all its glory.
When Crypto Briefing started to draw up a shortlist of names that would feature on this year’s villains list, Su Zhu wasn’t the first person that came to mind. Zhu is an influential figure in the space, and his podcast appearances on Uncommon Core frequently get filed as “essential listening” in the Crypto Briefing Slack channel. Zhu is known for his Yoda-like wisdom, but following him on every call he makes can be risky because he trades like an assassin. Back in May, he memorably called for $25,000 ETH on Bankless after declaring that Three Arrows Capital, the hedge fund he runs alongside Kyle Davies, had acquired enough of the asset to become one of the biggest holders in the world. But by the end of the summer, he and Davies had announced a leading position in a $230 million Avalanche raise, and the pair turned their focus to promoting the Layer 1 chain’s AVAX coin to their 400,000 Twitter followers. Zhu caused a stir in late November on the weekend AVAX topped $140 after falling into an Ethereum vs. Avalanche row with Synthetix’s Kain Warwick on Twitter, before declaring that Ethereum’s gas fees had inspired his decision to look to other Layer 1 competitors. The bombshell—and reason for adding him to this list—came when he declared that he had “abandoned Ethereum” and that Ethereum had “abandoned its users,” at once angering the project’s AllCoreDevs, various teams working on infrastructure and Layer 2 solutions, and the community members who’d listened to his ultra-bullish ETH targets barely six months prior. However, while Zhu appeared set on turning his back on Ethereum in favor of more centralized alternatives, it seems his thesis has already changed: Three Arrows Capital has acquired over 100,000 ETH in the last few days. The incident is a crucial reminder that Zhu tends to rotate his holdings faster than Solana transactions reach finality, so it’s reasonable to assume he’s already thinking of another project to endorse once he starts hyping any one coin on Twitter.
There’s always a drama happening somewhere in crypto, but one week in September saw enough controversy for a six-part Netflix series. On one day, Walmart appeared to announce a partnership with Litecoin, to the bemusement of almost anyone who pays close attention to the space. Reuters and CNBC fueled the fire–and LTC rally–by reporting on the update, before it transpired that the press release was fake. LTC crashed as quickly as it had soared, while the mainstream journalists who fell for the story were left with egg on their faces. The following day, Solana went down due to bots spamming a Raydium IDO launch, preventing blocks from processing. The high-speed chain’s founder Anatoly Yakovenko brushed off the outage by claiming that the situation was comparable to Ethereum’s exorbitant gas fees pricing out users, and the chain was still down 18 hours later. The most shocking story of that week, though, involved OpenSea’s then head of product, Nate Chastain. A popular personality in the NFT community, Chastain was widely known on Crypto Twitter through his CryptoPunk NFT avatar and ENS domain name. However, it was his online presence (combined with a spate of poor decision making) that ultimately contributed to his downfall. As he tied his Ethereum address to his name and online identity, a group of on-chain sleuths was able to identify a series of transactions that showed he had been buying NFTs from artists mere minutes before they were promoted on OpenSea’s marketplace. Once they jumped in value on the listing, Chastain would sell the assets for a quick profit then dump the ETH he’d made back to his named address. The public ledger meant it was all there for anyone with the inclination to see, so his resignation the following day felt inevitable. OpenSea was valued at $10 billion this year, so Chastain could easily have been in line for an eight-figure equity sum as an early team member. Instead, he got 19 ETH worth around $65,000 and disappeared from the NFT community without a trace.
If you ever catch wind of a project’s potential airdrop, you can win big by interacting with the protocol across multiple addresses. That also means that there’s always a risk that insiders could be gaming airdrops to walk away with a tidy sum, as the Ribbon Finance and Divergence Ventures saga proved back in October. Soon after the DeFi project had distributed tokens to early supporters, the on-chain analyst gabagool.eth raised his suspicions when he noticed that one address was receiving funds from multiple wallets that had dumped their RBN holdings for $2.5 million worth of ETH. Thanks to ENS, he realized that the wallet belonged to the Divergence Ventures employee Bridget Harris, a VC firm that backed Ribbon with a $25,000 seed investment. Ribbon conceded that it had informed the fund of a token drop, but said that it didn’t specify the criteria. Further analysis revealed that the firm had been airdrop farming across every project it had invested in and was likely using its insider position to take tokens that could have been allocated to other community members. Divergence’s two founders, Calvin Liu and George Lambeth, posted a series of weak apologies and defended their actions by remarking that their goal is “to make money” and that they weren’t the only team employing the same tactic, before returning their RBN tokens. But that wasn’t all they lost thanks to gabagool’s detective work: their reputation was also tarnished for good following the incident.
Where to start with Elon Musk? First, there were the Dogecoin memes, which inspired a wave of dog coins that substituted cute Shiba Inu branding for what they lacked in fundamental use cases. There were the misguided posts about how Bitcoin and Ethereum couldn’t scale to the same degree as Dogecoin. And worst of all, there was the announcement that Tesla would stop receiving BTC payments due to purported environmental concerns, which landed just ahead of the biggest market crash since Black Thursday (However, Tesla did continue to hold BTC on its balance sheet following a $1.5 billion investment announced in February). Musk also told the world that Dogecoin was “a hustle” on Saturday Night Live resulting in a crash, by which point he’d become aware that his words alone could move the markets. Musk has cooled off since then, but after this year, the crypto community is well aware that the market is only ever one tweet away from a 10% jolt in either direction–and that there may not be any reason for the move other than a bored billionaire looking for attention.
moon guurl, a self-proclaimed crypto enthusiast who also goes by the name Rea, made no secret that she wanted to brand herself as a crypto influencer when she joined the space in mid-2020. She built her brand by sharing snaps of herself on beaches and dubious prose about where the market could move next, and her following quickly hit the size that crypto projects looking for more reach could benefit from. In her case, she received an offer from the meme project Isla Inu in exchange for 1% of the project’s token supply. As the popular Twitter user zachxbt pointed out, her true colors came out when she decided to post a tweet about the project without disclosing how she was benefiting, then dumped her token supply for 22.8 ETH, around $100,000 at the time. The token was so illiquid that it tanked to near zero, meaning she’d pulled the rug from anyone who bought into the project off the back of her undisclosed tweet. She feigned innocence by claiming that she didn’t understand the illiquidity problem, which is believable given her relatively entry level content. However, she made things worse by posting a remorseless reflection on the incident, arguing that Crypto Twitter had bullied her and given her anxiety. Of all the errors of judgment she made, it’s hard to work out which is worse: the secretive sponsored deal, the rug pull itself, or the reaction that made light of mental health in a vain attempt to justify her actions. Either way, moon guurl is no more to anyone who caught wind of the incident these days—and the community is better off for it.
What happens when you take a former TradFi hotshot thought to be worth as much as $119 million and put them in charge of regulating the finance sector at the SEC? So far, the outcome for crypto has been as bad as you might expect. But when the crypto community first found out about Gensler’s move to SEC chair late last year, there was palpable excitement for him to take on the role given his knowledge of the space (Gensler has taught blockchain, smart contracts, and DeFi at MIT). Sadly, Gensler has proved consistently that he has a problem with digital assets. It’s not so much Bitcoin or Ethereum he has taken an issue with, although the SEC has continued to block a spot BTC ETF while allowing a futures-based fund. It’s more the technology that runs on Ethereum Gensler is worried about–not least DeFi and stablecoins. Gensler has stumbled over providing any regulatory clarity over the space aside from warning that DeFi tokens could be securities, and he’s shared fears of stablecoins alongside other suits like Jerome Powell. Meanwhile, he also oversaw the SEC’s move to serve Terra’s Do Kwon with a subpoena in September, and because of the agency’s strict regulatory oversight, countless DeFi traders in the U.S. have missed out on lucrative airdrop opportunities from projects like dYdX. Gensler and his types say that the SEC is there to protect investors, and they regularly warn about the risks of investing in crypto. But in a year where every major crypto asset soared to new highs, the biggest risk of all was taking anything Gensler said seriously.
Who is Liz Warren? Ask most people outside of the U.S., and they’ll likely struggle to identify her. But while the Massachusetts Senator is better known in the States, she’s proven herself to be irrelevant with her consistent bad takes on government policy and the economy. One of her biggest gripes is with cryptocurrencies. Warren has used her position throughout the year to warn of the supposed risks of crypto, listing a familiar list of cliches including vague environmental claims, the supposed threat the asset class could pose to the dollar, and the now-legendary “shadowy super coders” line that became an ironic meme mocking her out of touch tendencies. So back to the question: who is Liz Warren? She’s the kind of career politician that enjoys rising to a position of power to assert her authority, but her failure to understand where the world is heading proves that she is not cut out for the job. The sooner she disappears, the better off everyone will be–especially the crypto industry.
Scott Melker calls himself “The Wolf Of All Streets,” which should immediately raise alarm bells. A former EDM DJ turned crypto trader, Melker has made a fortune from trading Bitcoin, Ethereum, and other assets. Over the years, he’s been very active in sharing all of the knowledge he’s picked up on his social channels and podcast series, which might explain why he’s one of the most followed personalities in the space. Despite his success, Melker is a case in point that money is never enough for some people. On several occasions, he was found to have alerted his followers to an asset with low liquidity, only for the price to surge then dump almost as quickly as it rose. He then deleted his tweets promoting the assets, likely in an attempt to cover his tracks. Melker tearfully denied any wrongdoing on a Twitter spaces call when many members of the community rallied against him in May, and he’s kept a relatively low profile since. Given the awful returns some of the low caps he shilled have performed on a long-term time horizon, it’s safe to assume that’s a good thing.
It’s not Ric Burton’s fixation on Silicon Valley being the epicenter of the earth we take issue with, nor his attention seeking Twitter posts about run-ins with burglars, or even Fei, the algorithmic stablecoin project that turned into a disaster partly under his leadership this year. No, it’s rather his arrogant tone that’s manifested in a series of abhorrent racist Twitter posts on a regular basis. Burton has called out people from Greece, Ukraine, and even his home country (England, not the U.S.) over the years, but the most shocking moment came earlier this month when he said that he couldn’t wait for “the Arab culture to die out.” Burton then insulted Islam and the cultural practice of women wearing burkas, hijabs, and niqabs, referring to them as “cloth bags.” He was slammed for his ignorant comments but instead chose to double down on his stance, losing the respect of many in the industry in one fell swoop. Burton argued that he was referring to the injustices and subjugation women suffer in many areas of the Middle East, but his failure to address nuance resulted in an outpouring of offensive racial slurs. Burton was another difficult addition to this list because of the good things he’s done for the space–he’s made efforts to advance Ethereum by developing a digital wallet, and has funded young entrants for Ethereum conferences and ENS domains as recently as this month. Still, racism needs to be called out to educate the perpetrators on why their views are unacceptable. Hopefully, he can learn to change with time.
This year saw the emergence of several new types of crypto personality, including the first wave of NFT influencers. Few would argue that some of the most popular NFT thought leaders are less sophisticated than their DeFi counterparts, and it’s easy to see that a lot of them entered crypto this year in hopes of cashing in on the boom. Perhaps the most insufferable of the bunch was Art Chick, a pseudonymous collector who poses as a crypto native who made their riches from placing the right calls on several JPEGs. Art Chick likes to use their pseudonymity to their advantage; in the past they’ve blackmailed projects in an attempt to secure a handout, and it’s thought that they may even be a geeky male boomer rather than the young, hip female art fan they present themselves as. Alongside dog coins, the NFT space may have onboarded more people to crypto than any other niche this year, which allowed influencers like Art Chick to prey on vulnerable investors. On multiple occasions, they’ve been accused of rugging projects, but the high speed NFTs move at means people tend to have short memory. With any luck, we’ll be hearing less of Art Chick in 2022–though NFTs may need to cool down for that to happen first.
Disclosure: At the time of writing, the author of this feature owned ETH, ENS, DYDX, SNX, and several other cryptocurrencies.