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Winklevii Invest in BitInstant

“We’re definitely pretty fascinated by it. The classic issue with Bitcoin is that it’s very early days.” — Tyler Winklevoss

The WinkleVoss twins, the two Harvard graduates who sued Mark Zuckerberg over the creation of Facebook, have been getting into Bitcoins. First, it was learned that they own 1% of the Bitcoin economy, and today TechCrunch learned that the Winklevii have invested in BitInstant, a Bitcoin startup.

BitInstant, a New York City based startup that operates an online platform for buying and selling Bitcoins, has raised $1.5 million in a seed funding round led by Winklevoss Capital with the participation of other strategic investors including money services veteran David Azar. The investment was closed this past fall, but the Winklevosses are just now publicly announcing it in the lead-up to the Bitcoin Foundation’s 2013 Conference being held in Silicon Valley this weekend.

Via TechCrunch.

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Winklevii Bitcoin: They Own A Huge Stake

Facebook’s arch enemies Cameron and Tyler Winklevoss have revealed a big financial secret: they hold about 1% of the Bitcoin economy. That’s a big Winklevii Bitcoin position.

Fresh with their cash from the Facebook settlement (worth well over $200 million), the Winklevoss twins have bought up about $11 million worth of Bitcoins. That’s about 1% of all available Bitcoins.

In an interview with the New York Times, the Winklevii provided some insights on their investment:

“People say it’s a Ponzi scheme, it’s a bubble. People really don’t want to take it seriously. At some point that narrative will shift to ‘virtual currencies are here to stay.’ We’re in the early days.”

The Winklevosses say this week’s tumult is just growing pains for a digital currency that they believe will become a sort of gold for the technorati.

“We have elected to put our money and faith in a mathematical framework that is free of politics and human error,” Tyler Winklevoss said.

The Winklevosses have paid in bitcoin for the services of a Ukrainian computer programmer who has worked on their Web site.

The brothers began dabbling in Bitcoin last summer when the dollar value of a single coin was still in the single digits. To keep their holdings secure from hackers, they have taken the complex codes that represent their holdings off networked computers and saved them on small flash drives, putting the drives, in turn, in safe deposit boxes at banks in three different cities.

It’s hard to verify how the Winklevoss holdings compare with other bitcoin players, given the anonymity of accounts, and the twins say they believe that some early users of the system probably have holdings that are at least as large.

 

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