Of all the ways to grow rich from the cryptocurrency boom, Brian Armstrong chose perhaps the most conservative.
Nine years after founding the most popular destination in the US for cryptocurrency buyers, Coinbase, his decision is about to pay off as bitcoin reaches new peaks.
Trades between private investors have valued Coinbase at about $100bn. At those prices, the company’s direct listing on the Nasdaq exchange could convert Armstrong’s shares into a $14.8bn stake as soon as this month, without any lock-ups that would normally prevent immediate selling.
For Armstrong, a 38-year-old engineer, the windfall would vindicate his determination to make the complex and defiantly anti-establishment world of cryptocurrencies accessible to the mainstream.
Growing up in San Jose, the largest city in Silicon Valley, Armstrong began coding websites in HTML for money during the dotcom boom in the ‘90s. “Even back in high school I was that nerdy kid who was reading a book on Java,” he recalled in an interview.
At Rice University in Houston, Texas, Armstrong and a roommate created University Tutors, a site that paired college students with parents seeking extra academic help for their children. The company’s phone number connected directly to the founders’ room in their residential college, Lovett.
“If we had a party or people over or something, we would have to unplug our phones,” said John Nelson, Armstrong’s former roommate and co-founder of University Tutors.
Nelson said they also started a side hustle that booked off-campus bars for college club events, charging cover and a cut of the bar tab. “They were quite popular events.” University Tutors eventually sold to an undisclosed buyer for 21 times its revenues, said Nelson, who is now chief executive of the ecommerce start-up Vroom Delivery.
A few years after graduating with degrees in computer science and economics, Armstrong moved to Argentina, where his encounters with hyperinflation planted the seeds for an interest in supposedly inflation-proof cryptocurrencies.
In Armstrong’s telling, he first came across the white paper that explained bitcoin while home with his parents for the holidays in 2010.
His first bitcoin venture, a wallet to hold the currency on mobile phones, drew some attention in tech circles. But its mobile-only design left it unreliable and without the computing power that cloud computing companies had made cheaply available for websites.
“I had this realisation: Somebody is going to have to make a really rock-solid cloud service for this, and that is the future,” Armstrong recalled.
In 2012, he left his job at the travel rental site Airbnb, where he had worked for a brief stint on the global payments team. He…