Morning Minute: Epstein Was an Early Coinbase Investor

Morning Minute is a daily newsletter written by Tyler Warner. The analysis and opinions expressed are his own and do not necessarily reflect those of Decrypt. Subscribe to the Morning Minute on Substack.

GM!

Today’s top news:

• Crypto majors chop on the day; BTC holds at $78k
• Hyperliquid soars 17% after debuting outcome markets
• Epstein revealed to be an early investor in Coinbase via recent files
• XAI and SpaceX announce merger; xAI to hire “crypto experts”
• Lighter announced its Lighter EVM with Axiom

🔴 Jeffrey Epstein Was an Early Investor in Coinbase

The Epstein files just dropped.

And buried in the 3 million documents was a crypto-related bombshell.

📌 What Happened

Newly released emails from the Department of Justice reveal that convicted sex offender Jeffrey Epstein made a $3M investment into Coinbase in December 2014.

The deal was arranged by Tether co-founder Brock Pierce and his firm Blockchain Capital at a $400M valuation. Today, Coinbase is worth roughly $51 billion.

Coinbase co-founder Fred Ehrsam appears to have been aware of who was behind the investment. In an email dated December 3, 2014, Ehrsam wrote asking to meet with Epstein in New York.

“I have a gap between noon and 3pm today, but again, not crucial for me, but would be nice to meet him if convenient,” Ehrsam wrote.

Coinbase’s wire details were immediately shared after Blockchain Capital confirmed the investment could proceed, ultimately reaching Epstein’s executive assistant Darren Indyke.

The investment came more than six years after Epstein’s 2008 conviction for procuring a child for prostitution.

Epstein cashed out half his stake in 2018 for nearly $15M (from an initial $1.5M allocation), and appears to have retained the other half until his death in 2019.

🗣️ What They’re Saying

Neither Coinbase, Ehrsam, Brock Pierce, nor Blockchain Capital have publicly commented on the revelations.

Reid Hoffman, LinkedIn’s founder, was also looped into Epstein’s crypto interest. When Epstein asked Hoffman “how hard” to go on the Coinbase round, Hoffman replied: “I probably wouldn’t play.”

🧠 Why It Matters

Let’s be clear about what this is and what it isn’t.

This doesn’t mean Coinbase did anything illegal. Taking money from a convicted felon isn’t a crime.

And the investment happened over a decade ago, when crypto was still a Wild West of funding sources and due diligence was, let’s say, evolving.

But it does raise questions about the industry’s early days and the people who bankrolled its most important companies.

A few things stand out:

1. The timing. Epstein invested six years after his conviction. By 2014, his status as a registered sex offender was public knowledge. The emails suggest Coinbase leadership was aware of who they were dealing with.
2. The network. Brock Pierce, now best known as Tether’s co-founder, brokered the deal. Other Epstein files show he was CC’d on early crypto discussions about Ripple, Stellar, and Bitcoin’s scaling debates. He claimed to have spoken with “the founders of Bitcoin.”
3. The return. A $3M investment at a $400M valuation in what became a $51B company is a 125x+ return. Epstein’s estate likely still holds exposure to Coinbase.

This story won’t derail Coinbase.

But it does remind us that crypto’s “move fast and break things” era came with trade-offs.

Due diligence wasn’t always a priority. And some of the industry’s biggest winners were funded by people who, in hindsight, probably should have been shown the door.

Now the industry has to reckon with that history in public.

🌎 Macro Crypto and Markets

A few headlines that stood out:

• Crypto majors are flat on the day; BTC even at $78.1K; ETH -1% at $2,290; SOL -1% at $103; XRP -2% at ~$1.60
• STX (+20%), HYPE (+17%) and Polygon (+12%) led top movers
• Elon announced that xAI and SpaceX will officially merge and are valued at $1.25T; xAI reportedly hiring crypto experts to teach AI how to trade
• Stablecoin volumes passed $10T last month, including $8.6T for USDC
• Crypto stocks fell hard with bitcoin under $80K; Coinbase, Strategy, and Robinhood all posting sizable losses Monday
• Opera stock jumped 15%+ after adding USDT and Tether Gold support to its MiniPay wallet; now has 12.6M activated wallets processing $153M+ monthly
• GameStop CEO Ryan Cohen announced plans for a “very, very, very big” consumer company acquisition he called “way more compelling than bitcoin”
• JPMorgan’s 2026 Family Office Report shows 89% of family offices have zero crypto exposure despite headlines and hype; only 17% plan to invest in digital assets going forward
• Bed Bath & Beyond announced it’s acquiring Tokens.com to build a tokenized real estate platform with Figure Technologies
• Vitalik Buterin revealed he made $70K on Polymarket in 2025 by betting against extreme market sentiment; says the strategy “usually makes money”

In Corporate Treasuries / ETFs

• Bitcoin and Ethereum ETFs shed $1.7B in weekly outflows last week, wiping out 2025 inflows entirely; though the BTC ETFs did see $562M in net inflows yesterday
• Strategy added 855 BTC for $75.3M last week at an average of $87,974; total holdings now 713,502 BTC at $76,052 avg; position essentially breakeven
• MSTR shares are down 7%+ in premarket to multi-year lows around $139
• Tom Lee’s BitMine added another $96M in ETH last week; now holds 4.28M ETH (~3.5% of supply) with $6B+ in unrealized losses

In Memes / Onchain Movers

• Meme majors are bleeding; DOGE -X%, SHIB -X%, PEPE -X%, TRUMP -X%, FARTCOIN -X%
• Notable movers: Goyim (+300%), BIRB (+37%), Mystic (+80%) and 1 (+30%)

💰 Token, Airdrop & Protocol Tracker

• Hyperliquid unveiled HIP-4 to add “outcome trading” for prediction markets and options-style derivatives (HYPE +17%)
• Lighter announced LighterEVM, now allowing general purpose apps to compose with their markets
• BIRB shot up over 100% to $400M+ fdv after being listed on Upbit

🚚 What is happening in NFTs?

• NFT leaders were green; Punks +1% at 27.5 ETH, Pudgy +5% at 4.35 ETH, BAYC +4% at 5.36 ETH; Hypurr’s +5% at 542 HYPE
• Moonbirds (+15%) and Moonbirds Mythics (+20%) led notable movers
• Nifty Gateway announced it will shut down Feb 23; the Gemini-owned NFT marketplace is now in withdrawal-only mode
• Adam Weitsman acquired the 3AC Pudgy Penguin collection from Spencer