DOJ emails show Coinbase co-founder discussed meeting Jeffrey Epstein during 2014 investment talks

Newly unsealed Justice Department documents reveal that Coinbase co-founder Fred Ehrsam was involved in emails regarding a $3 million investment from Jeffrey Epstein in 2014, long after Epstein’s initial conviction.

While Epstein’s stake was less than 1% and he held no governance role, the records show Ehrsam expressed interest in a meeting during the funding round.

The files show that Epstein’s team had direct communication with Ehrsam, a member of the Coinbase Board of Directors and co-founder, who discussed a possible meeting in New York related to a $3 million investment.

“I have a gap between noon and 3 PM today, but again, not crucial for me, but would be nice to meet him if convenient. Is it important for him?” Ehrsam wrote in an email chain that included representatives from crypto entrepreneur Brock Pierce’s VC firm, Blockchain Capital. In the same thread, another email states that Epstein was “in a full afternoon board meeting yesterday.”

Coinbase did not return a request for comment.

In an email dated Dec. 2, 2014, Pierce — the child actor turned entrepreneur who later co-founded Block.one, which in turn launched CoinDesk parent Bullish Global in 2021 — contacted Epstein about an opportunity to invest in Coinbase’s Series C fundraising round.

Pierce, who also co-founded Tether and reportedly had a lengthy relationship with Epstein, wrote, “On another diligence call with the co-founder. First close happened today. Round should be fully committed by Wednesday. $12M / 20% of the round can be taken. This is the most platinum-plated deal in the space.”

That same day, Epstein sought advice from LinkedIn co-founder Reid Hoffman on whether to participate in the round. Hoffman replied that he did not have deep insight into Coinbase and advised against participating, writing, “I probably wouldn’t play.”

But Epstein ended up investing in the company separately from Blockchain Capital.

Emails from Blockchain Capital co-founder W. Bradford Stephens dated Dec. 3, 2014, state that Blockchain Capital intended to invest approximately $3.25 million in Coinbase, spread across three affiliated entities.

Within the same email chain, Epstein’s longtime associate Darren Indyke identified the investing entity as “IGO Company, LLC, which is a USVI limited liability company.”

A valuation report dated Dec. 31, 2014, included in the DOJ release lists a transaction described as “Purchase of Coinbase via IGO LLC (3,001,000),” and lists Coinbase as an investment held through IGO LLC in that amount.

‘Opportunity to invest’

As more businesses and individuals named in the Epstein documents have sought to distance themselves from him, legal and reputational risk has become a key concern. In 2023, JPMorgan Chase and Deutsche Bank paid a combined $365 million to settle lawsuits brought by Epstein’s victims, who alleged the banks enabled his sex-trafficking operation by providing financial services.

Against that backdrop, Blockchain Capital, which is widely referenced in the documents, said the original fund investment was never completed.

Blockchain Capital did not respond to a CoinDesk request for comment, but in an emailed statement to Decrypt, a representative said, “In 2014, Brock Pierce was in contact with Mr. Epstein in relation to fundraising. As part of those discussions, an opportunity to invest in Coinbase’s Series C was also discussed via email.”

The representative added that a fund investment “was never consummated,” and that Epstein instead invested independently through IGO Company LLC.

However, a few years later, Blockchain Capital attempted to buy Epstein’s stake in the crypto exchange.

In January 2018, Blockchain Capital initiated discussions with Epstein’s associate, Indyke, about purchasing the Coinbase position held through the LLC. “We would be willing to buy the position from you at a $2b [billion] valuation,” Stephens wrote, adding that Blockchain Capital would pay roughly $15 million for the stake.

Later emails show negotiations focused on selling half of the Coinbase position held in IGO LLC. Indyke wrote that Epstein believed the company’s value exceeded $3 billion and that he had received “two other bids” for the stake.

On Jan. 31, 2018, Stephens responded that Blockchain Capital’s offer to buy 50% of the position at a $4 billion valuation remained open.

“The price for the 50% interest is $14,666,667,” Stephens wrote, a price that would imply a gain of more than $11 million on the portion of the Coinbase stake sold, according to the emails. In a Feb. 1, 2018 email, Indyke confirmed agreement to the transaction, writing, “Jeffrey agrees that he will sell you 50% of his LLC.”

A valuation report dated Aug. 31, 2018, said Epstein had sold half of his Coinbase stake, saying “50% sold for $15mm [million] Feb 2018.”

Epstein was arrested on federal sex trafficking charges on July 6, 2019, and was held at the Metropolitan Correctional Center in New York City. He died by alleged suicide on Aug. 10, 2019, after being found unresponsive in his cell.