One Investor’s Outsize Role in the Crypto Market

In 2013, Barry Silbert asked the board of directors at SecondMarket, a startup he founded that connected buyers and sellers of private company stock, to let him spend $3 million of the company’s cash on buying bitcoin. It had almost nothing to do with the company’s business, and not all of the board was enthusiastic. “I thought it was absolutely crazy. We argued about it,” said Lawrence Lenihan, one of the board members at the time.

Mr. Silbert persuaded them to take the plunge. That investment—worth about $200 million today—was the seed that became Digital Currency Group, a tiny spinout that has quietly become a central hub of the cryptocurrency world. A hybrid of holding company and investment firm in the mold of Berkshire Hathaway, DCG today owns stock in more cryptocurrency companies than any other investor. The New York-based company also holds hundreds of millions of dollars in digital currencies and owns influential crypto-related businesses including CoinDesk, the popular cryptocurrency trade publication and events business, and Grayscale, one of the largest managers of cryptocurrency investment funds.