On Whales, Building a Market, and the Insidiousness of Patriarchy

This past week, we had one of the crazier incidences we’ve had since I founded Seeds 8 years ago.

Out of seemingly nowhere, a whale - someone with millions of SEEDS, a huge amount relative to market size - started selling them on the decentralized market all at once, driving the price down more than 90%.

A whale in any market can decimate the price of the asset in question at any time, which is why you often don’t see wallets with huge amounts of cryptocurrency moving. The owners understand that any action they take - even a simple transfer to another wallet - could disrupt the overall market price.

The SEEDS whale wreaked havoc on our fledgling market on a Sunday, the one day of the week I do my best to be disciplined about staying completely offline. I wasn’t aware of what was going on until I saw a lot of messages - some frantic - the next day. Almost all of them were via the Discord for our ongoing course, Cryptocurrency & How to Trade It.

My teammate Michael did his best to assuage fears there, restating the fundamentals we had learned in the core modules of our course: for folks who aren’t full-time Day Traders (and to some extent, for those who are as well), so long as you haven’t invested more than you were okay to lose, and you believe a crypto project is of good quality, heading up long term, pullbacks - even and especially enormous ones - are the best opportunities to buy.

If those circumstances aren’t present, it probably isn’t a trade that should have been made in the first place.

Meanwhile, I did my best to reply to emails sent to me by members of our community verging from confused to straight freaked, while doing a bit of blockchain investigation into the transactions themselves, to see what information I could glean.

Who was the whale? Was it some nefarious actor who had managed to exploit a vulnerability on Uniswap? Why were they doing this now, of all times?

Seeds the organization has custody of about 95% of SEEDS the cryptocurrency (one billion of which were minted all at once, in 2017). We distribute them to people who have contributed to growing our ecosystem, and in practice, this is most frequently those who have made gifts to people in need.

When someone gives to another person who has redeemed one SEED to ask for help, we send them a commensurate value or greater in SEEDS. For example, if someone makes a one-time gift of $25 USD, we’ll send them $25 USD worth of SEEDS to thank them, at current market price at the moment they made their gift.

When someone chooses to make a recurring gift, we’ll send them up to 135% of their gift amount in SEEDS as an expression of gratitude.

We do this because we want giving people to be the ones who become wealthy when and if SEEDS go up in price. We believe that when the generous people are also wealthy, they will create a better world.

Other crypto projects that also minted tokens, rather than requiring mining, have chosen more dramatic and immediate methods of distribution - typically what’s called airdropping, often to wallets that have no association with the project, and no emotional investment in its mission and success.

In one extremely notable case, a variant on the model was a stroke of brilliance - the surprise UNI airdrop initiated last fall.

Every wallet that had ever called Uniswap’s contract - even if the transaction in question had ultimately failed - was awarded at least 400 UNI, claimable by visiting Uniswap’s site. Wallets that had staked tokens received even more.

UNI has since crested $30 USD, though the token itself has no utility beyond that of any basic ERC-20. It even trades on mainstream platforms like Coinbase, very likely because Coinbase is an investor in Uniswap.

As the platform itself has become more and more successful, UNI the cryptocurrency seems to be behaving more like a traditional stock.

My investigation into case of the mysterious whale who had demolished the market price of SEEDS continued.

We knew just about every person who held a relatively large amount of SEEDS, and because of the transparency of the blockchain and tools like Ethplorer, we could doublecheck to see which wallets might have made a big move.

But at first glance, the wallet address that had executed these trades wasn’t even that of a SEEDS holder. What was going on?

**

Meanwhile, in our course Discord, one particular student sent messages that were more aggressive and accusing than others we’d seen. It was a natural response to see a huge market drop and feel afraid, particularly as a newer trader, and I thought my teammate Michael handled things well in responding to them in a balanced manner. But nevertheless, there still seemed to be some unarticulated energetic strand at play.

Though Michael invited this student to say more about what was bothering them, they declined to share specifics, and when I stepped in later to invite further discussion and repair, the student continued in the same vein - generally upset, citing that they felt “unheard” and “gaslit,” but not willing to identify what exactly made them feel that way, even as I encouraged the conversation multiple times.

It wasn’t until I was in bed that night that a jolt of insight hit - the student seemed to think we were ripping them off and lying about it. Before that moment, a lack of trust being the root of the problem hadn’t occurred to me.

The next day, Tuesday, we saw that another person had disputed a recent gift they had made with a card to help people in need through Seeds - the first time we had ever had this happen.

This person had reached out to us with an interest in making a gift after another student in our course had told him glowing, kind things about the work we were doing (according to what he shared with us).

But later, after this event, he told the credit card company that he had never received a product from us…though what he had done was make a gift, and he had promptly received SEEDS in thanks at a value significantly higher than what he had given. What he told the credit card company was untrue.

Needless to say, it was a bit of a mess, and something I found interesting (and also deeply disheartening) was that though our community is comprised of people with a lot of feminine energy - many of whom are also female - it was those with more masculine energy who went on a sort of attack, even to the extent that one felt justified about lying to an institution in order to do so.

**

Finally, after more sleuthing, I was able to uncover the culprit whale: a wallet that had been obscured by an intermediary for reasons I’m still not clear on (maybe 1inch was used to execute the sale, and this was part of their meta-DEX design?). The wallet had been in the possession of my uncle, Dr. J Ward Thornhill.

Back when SEEDS were worth a fraction of a penny, Uncle Ward had given $600 toward a Request for Help made by me, to help me pay my rent when I couldn’t afford to do so otherwise.

Though I had forgotten this until this incident compelled me to reread our old emails, Uncle Ward’s gift was what had inspired me to create our giving model, rewarding those who give with at least a commensurate value of SEEDS in thanks. At the time he gave, $600 USD was worth 10 million SEEDS on the decentralized market.

Owning 10 million SEEDS also made him the largest holder outside of our immediate organization.

Ward is a retired physicist living outside of Baltimore, and he had lost his wife, my aunt Susan, late last year. I gave him a call to ask him about what was happening - had someone stolen his private keys? - and learned that his son, my cousin David, had urged him to sell now because ETH was on its way back up to all-time highs.

Ward had apparently told his kids he’d give them this money, and he just wanted to get USD in their hands to help them out “in case he wasn’t around.” His intentions were good.

Also notably, Uniswap doesn’t show price charts on their Swap page. He didn’t realize he was obliterating the SEEDS market price at large.

**

What was cool was that our community took action. Seeds doesn’t have a ton of money behind it and never did, and the misogyny that created that situation - 2.2% of venture capital dollars went to female-founded startups in 2018 - is a huge driver behind why Seeds has taken the shape that it has, because I believe the OS of the old system is not only patriarchy, but a structure that overvalues masculine energies, and denigrates feminine ones, in humans of all genders.

I want to render that old, discriminatory model obsolete through usage of a better system, grounded in giving, like the one we have created.

So it wasn’t as though we had deep reserves that could be used to stabilize the price after the drop, and I wasn’t even sure if it felt ethically okay to do that even if we had.

But though our market is still small, wallets we both knew and didn’t recognize were buying, and folks made gifts through our platform as well, with an awareness that in giving when the market price had dropped, they would be killing two birds with one stone: helping those in need, and also benefiting themselves if and when the market bounced.

However, the vulnerabilities that this unexpected event exposed were telling, and provided valuable lessons.

Misogyny is one issue that can contribute to mistrust, but what I sensed going on for the student in particular, was something I’ve taken to calling ‘misofem’ - the denigration of feminine energy in humans of all genders.

I was reminded of the data that shows that female CEOS are 45% more likely to be fired, even when their companies are thriving. I recalled the trading firm that fired me - one of only 2 female traders of hundreds - first, back in mid-2009, though I had made the company about $840K in profits in 10 months, eclipsing that of many, if not most, of my male counterparts. I went into the meeting believing that I was being promoted.

This energy obviously needs to heal, so that it stops hindering good missions full of feminine energy that are working to transcend what’s failing us.

The path that Seeds has taken has not been perfect - this was only the latest of numerous challenges we’ve faced - but Seeds would be a lot further along by this point if I had received even, say, 1/4 of the support of the average male founder who wasn’t as smart as I had demonstrated myself to be, who had less data to show.

This discrimination extends to getting a cryptocurrency on a centralized market like Kraken or Binance or Coinbase, and even on an informational site like CoinMarketCap. They’re all centralized, and to an alarming extent, still managed by the same gatekeepers that, to my knowledge, are 100% male.

Decentralized exchanges like Uniswap are so exciting to me because they almost eliminate this problem - anyone can build a marketplace on these platforms with the help of their community, and get paid for doing so. And this is the path that Seeds has had to take.

In a very direct sense, our market is smaller - and therefore more susceptible to an unexpected event like this - because both misogyny and misofem had resulted in my receiving less support as the female founder of an ecosystem that provides nurturance…and to top it off, in some crypto-sector variety of victim-blaming, unhealthy masculine energy attacked me for this.

This makes me furious, and it feels essential to vocally set boundaries around this.

***

Though he certainly didn’t have to, once I explained the impact of what had happened, my uncle offered to convert as much USD as he could back into ETH on the centralized market (he was on the hook for a substantial capital gains payment because he had already converted the cryptocurrency into USD, so in some sense, the US government is the real winner here) and send it to us to put back into the SEEDS decentralized market, which we’re now doing.

These events have spurred us to launch an effort to get 10 million SEEDS staked by September of this year. The bigger our market is, and the stronger the community behind it, the greater our ability to weather anything.

If you’d like to be part of this work to bring a healthier balance of feminine energy to our economic systems, you’re always very welcome to give to those in need to receive SEEDS in thanks. You can then stake your SEEDS on Uniswap, providing financial access to people around the world without bank accounts, and earning a passive income in doing so.

This staking demonstration video walks through how, and we’re very happy to answer any questions.

I’ll continue working to process this experience and these emotions, with the hope that in understanding and articulating them well enough, I can shift the world, so that other people no longer suffer from similar experiences.

-Rachel