An article recently appearing in The New Yorker magazine entitled Pumpers, Dumpers, and Shills: The Skycoin Saga , which is ostensibly an in-depth expose of the hype and hijinks employed by a crypto company founder to promote his project's token, leaves more questions than answers. The first question that comes to mind is, why did it take its author, Morgan Peck, over two full years to publish the article after interviewing her main source, Bradford Stephens, in 2018? And why has it appeared now? Also curious, is why the journalist chose to base her piece nearly exclusively on the account of a disgruntled contractor whose company, Smolder LLC, was only hired for a mere six weeks over two years ago.
The article begins more in the spirit of a work of fiction than of journalism, noting“On an April afternoon in 2011, a twenty-seven-year-old tech entrepreneur named Bradford Stephens arrived at a stucco bungalow near the canals of Venice, California.” It then goes on to describe celebrity-studded events, a soiree in a Vegas hotel with escorts, yacht parties, and a kidnapping plot in Shanghai – in short, all the makings of a modern spy thriller, as opposed to a serious piece of investigative journalism.
This story's protagonist, Bradford Stephens, is portrayed as the hero of a detective novel who slowly discovers that he has been contracted by a company involved in shady dealings and tries to warn potential victims. Reading Peck's 30-page tome, you could be forgiven for thinking that Stephens had been a key player in the company since its founding in 2013, when in fact he was only briefly engaged by Skycoin in 2018.
In fact, Stephen's company, Smolder LLC, was hired in January of that year to do marketing and business development with its first engagement at the CoinAgenda conference in Las Vegas. In the article, Stephens says he had been tasked by Skycoin's founder, Brandon Smietana, with entertaining executives from prominent cryptocurrency exchange Binance to encourage them to add Skycoin to their listings. He claims he spent approximately $80,000 to this end by organizing“an exclusive VIP party” in a hotel suite, including steak dinners, alcohol, and prostitutes. The problem is that, by all accounts, no one except Stephens himself was invited. Not one CoinAgenda participant that Skycoin followed up with had been informed about the party or attended it. Moreover, no representatives from Binance were even at the conference.
According to Skycoin's head of events, Daken Freeborn, Skycoin had been informed by the event's organizer, Michael Terpin, a week in advance that representatives of Binance would not be in attendance, making both Peck’s and Stephen’s claims absurd. While, to her credit, Peck does occasionally include disavowals in her text, these are brief and oddly wedged into parentheses, as if not to spoil the flow of her spy novel, for example,“(A spokesperson at Binance told me that the company neither requested nor knew about the party)”.
Though Peck claims Stephens was fired from Skycoin, Bradford's own correspondence with the company shows that he resigned on February 24, 2018, less than two months after being contracted, under pressure from Skycoin's advisory board. This pressure was prompted by a bizarre meeting in February 2018, when Stephens along with his associate, Harrison Gervitz, led Smietana to a Shanghai hotel room to meet an allegedly influential marketer in a zoom call. In the meeting, this individual, who was introduced as a“secret business partner,” told Smietana that Skycoin would have to immediately pay 30 million dollars in Bitcoin in order to secure a contract with his marketing team, claiming“If you hire us, Skycoin will be a billion dollars, if not, it will go to zero.” It was later suspected that the person behind the zoom call was Ryan Eagle, an infamous associate of Gervitz, who was named in a US Government FTC action concerning fraud in 2014 and 2016.
Consequently, over half of Skycoin's advisory board threatened to quit unless Stephens left the company, as its members were afraid that their names would be associated with Eagle Web Assets (EWA) and Harrison Gervitz. This is understandable, as Gervitz, aka Harro, is widely considered to be the king of the blackhat marketing criminal underworld, while Smolder's other partners, Ryan Eagle and Adam Young, were operators in Eagle Web Assets, a company under a court order (FTC v. Eagle Web Assets) for illegal marketing practices.
Another question prompted by Peck's article is, what has happened to the editorial standards of The New Yorker and its employees, particularly those of Anna Boots, who was tasked with fact-checking the article. Besides stretching and spinning the truth to accord with the tone of the story, in many cases, the article appears to contain outright lies.
A robbery, in which Smietana and his girlfriend were held hostage in Shanghai, is described as the result of a minor disagreement with the company's marketing team. Peck asserts that the perpetrators were never arrested, and only detained, but it is a matter of public record that the criminals were, in fact, arrested and served jail time for kidnapping. Anna Boots approved this statement knowing it was false.
The New Yorker article also claimed that Stephens had made secret recordings of Smietana gloating about feminizing the population to make it more docile and easier to control. During fact-checking, Smietana contested this wild allegation and requested the recording, but The New Yorker failed to respond or substantiate these allegations.
In fact, blockchain thought leader and media veteran Michael Terpin, who was interviewed for the article and is also one of its subjects, stated after reading it,“Why did they need to hire a fact-checker if they were just going to lie? I told her [Peck] I didn’t find Bradford to be credible and I reinforced that with the fact-checker [Boots].” Terpin reiterated to Peck and Boots multiple times that Stephens was not credible yet this didn’t sway the authors from including these absurd allegations.
The fact that The New Yorker actually did publish these statements knowing they were untrue appears to fit a recent pattern in the mainstream media, which often attempts to cast fear, uncertainty, and doubt towards the world of blockchain and digital currencies. In fact, the last part of the article makes a point of giving a rundown of recent SEC actions against ICO operators and cryptocurrency companies, wrapping up with a quote from a lawyer specializing in cryptocurrency fraud, who says“Yesterday's crypto heroes are tomorrow's crypto felons.”
All this makes one wonder just what the agenda behind this article was and why it has appeared now. Was it meant to be an accurate portrayal of the world of cryptocurrency companies, or a sensationalized hit-piece meant to scare readers away from digital currencies, which are increasingly frowned upon by governments and squeezed by regulatory authorities?
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