Anonymity in Crypto Raises Alarm

At work, he makes an exception to secrecy. In calls with clients, he often uses his real first name to introduce himself, fearing that traditional corporate executives would be uncomfortable working with someone known simply as Legend.

In the past year, venture capital firm Paradigm has also hired engineers and researchers who operate anonymously; they appear on the company’s website staff page under pseudonyms. The most recent hire was a crypto engineer who goes through Transmissions11 and attends high school “in his spare time,” according to his company bio. (Jim Prosser, a spokesman for Paradigm, said the employees’ bosses know their identities.)

In interviews, anonymous crypto entrepreneurs and engineers offered various reasons for concealing their names. Some feared that a regulatory crackdown would put them in the crosshairs of law enforcement. Others said they didn’t like the attention or feared their growing wealth could make them targets for thieves and hackers.

Anonymous entrepreneurs often take extreme measures to keep their identities private, using voice-altering software on calls or requiring business partners to sign non-disclosure agreements.

Some venture capitalists are willing to invest in it anyway. Last year, 0xMaki, a developer who helped run the major crypto project SushiSwap, raised $60 million of group of venture capitalists, including Ms. Wu, without revealing her real name to them. (The deal fell through after members of SushiSwap — a so-called Decentralized Autonomous Organization, or DAO, in which individual investors have significant influence — raised concerns about the funding.)

Last summer, the anonymous founder of Alchemix, another major crypto project, raised $4.9 million from a group of venture capital firms led by CMS Holdings. Dan Matuszewski, one of CMS’s founders, said he never asked the project leader, who uses the pseudonym Scoopy Trooples, to reveal his identity.

“A lot of these guys have had reputations over the years,” Mr. Matuszewski said. “It doesn’t seem like it makes much sense for them to run away and run away with the funds.”

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