Photo Olivier Stern at his house in Montreuil, outside Paris. Mr. Stern has invested a third of his life savings in a start-up called the Decentralized Autonomous Organization. Olivier Stern, a 31-year-old French socialist with an appetite for risk, recently invested a third of his life savings — 10,000 euros, about $11,000 — in a cryptocurrency start-up that has no legal standing and runs head-on into regulatory obstacles, yet might very well upend the mysterious world of virtual investing.
The start-up, a sort of venture capital fund that calls itself t he Decentralized Autonomous Organization , has essentially come out of nowhere in the last month and attracted about $152 million, at last count, from investors around the world like Mr. Stern — making it the most successful crowdfunded venture ever, by a significant margin.
The venture, like so many things related to the digital currencies that cryptographers are creating on the Internet, is difficult to describe, and it may not be legal. But thousands of mostly anonymous investors have already heard about it through word of mouth and sent money — in the form of Ether, a freshly coded form of currency that has held itself out as a new and improved version of Bitcoin , the most popular virtual scrip.
For these investors, in some sense it is the digital equivalent of buying into a bakery with no baker, no menu and no assurance that the ovens will even be delivered. But among the crowd that has invested, faith in the computer code that governs the project appears strong enough to override all those concerns.
After it collects Ether from investors — the deadline to buy in is May 28 — the D.A.O. aims to put the money into other digital currency start-ups. The investing decisions are to be made through […]
