[1] https://techcrunch.com/2015/05/18/what-is-21-co-really-doing...
[2] https://techcrunch.com/2017/09/20/21-co-announces-a-token-sy...
[3] https://www.coindesk.com/meet-earn-com-21-rebrands-social-ne...
There's nothing wrong with a failed startup, but this was a poor copy of miners and mining chip producers with much less funding and in some cases bootstrapped to profitability. The only thing that set 21 apart was an amazing ability to razzle-dazzle VCs.
After failing to mine Bitcoin profitably themselves, 21 came out of stealth mode with a staggeringly stupid product: mining chips for toasters. The idea was that you would buy a toaster (or lightbulb or something) with one of 21's mining chips and it would waste energy while mining miniscule amounts of Bitcoin. This was ridiculous on its face, since the amount of Bitcoin that could be mined on these chips was far less than you could simply buy for the cost of the electricity (not to mention the chip itself). Also, this amount was too small to even be transferred, given Bitcoin's transaction fees!
I'm not exaggerating, this product was never, and could never be viable. Still Balaji was able to razzle-dazzle the tech press into trumpeting it as some sort of innovation.
Once this failed, they re-branded as Earn.com and started making a grab-bag of Bitcoin hackathon projects, such as paying you Bitcoins for reading spam, or answering quizzes. This was always an extremely uninspiring and ultimately non-viable product, but at least it wasn't complete vaporware.
Then Coinbase, a very successful and competent company, threw away $100 million to help 21's VCs recoup their failed investment. The only explanation that seems rational is that Balaji had some very compromising footage of Brian Armstrong at the a16z holiday party.
I'm not sure about his past career (some biotech thing), but Balaji's legacy in crypto is to waste enormous amounts of money on blatantly ridiculous boondoggles. It's unfortunate that Coinbase wasted so much time and money perpetuating this.
One addition I had to check on, which confused me at the tilt was how Balaji was so closely involved in 21 yet also a partner at Andreesen Horowitz, which I had read about their daily and weekly routine and was clearly a full time job.
Balaji went from founder to "advisor" of 21 pretty quickly, becoming a partner of a16z in the interim. After things went to shit at 21 he went back as full time CEO. Reasons for how that went down are speculative. The results are not though. The exit is real but wow is it questionable. Conflicts of interest seemingly all over the place. I don't know who else is on Coinbase's cap table but I'd love to hear their takes on the acquisition.
You can read Balaji's congratulatory take in his own words on what he did here. [0]
I also recall Balaji positioning himself for a position in the Trump administration which saw him scrub his entire twitter history. If anyone recalls more details from that episode feel free to add them.
People, keep being stupid and confident. Sometimes it pays tremendously off.
Wouldn't the device simply mine as part of a mining pool? The pool can then manage custody of the funds, similar to what NiceHash and other mining pools do. Granted, if the amount is small then it would never be withdrawn on the main chain.