One thousand bitcoins offered to test the app. Brian Armstrong, co-founder and CEO of Coinbase, told The Wolf Of All Streets podcast how he found his very first users in 2012. Anyone who agreed to try his app walked away with an entire bitcoin, which then traded for around $5 to $10.
At this price, a thousand tokens represented at most $10,000. The same package would weigh around a hundred million today, for those who have not touched it.
Key Points
Brian Armstrong says he sent an entire bitcoin to about 1,000 people to test Coinbase, when he said the unit was worth $5 to $10
At this price, the operation costs $5,000 to $10,000; he does not give an official budget
Recipients contacted him years later to tell him their gift was worth $60,000 to $100,000.
Washington now retains around 200,000 seized BTC; a decree of March 2025 prohibits the resale of those paid into the strategic reserve
Coinbase and the 1,000 bitcoins distributed to the first testers
In 2012, Coinbase held in an apartment and a promotion of the Y Combinator accelerator. Brian Armstrong coded the first version of the application alone before Fred Ehrsam, a former Goldman Sachs trader, joined him as co-founder. The product works, just one thing is missing: people to send and receive bitcoins.
The boss of Coinbase therefore resolved the issue at the source. He says he offered a whole bitcoin to anyone who agreed to install the application, “probably” to a thousand people. This is not an audited register, it is his memory at the microphone of Scott Melker. For the 5 to 10 dollars he advances, the expense falls between 5,000 and 10,000 dollars. However, at several tens of thousands of dollars per BTC, this changes the situation.
There was nothing extravagant about the practice then. Gavin Andresen, future maintainer of the Bitcoin code, opened a faucet in 2010 which sent 5 BTC to each curious visitor, and nearly 20,000 bitcoins left this way. Coinbase also, at the same time, sent fractions of bitcoin by email and set up sponsorships at 0.10 BTC: the gift of the entire bitcoin was not the only leverage.
Several recipients came back to Brian Armstrong years later to tell him what their gift was worth, $60,000 or $100,000 depending on the date of their message. Union Square Ventures had meanwhile led a $5 million funding round in May 2013, then the largest round raised by a bitcoin company.
From 2012 skepticism to Bitcoin's strategic reserve
However, none of this seemed obvious at the time. Brian Armstrong says that very few people took crypto seriously in its early days, and that he would have had a hard time imagining the current situation.
Fourteen years later, the United States manages a strategic reserve of bitcoins. Donald Trump signed the founding decree on March 6, 2025 (which we recall prohibits the sale of BTC paid into this reserve and plans to fund it through judicial confiscations). On-chain counts and official estimates place the federal stock around 200,000 BTC, without a consolidated public audit. The bulk comes from seizures, including Silk Road and the Bitfinex hack.
Coinbase has followed a comparable trajectory. The company entered the S&P 500 in May 2025, four years after its direct listing on Nasdaq. No crypto company had yet joined the US equity benchmark.
The first thousand Coinbase customers were therefore, according to its CEO, paid around ten dollars to try software that no one was asking for. Those who never touched their balance saw their stake multiplied by several thousand, provided they kept the keys to their wallet.
