‘I wanted to be part of the eco-system’: From FBI to Cryptocurrency King

Everyone who is old enough knows where they were on 9/11. Curtis Ting was 13 in 2001 and living in Vancouver, where his father (now a psychiatrist) was studying theology. “The attack on the Twin Towers inspired me to want to do something for national security,” he says. Now he has gone from guarding the nation as an investigator for the FBI to vanquishing cybercrime from the hallowed halls of Bitcoin as managing director, Europe, of Kraken, one of the world’s largest cryptocurrency exchanges.

Ting was born in Seattle to Taiwanese-American parents. When he went to a college in Washington DC to study strategic intelligence, he found that his professors were former G-men. “They tried to put me off,” he says, but he went ahead and interned at the FBI straight after graduation and then went full time. “The expectation among Asian-Americans is that you become a doctor or a dentist or a lawyer, giving back to your local community. They’re not that prevalent in government. This was my act of youthful rebellion – to join national security.”

He spent 10 years with the Bureau. There are various things I’m not allowed to say about Curtis Ting, lest I trigger a drama. I can’t even use the word… ah, but I’m not allowed to use that word. Suffice to say that Ting rose rapidly through the ranks. He stresses that the FBI is nothing like the Hollywood fantasy. Unlike, say, Kevin Costner or Sean Connery (in The Untouchables) he didn’t generally pull out a machine gun or shotgun and start blasting. “If you want to put bad guys away, you have to do things by the book,” he says. You have to build your case slowly and surely and “evidentiary preservation” is critical. “There’s a lot of paperwork,” he says.

In the era of maximum Al-Qaeda penetration and the rise of offshoots like Boko Haram, Ting was working mainly on counter-terrorism. But a lot of his forensic work involved following the money and he was inevitably drawn into cybercrime, or rather into the battle against it. Ting acknowledges that Bitcoin used to be tremendously popular among criminals of all stripes. “Crime and new tech are virtually synonymous,” he says. “Crime finds a use for new tech first, before it goes mainstream. And then we [the FBI] try to make it less attractive to criminals.”

Ting became a “presidential daily briefer”, acting as liaison between the director of the FBI and the US attorney general. When, in 2014, the FBI shut down the “Silk Road” black market (the Amazon of illegal substances) on the dark web, where Bitcoin was the currency of choice, the attorney general asked Ting a direct question: “What IS Bitcoin?” “If I knew then what I know now,” says Ting, “I could have given him a much better answer.”

The association with crime “gave Bitcoin a bad name at the start”, says Ting. Street gangs used to try to “layer” their ill-gotten gains by having mules go from ATM to ATM to deposit relatively small amounts of cash. They switched to Bitcoin to evade surveillance. The irony is that they thereby became trackable, because, as Ting points out, “Bitcoin is the realm of truth”: blockchain technology insists on a history of transparent, public transactions. “With blockchain, you can’t hide,” says Ting. “Fraud becomes much harder. They should have stuck with cash.”

In 2016 Ting was based at the US embassy in Paris and he happened to wander past the nearby offices of Ledger, the crypto assets storage provider. Intrigued, he went in, introduced himself, and ended up buying Bitcoin and Ethereum that very night. “I felt I needed some skin in the game,” says Ting. It was the beginning of his transition to the realm of cryptocurrency.

Like all markets, but probably more so in this case, crypto is volatile. “I don’t track what the currencies are doing day by day – I’d never sleep,” says Ting. He explains that there are two ways of looking at crypto assets, Bitcoin or other “alt-coins”: one, as a form of speculative investment, but secondly “as a representation of something bigger”, what Ting calls “a revolution in the financial eco-system”, distributed, globally connected, transcending the old system of highly centralised national currencies.

Ting was frustrated at how long crypto-related cases were taking. He thought the cryptocurrencies could do with more law-enforcement people to improve their service. “I wanted to be part of the eco-system,” says Ting. He joined Kraken in 2018, working in the realm of “compliance”. “If I was an investigator on the outside looking in, it would take me years to do things that the industry can do in a week or a day.”

In 2019 he was investigating the collapse of Quadriga, another currency exchange, whose founder had been running a Ponzi scheme (and then either died or vamoosed), and trying to work out what had become of all the Bitcoin. The CEO of Kraken said to him that Quadriga makes the whole industry look bad – and duly posted a six-figure reward for further information. The FBI and Kraken, they discovered, had common interests.

I need to stress one thing here: this is not a case of gamekeeper turning poacher or going over to the dark side. The realm of alt-coins is not a lawless Wild West. Ting says that Kraken “prides itself on working with regulators”. The new digital reality is so-called “smart regulation”, which means that crypto sticks to certain rules, just not the same rules made up in the early twentieth century to regulate fiat currencies. Ting argues that there is increasing convergence between conventional financial services and the crypto sphere, as evidenced by central banks’ interest in issuing their own cryptocurrencies. “Crypto isn’t a threat to the system, it’s practical. The goal is to transform financial services into something that works in the digital age.”

Kraken boasts of having never been hacked and is stringent about verification. It has an instant buy/sell function and enables UK users to trade directly in sterling (Australians similarly can use AUD). And now it has an ex-FBI guy heading up its Europe division. Kraken has a staff of 1300 digital nomads scattered around the world, but most of its business is in Europe. Curtis Ting is currently “in visa purgatory” in Chicago, but poised to relocate to London whenever circumstances allow. “The prevailing narrative is that digital approximates to gold, as a form of reserve assets. If Bitcoin could be like gold in 10 or 20 years, we wouldn’t be too sad about that.”

My Bible in this field is Crypto Revolution: Bitcoin, Cryptocurrency and the Future of Money by Australian Sam Volkering, who is an investment guru at Southbank Research. Volkering recently said that crypto is “a work in progress that’s still in its infancy. There’s a chance to get in and participate in this construction phase. A phase that I believe still presents huge long-term potential for people who believe in long-term wealth creation.” Back in 2010, a guy used a few thousand Bitcoin to buy a couple of pizzas from Papa John’s: those pizzas (at the going rate) would now be worth well over £100m each.

Curtis Ting points out that there are more than 2,000 “popular blockchain projects” up and running today (and lots of less popular ones). Kraken lists over 50 of them. For anyone trying to make up their mind about investing in one or more of the cryptocurrencies, Curtis Ting says that each one “represents a different application of blockchain technology”. He adds a word of warning: “It’s inherently open-sourced, so it’s hard to see what is going to endure and what isn’t.”

@andymartinink