Connect with us

Hi, what are you looking for?

Business

Crypto donors pay $1 mn in fees for failed US Constitution bid

Crypto donors pay $1 mn in fees for failed US Constitution bid
Security guards stand next to the first printing of the United States Constitution during an auction at Sotheby's auction house in New York - Copyright AFP Manjunath Kiran
Security guards stand next to the first printing of the United States Constitution during an auction at Sotheby's auction house in New York - Copyright AFP Manjunath Kiran

The cryptocurrency donors who banded together for a failed try to buy a rare copy of the US Constitution have had insult added to their injury in the form of over $1 million in fees, data showed Wednesday.

Over 17,400 donors joined in the headline-making effort to purchase the document at auction in New York, but people have been seeking refunds this week after losing out to a billionaire’s $43 million bid.

The crowd-funding endeavor used the digital money ether, which extracts a charge for each transaction — so donors had to pay both to pitch in and to get their money back.

Crypto prices are volatile, but as of Friday’s value the donors had collectively lost some 199.5 ether or about $850,000 to donate and another 38.4 ether or roughly $163,000 on refunds, according to Dune Analytics tracking.

The charges, which are due to the decentralized nature of the digital money, show the challenges to using crypto for routine financial transactions.

Ether calls the costs a “gas” fee, and they pay for executing the computer transactions that are essential to moving the digital money, its platform said. 

The sale from Sotheby’s last week drew lots of attention, with the auction house saying the item was one of only 13 known surviving copies of the US charter, signed on September 17, 1787 at Philadelphia’s Independence Hall by America’s founding fathers including George Washington.

– Hefty fees –

Despite the outcome, the cryptocurrency consortium ConstitutionDAO that sought the rare document sounded a positive noted on the effort.

“We made history and showed the entire world that a group of internet friends can… face a seemingly insurmountable goal and achieve incredible results on an impossible timeline,” it wrote on Twitter as the group disbanded.

But because many donors kicked in the equivalent of about $200, they took a heavy hit on gas fees that vary according to demand and are charged at a flat rate.

“Guys I love this project but you gotta figure something else out. Having people spend that much gas to reclaim makes no sense,” tweeted @nateliason.

Others were also bittersweet about the result.

“It speaks volumes that a billionaire won the US Constitution as opposed to the 17,437 people who rallied together to try and secure this monument to freedom,” tweeted @museumofcrypto. “Regardless, well-played @ConstitutionDAO.” 

Kenneth Griffin, CEO of the hedge fund Citadel in Chicago, set a world record for a historical document at auction Thursday when he purchased the 1787 text, according to Sotheby’s.

Griffin will lend his copy of the Constitution for free to the Crystal Bridges museum in Bentonville, Arkansas, which will display it without charging visitors, Sotheby’s said.

Written By

With 2,400 staff representing 100 different nationalities, AFP covers the world as a leading global news agency. AFP provides fast, comprehensive and verified coverage of the issues affecting our daily lives.

You may also like:

Life

Environment Canada has issued an unprecedented "red alert" for parts of British Columbia as the province braces for additional rain.

World

A rare joint opinion article by the ambassadors of China and Russia has sharply assailed President Joe Biden's plans for a virtual summit.

World

Seventy-one people were killed in the crash. Follmann, now 29 years old, is one of six who survived -- though he lost his right...

Life

British PM Boris Johnson announced further measures the government is taking to curb the spread of coronavirus' Omicron variant.