Escape from Leviathan: Epstein, Silicon Valley, and Sovereign Individual

Original Title: "Escape from Leviathan: Epstein, Silicon Valley, and Sovereign Individual"

Original Authors: Sleepy.txt, LookAhead Beating

For the past century, the super-rich have been searching for the same thing: a place where their money can escape the scrutiny of sovereign states.

In the early 20th century, they found Swiss bank accounts.

In 1934, the Swiss Banking Act mandated bank secrecy, with leakers facing criminal prosecution. The wealthy could store their assets in an account known only to a few senior bank employees, evading their home country's taxes and legal scrutiny.

This system operated for 74 years until in 2008, the IRS issued a John Doe subpoena, demanding UBS to provide account information for about 52,000 American clients.

The following year, UBS paid a $780 million fine and disclosed some client names.

With underground vaults no longer secure, capital quickly shifted its base and flowed towards sunlit tax havens.

In the mid-20th century, offshore centers in the Caribbean began to rise. The Cayman Islands, Bermuda, the British Virgin Islands – these islands scattered across the blue ocean, with zero tax rates and lenient regulations, became paradises for multinational corporations and the wealthy to register shell companies and hide wealth.

This system operated for about 50 years until 2014, when the Organisation for Economic Co-operation and Development issued the "Common Reporting Standard," requiring global financial institutions to automatically exchange account information of non-resident clients. By 2024, over 170 million accounts were forcibly exposed, involving assets of up to €130 trillion, becoming fully visible in various countries' tax authorities' systems.

Sunlight pierced through the coconut palms of the Caribbean, illuminating those treasures in the shadows.

Every generation of offshore havens has seen its lifespan shortened. Swiss banks lasted 74 years, Caribbean offshore centers 50 years. The net of regulation is tightening, and the wealthy urgently need a new hiding place.

In August 2019, Epstein died in a Manhattan prison cell. More than the mystery of his death, his legacy seems like a specimen of an era, precisely demonstrating how the wealthy have jumped ship.

In the physical world, he owned Little Saint James Island. This island, equipped with a harbor, airport, and independent power grid, was a typical old-style refuge, a tangible extraterritorial place. He did indeed turn himself and others into outlaws on this small island.

In the digital world, he has long begun a new layout. From funding Bitcoin developers, to investing in infrastructure, to lobbying regulatory policies, Epstein has reached into the cryptocurrency realm. Clearly, in his eyes, this virtual sanctuary is worthier of a bet than that physical island.

The 2015 Bitcoin crisis, the 2026 regulatory tightening. Everything that has happened in these 11 years is the latest round of this century-long cat-and-mouse game.

Dirty Money

In April 2015, the Bitcoin Foundation, once seen as the Federal Reserve of the Bitcoin ecosystem, admitted in an open letter that it had effectively become bankrupt.

Founded in 2012 by a group of early Bitcoin believers and evangelists, including Bitcoin's "heir," Chief Scientist Gavin Andresen, and later known as "Bitcoin Jesus" Roger Ver, its mission was to fund core developer salaries, organize conferences, promote the technology, and provide some form of official endorsement for this rapidly growing digital currency.

However, this centralized organization in a decentralized world disintegrated within just three years due to corruption, infighting, and mismanagement.

Its founding board member, the CEO of the then-largest Bitcoin exchange Mt. Gox, Mark Karpeles, was imprisoned due to the exchange's collapse and the disappearance of 850,000 bitcoins; Foundation Vice Chairman Charlie Shrem was sentenced to two years for involvement in money laundering.

With the Foundation's collapse, the livelihoods of five core developers became a major concern. Their maintained code supported hundreds of billions in market value, yet in reality, they were not receiving salaries.

In April 2015, just as the Bitcoin community was worried about this, the MIT Media Lab announced the launch of the "Digital Currency Initiative." They quickly took action, bringing in all three key figures, Gavin Andresen, Cory Fields, and Vladimir Van der Lan. The interdisciplinary laboratory, founded in 1985 and known for its visionary research and close collaboration with the business community and tycoons, became the "white knights" of Bitcoin developers.

But the money of this white knight was not clean.

The then-director of the MIT Media Lab was Joi Ito, a prominent Japanese-American investor who had been a major player in Silicon Valley, with early investments in Twitter and Flickr.

According to a 2019 investigation report by The New Yorker, it was Joi Ito who decided to use Epstein's money to fund this "Digital Currency Initiative."

Between 2013 and 2017, Epstein directly donated $525,000 to the MIT Media Lab. However, this was just the tip of the iceberg. According to Epstein himself, he assisted MIT in raising at least $7.5 million from other wealthy donors, including $2 million from Bill Gates. This funding was cleverly earmarked as anonymous, completely masking Epstein's influence.

This money was originally off-limits. Due to his 2008 sex offense case, Epstein was already on MIT's blacklist. However, Joi Ito created a backdoor using a "gift fund" to bypass the school's scrutiny layers and laundered the dirty money in. He even specifically emailed colleagues ordering that this money must remain anonymous.

Joi Ito truly understood the leverage of power. In another email written to Epstein, he pinpointed the Achilles' heel of Bitcoin's power: despite claiming to be decentralized, the life-and-death control of the code actually rested in the hands of 5 individuals. MIT not only got involved but managed to onboard 3 of them.

Epstein's response was short yet meaningful: "Gavin is a smart guy."

In other words, he had picked the right person. Through human control, they quietly took over control of the code.

This is the magic of top-tier institutions, capable of transforming the dirtiest money into the shiniest gold. A convicted sex offender underwent a transformation and became the hidden benefactor of the Bitcoin core circle. That "visiting scholar" guise enabled him to walk in freely, have unrestricted access in top laboratories, and engage in intellectual discussions with the world's brightest minds.

In 2014, Epstein also invested $500,000 in the Bitcoin infrastructure company Blockstream. This company was co-founded by several other Bitcoin core developers, including Adam Back, Gregory Maxwell, and Peter Wiulle.

Technology can be decentralized, but funding always has a source. To survive, the decentralized utopia had to accept centralized sustenance, albeit being at a disadvantage.

Epstein's logic was simple: first, keep Bitcoin alive, then steer its development in the desired direction.

By funding core developers' salaries, he not only saved a technology on the brink of collapse, but also acquired influence over its development direction. Joi Ito used his money to persuade 3 developers to join MIT, which means Epstein's funding effectively controlled the majority vote in Bitcoin's technical decisions.

With influence comes the power to define.

When Satoshi Nakamoto designed Bitcoin, the emphasis was on the technical decentralization — not relying on banks, not relying on central servers.

However, when people like Peter Thiel and Epstein got involved, it was imbued with a more radical ideological color, not just as a technological innovation, but as a challenge to national state power, a tool for "sovereign individuals" to escape constraints.

When you fund the people maintaining the code, you have the power to define what this technology "is." The technology itself is neutral, but whoever controls the narrative gets to decide whom it serves.

So, by backing cryptocurrency, what was Epstein really after?

The Secret Silicon Valley Dinner

Epstein was not just doing venture capital; he was more like looking for a similar vibe. He keenly sensed the much larger network beneath the surface, a small circle made up of top elites. In August 2015, at a private dinner in Palo Alto, California, the subtext of this small circle finally surfaced.

This dinner was arranged by LinkedIn co-founder Reid Hoffman, and the attendees were shining stars: Jeffrey Epstein, Joi Ito, Elon Musk, Mark Zuckerberg, and Peter Thiel.

At that moment, it had only been a few months since MIT had used Epstein's money to co-opt Bitcoin developers. Not a single person in this group would later fail to become a believer in cryptocurrency. Obviously, this was no ordinary social gathering.

In this circle, Peter Thiel was undoubtedly the spiritual leader. As a co-founder of PayPal, the first outside investor in Facebook, and the founder of the big data company Palantir, he was already a legend in Silicon Valley.

In 2017, when the price of Bitcoin was still hovering around $6,000, Peter Thiel's Founders Fund had quietly entered the scene, investing between $15 million and $20 million. By the time the crypto bear market arrived in 2022, this investment had brought the fund an astonishing return of about $1.8 billion. In 2023, he doubled down with another $200 million investment in Bitcoin and Ethereum. Every move he made was precisely timed on the eve of a bull market.

Making money was just a side effect; what Peter Thiel was truly obsessed with was the political metaphor behind Bitcoin. In his view, this was the true heir to PayPal, finally realizing that wild dream, creating a new world currency beyond government control.

The root of this idea can be traced back to a book published in 1997, later hailed as a bible by Silicon Valley elites, The Sovereign Individual.

Co-authored by James Dale Davidson and William Rees-Mogg, the core argument is: the Information Age will mark the twilight of the nation-state. True "cognitive elites" will completely break free from the confines of geographical borders, evolving into "sovereign individuals" above and beyond the nation-state. Not only did it accurately predict the emergence of "digital, encrypted currency," but it also directly sentenced the power of the state to death, asserting that this currency would completely erode the state's coinage rights.

For Peter Thiel, this was his intellectual lodestar. He once confessed to Forbes that no other book had reshaped his worldview like The Sovereign Individual. In 2009, he wrote in an article, "I no longer believe that freedom and democracy are compatible."

Since he no longer believes in the existing system, the only option is to leave entirely. This obsession explains why Thiel is so fascinated by any tool that can escape state power.

Prior to embracing Bitcoin, he heavily funded The Seasteading Institute. This project, spearheaded by the grandson of Nobel laureate Milton Friedman, aimed to establish floating cities in international waters, creating a utopia completely free from state jurisdiction, where individuals could choose laws and governments as freely as they do groceries. While sounding far-fetched, Thiel unhesitatingly invested $1.7 million. However, the project was eventually abandoned due to technical challenges, lack of funds, and local opposition.

Since a physical-world Noah's Ark couldn't be built, they had to seek a new continent in the digital world.

In 2014, through an introduction by Reid Hoffman, Epstein and Peter Thiel met. In 2016, Epstein invested $40 million in Thiel's another venture capital firm, Valar Ventures.

That same year, Peter Thiel took a risky step by openly endorsing Trump at the Republican National Convention. This gamble propelled him directly into the heart of power transition. Overnight, he transformed from a Silicon Valley investor into a key link connecting the tech world and the White House.

Behind these dinners and investments is a manipulator called the Edge Foundation.

This non-profit organization founded by John Brockman plays a typical circle game. In an email list exposed in 2011, Epstein's name appeared alongside Bezos, Musk, the Google duo (Brin, Page), and Zuckerberg.

Under the guise of science and intellectual exchange, it has roped in the world's top minds. But in reality, this is an exclusive elite club. Members communicate through private emails and offline gatherings, exchanging information out of the public eye, engaging in interest alignment and unified positioning.

If Davos is a stage show for the world to see, then the Edge Foundation is the backstage. All technological bets and political stances were long ago coordinated behind closed doors. In their view, Bitcoin is not just an asset but also a weapon.

Sovereignty Fantasy

Whether a private island or Bitcoin, fundamentally they represent the same ideology in different dimensions: escaping the constraints of nation-states. The former creates a lawless place in physical space, while the latter builds a sovereign domain in digital space.

From Swiss bank accounts to Bitcoin public key addresses, the wealthy have always sought new digital codes to conceal their wealth. The privacy of Swiss bank accounts is protected by bank secrecy laws and professional ethics, while the anonymity of public key addresses is safeguarded by cryptography and decentralized networks. Both promise to protect privacy, yet both are eventually caught up by regulation.

What Peter Thiel calls "freedom" has nothing to do with you and me.

According to the "World Inequality Report" released by the end of 2025, the wealthiest 0.001% globally (less than 60,000 people) control wealth that is three times the total wealth of the poorest half of the global population (about 4 billion people). In 2025, global billionaire wealth grew by 16%, triple the average of the past five years, reaching a record $18.3 trillion.

This is the truth of their pursuit of "freedom" — a world where wealth and power are concentrated infinitely in a few "sovereign individuals," leaving billions of people behind. They advocate for Bitcoin not to improve the lives of ordinary people, but to completely free themselves from any form of social responsibility and wealth redistribution.

The narrative that frames the technological framework as an "anti-government tool" rather than a "public interest tool" is widely circulated in Silicon Valley's libertarian circles.

In fact, blockchain technology should have had a different way of life. It could have been a demon-revealing mirror, used to scrutinize how government budgets are spent, how votes are cast. But when these elites treat it as their private backyard, this technology, which should have benefited the public, is forcibly hijacked into a privileged channel for a few.

Reality soon dealt them a heavy blow — total escape is impossible. Whether hiding in international waters or concealed in code, the gravity of the real world always exists. These clever individuals soon realized that since they couldn't run away, they changed their approach. Instead of evading the rules, they decided to simply buy the people who make the rules.

In February 2018, an email sent to Steve Bannon sounded the alarm.

Steve Bannon, the former "White House Chief Strategist," had just recently left Trump's inner circle, but his influence still lingered in Washington.

Epstein reached out to him with no pleasantries, directly pressuring him in the email: "Will the Treasury Department respond at all? Or do we need to take a different path?"

Epstein's urgency stemmed from his proposal of what seemed like a cooperation with regulation but was actually a Trojan horse: the Voluntary Disclosure Form.

On the surface, he claimed this was to help the government "catch the bad guys" and ensure that criminals had nowhere to hide; however, in reality, this was a get-out-of-jail-free card tailored for the elite. He hoped that by voluntarily disclosing income and paying back taxes, those massive sums of illicit funds hidden in cryptocurrency could be granted amnesty through legitimate means.

In another email, Epstein wrote in a panic: "Some bad stuff. Really bad."

He, more than anyone, was aware of how many shady deals lay beneath his and this circle's wealth. He desperately needed a ticket for "voluntary disclosure" to whitewash himself and his associates before the regulatory guillotine fell, achieving the final cleansing.

This move was not new in Washington. After the UBS case in 2009, the IRS introduced the Offshore Voluntary Disclosure Program. This program allowed taxpayers with undisclosed offshore accounts to avoid criminal prosecution by voluntarily disclosing, paying back taxes, and a fine. Between 2009 and 2018, around 56,000 taxpayers participated in the program, helping the IRS recover approximately $11.6 billion in taxes.

Epstein's plan was to transplant this spend-money-to-whitewash logic as it was directly into the cryptosphere. His voluntary disclosure scheme aimed to leverage tax payments to legalize illicit funds. This was precisely the game the elite excelled at; as long as they could manipulate the rule-makers, any dark past could be laundered into a clean whitelist.

Peter Thiel's level, evidently, was higher; he saw Washington as a Silicon Valley company to invest in.

In 2016, he wagered $1.25 million in donations on Trump, successfully getting his disciple Michael Kratsios into the White House as Deputy Chief Technology Officer.

In 2022, he upped the ante to $15 million, sending Watts to the Senate. And this new senator, not only an ally of Thiel, also held millions worth of Bitcoin.

Have you figured it out? This had long surpassed ordinary political donations. These tech elites, who championed "sovereign individuals," were systematically placing their own kind in key positions, step by step, completing the takeover of the state machinery.

However, the regulatory hammer eventually came down.

On New Year's Day 2026, a "global manhunt" for the crypto industry, the "Cryptographic Asset Report Framework," was officially launched. Over 50 countries simultaneously initiated it, with another 20 countries following shortly after. It directly turned exchanges and wallets into informants for the tax authorities. They will collect detailed customer information and then report this information to the tax authorities of the customers' respective countries. Between tax authorities worldwide, the information will be transmitted to the customers' tax residence country through an automatic exchange system.

A global dragnet covering crypto asset tax issues was thus cast.

Epilogue

From Swiss banks to Bitcoin, this cat-and-mouse game that has lasted for nearly a century has finally hit a wall under the regulatory globalization curtain.

After the escape route in the digital space was blocked, where will the new sovereign fantasy take root?

This time, their ambitions are greater. Peter Thiel is funding anti-aging and life extension technologies, attempting to break free from the ultimate constraint of death. Elon Musk dreams of colonizing Mars, betting the future of humanity on a brand-new planet.

These seemingly far-fetched dreams share the same core as the prophecy of the "Sovereign Individual." They want to use technology to create a new world that transcends nation-states and democratic systems. Whether it's immortality or interstellar colonization, they are the latest versions of the "escape plan."

Epstein's story is just a footnote in this grand narrative, a dirty yet incredibly real footnote. It reveals how when technology is detached from the track of the public interest and becomes a tool for a few to pursue absolute freedom, it bears such evil fruit.

Now, we must confront this harsh reality: when the blueprint for the future is drawn at a private banquet where we are not even qualified to dine, all the rules will have nothing to do with us.

When a handful of elites who are not accountable to anyone can whimsically define our money, our society, and even our lives based solely on their capital, what are we then?

This is the question that this story truly leaves us. A question without an answer but one that each of us must consider.

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