A Crypto Alchemist Made Me an Accidental Billionaire

FEW THINGS CAN turn around a boring winter afternoon like receiving a billion dollars. The amount is there, in its 10-figure glory, glaring from my phone screen in white characters against a charcoal background: $1,112,172,834.

Valentin Broeksmit in Los Angeles in 2018.PHOTOGRAPH: ORIANA KOREN/THE NEW YORK TIMES/REDUX

FEW THINGS CAN turn around a boring winter afternoon like receiving a billion dollars. The amount is there, in its 10-figure glory, glaring from my phone screen in white characters against a charcoal background: $1,112,172,834.

Visions of WIRED’s gift and hospitality policy float before my eyes: Staff may not accept “gifts, meals, discounts, travel expenses” over $30. I’d had no plans to become a billionaire. And yet the man messaging me on Signal has decided that sending me a billion dollars in cryptocurrency is the best way of proving his point about the legitimacy of a crypto app. His plan is to exploit a possible vulnerability in a cryptocurrency wallet app to squeeze money out of thin air, and in the process, expose the app as either shoddy or fraudulent. A few minutes earlier, he had written that he wanted to become an “alchemist.”

His name is Valentin Broeksmit. His own balance exceeds five trillion dollars.

I’ve heard of Broeksmit before: A musician and founder of a band called Bikini Robot Army, in press shots he affected the indie-singer look as a lanky man in his forties wearing shades and a fedora. His real claim to fame, however, was as a financial whistleblower. In 2014, after the death of his father, Deutsche Bank executive William Broeksmit, Broeksmit Jr. began to leak a trove of documents on the bank’s inner workings to journalists and FBI agents. While the value of his material has rarely been questioned, his sometimes erratic behavior is notorious. He’s tweeted documents (which he retrieved on Reddit) that had been stolen in North Korea’s 2014 Sony Pictures hack, eliciting the company’s ireThe New York Times reported that he met with US congressmember Adam Schiff to help him investigate Donald Trump’s finances in 2019; he was reported missing by his girlfriend in 2021, and was technically still a missing person when we spoke.

Early in the day after he makes me a theoretical billionaire, Broeksmit calls me from his loft in downtown Los Angeles. The three-hour conversation is one of the oddest in my life: Broeksmit spins a story of financial derring-do, spiced with fast-paced tangents about his favorite pub in London and the org chart of the KGB. His live-in partner, visual artist Marie Peter-Toltz, occasionally chimes in—sometimes in Spanish—to dispute the sequence of events. The call ends and restarts several times, once because Broeksmit’s cigarette has burned a hole in his pillow, filling his loft with down feathers. Broeksmit comes across as a skilled raconteur, but also erratic and impulsive. The pooled balance of several different crypto coins, amounting to a billion dollars, is still in my wallet. How did he do it?

Broeksmit tells me he and Peter-Toltz had started looking into crypto in the winter of 2021 because they were “broke as shit.” During his research, Broeksmit chanced upon Incognito Wallet, which developed a blockchain where people can exchange and trade cryptocurrencies via peer-to-peer payments or through a decentralized exchange (DEX), which allows cryptocurrencies to be swapped directly without going through intermediaries. Run by an anonymous team mostly based in Vietnam, Incognito styles itself as privacy-conscious, open source, and decentralized.

Incognito also lets users mint their own cryptocurrencies, Broeksmit says. One just has to pick a name and ticker symbol and provide information about the purpose of the coin in order to launch it as an asset tradable within Incognito’s ecosystem. Incognito suggests that businesses can create these coins to drum up publicity or dole out promotional rewards to customers. Normally, these coins appear to have a value of zero dollars, as no one is seeking to trade them for pricey mainstream cryptocurrency on Incognito’s exchange.

But Broeksmit says he thought he could create new coins and then manipulate the market to make them valuable—in his view, a version of the true ethos of cryptocurrency. “Every time you read someone with a philosophy about a coin, it’s bullshit,” he says. “It’s like you’re saving the world or your token means something, but it’s just to make money.” So he set out to follow, wide-eyed, in the footsteps of many in crypto before him who had bragged that their wit had made them a fortune.

So Broeksmit minted a series of coins inside Incognito. One is called parsec—a unit of astronomical distance infamously misused in Star Wars—and another BRA, after his band. A third is called “drone algo red 41 coin.” Then, he says, he set out to increase the value of his coins by trading them back and forth, creating “liquidity pools” so that Incognito’s algorithms adjusted the custom coins’ prices accordingly. Finally, he linked his tokens into “daisy chains” connecting to Incognito’s native token PRV, and then to mainstream cryptocurrencies. The tangled result, he claims, was similar to structures seen in conventional financial markets. “Basically what we had here was a derivative. That was my father’s thing—derivatives,” he says.

Broeksmit spent four days building his financial matryoshka, locked in the only room with a door in his open-space loft: the bathroom. He claims to have invested a sizable amount in mainstream cryptocurrency—including bitcoin, ether, monero, doge, tether, and BNB—to prop up the prices of his own coins, but refuses to say how much.

Despite all his pumping, by December none of Broeksmit’s tokens had taken off, and their prices remained low. He wrote off the project as a waste of time. But on the morning of January 9, 2022, Broeksmit opened his Incognito wallet, and everything changed. “I was a trillionaire,” he says. He thought his magic had finally worked: All the tokens he had traded boasted multibillion valuations. He says he leaped off the bed and started banging on the bathroom door, shrieking “Emergency!” to alert Peter-Toltz, who was inside, that a portentous event had happened.

“I was very scared, because I thought that would obviously draw a lot of attention,” Broeksmit says. Then reality set in: This number could not be right. “I know I didn’t put in a trillion. I don’t have anything close to that in my liquidity pools.” Yet, the app kept showing an astronomical valuation for his coins, which he thought proved that he could game the app, or that it was a scam. But when Broeksmit tried to trade his parsecs and drone algos for bitcoin, ether, or BNB, and then presumably cash them out, Incognito returned an error message: “No trade route found.” He says the same message appeared when he tried to exchange one of his custom coins for another. (The same error appeared when I attempted to trade my billion, which was mainly in parsecs.)

The right thing to do, given the fact that the value attributed to his coins was not correct, he says, would have been to alert his FBI contacts, as he thought these loopholes could be abused by money launderers. Or, more simply, to shame Incognito for its shoddy design, and for its blocking of trades in contravention of its professed creed of decentralization and free trade.

Still, the trillions beckon to him. It is an amount so ludicrously eye-popping that even cashing out a fraction of it would be life-changing. While he says a part of him—the rational part—knew that the value was likely illusory, the mirage of suddenly becoming rich was irresistible. “I thought I could—I can—figure out a way to keep it somehow. That was when I became just like everybody else. That was my tragic, stupid error,” Broeksmit says. “I got greedy.”

The Scramble to Empty the Wallet

In a way, what Broeksmit is doing is part of an honored crypto tradition, the industry’s unwritten principle that if your coding skills leave you vulnerable to hacks and thefts, you have only yourself to blame. On the blockchain—the decentralized, leaderless ledger where cryptocurrencies trade—there are no such things as thieves, just smart people finding novel ways of using a certain product.

In June 2016, that attitude was tested when a decentralized venture capital fund called The DAO launched on the Ethereum blockchain, and users exploiting a loophole in its code spirited away some $50 million in crypto. In response, some members of the Ethereum community shrugged, implying that the attackers had done something allowed by the code, hence legit; others advocated for a rewriting of blockchain history that would return the missing funds. The latter faction won the day, but the “code is law” ethos survived in other parts of the ecosystem, such as decentralized finance, or DeFI.

During our first three-hour phone call, as Broeksmit explains how he had sent me the billion, I am unsure whether he’s taking the whole affair as an intellectual exercise. His motives seem fluid: He wants to take Incognito down; he implies that a Russian spy ring might be running the app; he thinks “it’d be great to be a trillionaire.” He swears he would be content with a million dollars, $100,000, $50,000, $10,000, or even $500. “Anything I can get out would be great,” he says. He clearly needs the money.

Crypto alchemy is a last-ditch attempt to fund a custody battle Peter-Toltz is fighting over her son, who until recently had lived with her and Broeksmit. “We needed to make money to pay the fucking lawyers,” he says. He says that Peter-Toltz and her ex-husband had clashed over Broeksmit, who has a history of substance abuse, being in the son’s life. (Peter-Toltz’s ex-husband did not reply to requests for comment via email and on social media.)

Broeksmit appears to believe that I can help by drawing attention to his campaign to prove that something is rotten in the fair kingdom of cryptoland. He and Peter-Toltz had already started a full-on PR offensive, creating multiple discussion threads on Incognito’s forum demanding that the Incognito developers make it possible to trade his custom coins to allow them to cash out; Peter-Toltz had left comments laced with French curse words. Incognito’s baby-faced, spiky-haired community manager Jared Maxwell assured them that action to look into the matter would be taken—but it never was. Broeksmit then took to Twitter, broadcasting his newfound riches to the world and giving away millions to whoever asked in a bid to create a critical mass of theoretical crypto-moguls eager to join his fight. “We can get everyone to complain until they do something about it,” he says. “Then everyone’s gonna be happy and everybody wins.”

Between January and February, Broeksmit’s messages become a fixture of my life. Some are just screenshots of his trillion-dollar balance, or of a particular post on Incognito’s website. Sometimes, he calls me at odd hours, adding pieces to the puzzle of his tale of attempted crypto-alchemy.

On one of those calls, Broeksmit tells me that when he realized his predicament, he decided to ask his FBI “handlers” for help—though how they could’ve aided him was unclear. He says he shared a four-hour tape, surreptitiously recorded, in which he spoke at length about the case to three people, presumably FBI agents, who sounded sympathetic but noncommittal about getting involved. An FBI spokesperson says she has “no information to share” when reached for comment about the circumstances of the meeting. Eventually, in April 2021, Broeksmit resolved to “go missing” in an attempt to help Marie’s custody claim.

“I formulated a plan,” he says. “If I am gone, they won’t be able to mention me in court.” In fact, Broeksmit just spent around three months in his bedroom, staying out of sight.

A Fistful of Worthless Coins

By February, Incognito appears to crack down on Broeksmit’s coins. I can see that play out in my own wallet too: Over the course of just five days I’ve gone from billionaire to the owner of a mere $200 million worth of coins. Broeksmit starts to complain that the pots of crypto underpinning the exchange of token pairs are also being “drained.” On the forum, Incognito’s Maxwell announces a new criteria for verifying custom tokens and the creation of a five-person verification committee, in order to avoid scams. The move seems to be directly targeting actors such as Broeksmit.

Broeksmit sounds incensed. He says he is convinced that Incognito is run by Russian operators and starts to bombard Maxwell with messages in broken Russian, hoping to smoke him out. (I find no evidence of any ties between Incognito and Russia.)

But Broeksmit is not the only one to be affected by the foundering of his scheme. A startup founder going by Deivisson, whose crypto token had also skyrocketed to a multibillion-dollar valuation before being frozen and falling down vertiginously, says that Incognito “tarnished” his company’s image. “What am I going to tell my private token investors?” Deivisson says. In fact, his token’s value had single-handedly been inflated by Broeksmit. “I don’t have the heart to tell him that it was just Marie and I trading his coin,” Broeksmit says.

It is undeniable that in Incognito, Broeksmit has found a worthy match. Getting a straight answer from team members—nearly all anonymous, as it often happens with crypto developers—is borderline impossible; getting a polite one is harder (when I reach out to Grant Hawkins, formerly the company’s public face on YouTube, he entreats me to “do something constructive” rather than write my “dumb fucking article.”)

But after nearly a month of chasing, in mid-February Maxwell answers my questions in writing. His answers shed some light on the saga of Broeksmit’s trillions. In short: The app calculates custom tokens’ prices by taking wild guesses based on the number of tokens and how they have been traded. “Without organic realistic trades on the app there can be no accurate display of value,” Maxwell says, adding that Incognito plans to remove that algorithmic price guess “in the future.” In other words: Broeksmit’s manipulation had likely fooled the app’s algorithms to display a preposterous value. But the app is just a flawed interface grafted over a small blockchain: There are no trillions to harvest. And even if there are, Incognito is not really a decentralized finance product. It is an app on which its developers exert centralized control—they prevent the coins from being traded and then introduce new verification rules to stave off further unrest. Incognito was never a realistic target for crypto-heists like Broeksmit’s.

When I present this very mundane answer to him, Broeksmit is unconvinced.

He keeps creating new tokens, watching their value skyrocket, then deflate a few days later. But the reality of what is going on eventually catches up with him. As of February 19, the balance of his wallet is zero. (So is mine.) His rage toward Incognito is monumental. He says he has paid some of his friends and acquaintances with custom coins, and that now those people are angry at him. “It’s a nightmare,” he says.

Alongside his custom tokens, he says he’s lost all the money—in mainstream cryptocurrencies—that he had invested in the first place to pump up his custom currencies. In one of our calls, I again try to get an exact figure for his losses, but he won’t say. ​​“I can’t tell you right now, Marie will get pissed off,” he says. Peter-Toltz, in the background, proposes leaving the room, but Broeksmit stops her. “Just everything we had,” he adds.

Then, things go quiet for a few weeks, barring the occasional text.

On April 5, I receive a call at 6 pm London time. It is Broeksmit. He sounds upset. Everything is lost, he says. They’ve lost the court case, they’ve been evicted from their loft. Most importantly, Peter-Toltz is missing. “We were parking to go sneak into our house—and now I just can’t find Marie,” Broeksmit tells me. “She’s gone.” I suggest Peter-Toltz might have gone to stay with some friends. “Friends? We don’t have friends now,” he says.

It is now clear that Broeksmit had fallen in love with a mirage. Buffeted by personal adversities and financial difficulties, he had grasped for a miraculous fix and found the get-rich-quick delusion that permeates the worst corners of the cryptocurrency world.

Court records later uncovered by Motherboard show that a day after our last interaction, on April 9, Broeksmit is arrested and placed under a restraining order, forbidding him from getting close to the loft again. A “ghost gun” with no serial number is found in his car. He is released shortly afterward. He again enters the property four days later, on April 13. Then, a long period of silence—until April 23, when someone texts me from Broeksmit’s Signal account. It isn’t him. The text reads: “Marie has been found and now we need to find Val who is missing.” I ask who is writing. No one answers.

On April 25, Broeksmit’s lifeless body is found on the grounds of a high school, not far from where he had previously lived. An investigation on the cause of his death is pending, but initial police reports rule out foul play. The LAPD officer in charge of the inquiry does not reply to a request for comment via email. Marie Peter-Toltz, despite what the anonymous texter told me, is currently a missing person according to the California Department of Justice, and she hasn’t replied to my texts, emails, and Twitter direct messages. Inevitably, Broeksmit’s death has become fodder for a cottage industry of conspiracists, striving to see in the death of a one-time whistleblower the work of some evil cabal.

But I feel I knew the man behind the whistleblowing persona, who would often delight in asking about mundane things like my dating life between sharing wild claims and tall tales. The news of his death shocks me. Broeksmit’s plan for crypto alchemy had backfired, and sent him down a spiral that ended with his life being cut short. I’m left with a story I had promised to write, piecing it together by going through reams of texts and emails and hours of conversations with a man who desperately wanted to be taken seriously.

“Be kind to us when you write about this,” one of Broeksmit’s final texts reads. “Please, write me fair.”