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GSB professor pushes back against claims of ‘anti-Bitcoin rhetoric’ in guest lecture

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Graduate School of Business (GSB) economics professor Susan Athey Ph.D. ’95, has pushed back against second-year Stanford Law School (SLS) student Conner Brown’s claims that she made false statements disparaging Bitcoin in a January guest lecture. Athey sits on the Board of Directors of the company, Ripple Labs Inc., that created the cryptocurrency XRP, and called Brown’s allegations — which have since been picked up by several news sources — a mischaracterization of her lecture.

“I would also like to raise concerns about potential conflicts of interest in a professor making false statements while simultaneously promoting a product that claims to solve these problems and being paid by that company,” Brown wrote in an email to economics professor Jeremy Bulow and professor emeritus Myron Scholes, who organized the course in which the guest lecture was given.

Athey, who in 2007 became the first woman to win the prestigious John Bates Clark Medal for economics research, contested the allegations of bias. In an email to The Daily, Athey wrote that Brown “mischaracterized the context of the class as well as the specific content, and had numerous other problems.” Athey also wrote in a Tweet that Brown had never contacted her.

Claiming that his professors refused to address his concerns, Brown posted the email onto Twitter in late February, at which point several news outlets described the lecture as “skewed,” motivated by a conflict of interest and largely ignored by the University. A Bitcoin News article alleged a “litany of errors” and wrote that “Athey has brought not only her own but also Stanford’s academic integrity into question.”

A Yahoo! Finance article noted that “While an overwhelming majority are in Brown’s corner, some were quick to pick up that his own responses might not necessarily be correct.”

The five false claims Brown alleges Athey made are that Bitcoin is “controlled by a small group of miners in China,” Bitcoin accounts are “secured economically and not cryptographically,” Bitcoin “wastes electricity by stealing from rivers,” Mexican financial institution Cuallix uses Ripple and Ripple does not sell but “routinely disperse[s]” XRP.

The first two statements are subject to interpretation. Most “mining nodes” — organizations miners can join for more consistent payoffs — are in China, but individual miners are free to join and leave such nodes, so who has how much power and the odds of a 51% attack.

Bitcoin’s electricity usage is also contested, but estimates put it around the amount that would be used by a medium-sized country. In an interview with The Daily, Brown did walk back on the fourth point, stating “I agree that Cuallix does seem to be a real company to some extent, at the time of my email I was unsure if that was true.”

Finally, Ripple does sell XRP based on their financial reports.

However, Brown acknowledged the ambiguity and complexity of these topics in a follow-up email to Scholes and Bulow.

“These are brand new areas of study and it takes time for these ideas to really get tested and come into focus,” Brown wrote.

“I didn’t get into the level of technical detail or precision described in Conner’s post — was heuristic and intuitive,” Athey wrote in a Tweet, writing that the lecture was prepared for a “non-technical MBA class with [students who had] no background in blockchain or Bitcoin.” She also posted a link to her slides.

Responding to a question about the disclosure of her conflict of interest, Athey wrote in another Tweet that she had provided a five-minute verbal discussion of her “background in the space.”

Brown told The Daily that his goal had been to highlight incorrect statements he believed were spurred by a conflict of interest.

“My concerns are more with Professor Athey saying things like this in an academic environment,” he explained.

Josh Hedtke, a third-year SLS student, said that he “vaguely” recalled Athey’s lecture being “fairly one-sided.” He recalled repeated acknowledgment of her ties to Ripple, however.

“Once or twice throughout the presentation, she would talk about why Ripple solved problems Bitcoin had,” he said. “But then she would say something like, ‘But then again I’m on the board, so I can’t tell you to buy Ripple.’”

Brown’s letter was posted on Twitter on Feb. 23, more than a month after Athey’s Jan. 23 lecture.

“My professors refused to talk in person after bringing this to their attention,” he wrote in his Tweet. “Over a month later I still have heard no response, other than ‘we will get back to you on this.’”

However, email correspondence between the involved parties appears to contradict this, showing professors’ willingness to discuss the issue.

In a Jan. 27 email to Brown, Scholes wrote that “If [Brown] wish[ed] to set up a time for a discussion, [he] would be happy to do so,” and that he was “more than willing to discuss.” In his reply, Brown said that he would “love to discuss this at a later point.”

In a separate email to The Daily, Brown wrote that he tried to approach Bulow after class, “but was told by [Bulow] he did not have the time to speak about these things in person.”

In emails, Bulow and Scholes also pushed back against Brown’s allegations.

In a Jan. 26 email to Brown, Bulow linked several articles that he described as “broadly consistent” with some of Athey’s claims, though he noted that the articles could be incorrect and that he had not fully examined Brown’s claims. In his Jan. 27 email to Brown, Scholes wrote that Athey “made it clear” that she was affiliated with Ripple.

When reached for comment on allegations of biased content, Athey said she was invited to speak “based on my experience and industry knowledge relating cryptocurrency and blockchain.” She emphasized she spoke about her personal experience in the industry and described the lecture as “intended to help MBA students interested in finance understand some of the early developments in cryptocurrency.”


Contact Mihir Patel at mihirp ‘at’ stanford.edu.

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