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The space dream of the crypto plutocrats: $1 billion to build a commercial space station
Written by: Kiel Porter, Loren Grush, Bloomberg Businessweek
Compiled by: Luffy, Foresight News
Jed McCaleb has made a fortune in the cryptocurrency field, and now he is ready to invest a large portion of it into his dream of space.
This billionaire, who once founded the notorious Bitcoin exchange Mt. Gox and the cryptocurrency XRP, is independently funding an ambitious project: to build the world’s first commercial space station and send it into space.
If successful, his startup Vast Space LLC is expected to win a contract from NASA worth potentially billions of dollars next year to replace the International Space Station. McCaleb stated that if he fails, he is prepared to lose $1 billion. As of the end of 2023, McCaleb controls billions of dollars in assets through two foundations, with the $3.3 billion in assets coming entirely from his personal donations.
"It is crucial for humanity's future to live beyond Earth." McCaleb, 50, stated at the company's headquarters in Long Beach, California, "Not many people are willing to invest as much resources, time, and endure risks as I do."
Since then, he has hired an industry veteran as CEO, and SpaceX has also provided some technical support to Vast. At the same time, Elon Musk has urged the U.S. to accelerate the decommissioning timeline for the International Space Station (currently planned for the end of 2030). Vast was founded in 2021, and some components of its spacecraft utilize technology developed by SpaceX, particularly the docking adapter used to connect the SpaceX Dragon spacecraft to the Vast space station, as well as the space internet system that provides Wi-Fi to the space station through Starlink. Vast has already booked SpaceX's launch services to send its hardware into orbit and transport astronauts to the space station, and SpaceX has also agreed to carry astronauts for Vast, pending NASA's approval.
However, this task remains daunting, and from McCaleb's experience, it is hard to see that he is the person capable of handling it. This boy from an Arkansas farm, a dropout from the University of California, Berkeley, has no background in the aerospace industry. His career is characterized by seizing opportunities in emerging technologies and then timely transforming before government regulation and other adverse factors disrupt the industry. This short-term thinking seems to be at odds with the long-term focus needed to win a high-risk competition that creates technological miracles.
Sam Yagan is a friend of McCaleb, who co-founded an online file-sharing company with him over twenty years ago. Yagan is now a co-founder and managing director of Corazon Capital, and he stated that this entrepreneur is a thoughtful risk-taker. "He is very rational about these things," Yagan said, "but he is willing to take the huge risks that you and I see as a bit unconventional."
Many employees at Vast have previously worked at SpaceX. The parking lot at the company headquarters is filled with cars produced by Tesla, which is owned by Musk. One of the Cybertrucks belongs to Max Haot, who joined Vast in 2023 after McCaleb acquired his company. Since then, Haot has become the CEO of Vast, having McCaleb (who drives a more ordinary Model 3) fly in from his home in San Francisco once a week to oversee project progress.
Before being acquired, Haot did not focus on the space station field. Instead, he tried to emulate Musk by founding another rocket launch startup, Launcher. The company secured $30 million in investment and made progress in developing rocket engines and launch vehicles, but the two satellites built by Launcher encountered failures after entering space. In 2022, Haot met McCaleb while looking for investors.
McCaleb proposed an acquisition and agreed that Haot would serve as the president of Vast, ultimately becoming the CEO. Initially, Haot was reluctant to accept the deal, but when he realized that Launcher was struggling to secure the necessary funding, he changed his mind.
Vast's grand vision is not just to build the first private space station. The company also aims to develop an artificial gravity system to simulate the Earth's environment for future astronauts. This project is highly complex and requires the use of centrifugal force to set up large rotating modules in space. This proposal is quite appealing, as human experience living and working on the International Space Station has shown that prolonged exposure to microgravity can harm various biological systems.
However, all of this is still a long way off. Currently, Vast needs to launch its first space station into orbit. The number of employees at the company has rapidly increased from less than 200 a year ago to 740, covering a range of talents from technical engineers to spacesuit manufacturers. Vast's headquarters operates 24 hours a day, with engineers and construction workers working in shifts, either expanding the Long Beach facility or building Vast's first prototype space station "Haven-1."
Space stations are common elements in popular culture, such as the Death Star in "Star Wars" and the namesake space station in "Star Trek: Deep Space Nine." Since astronauts first boarded the experimental Skylab in 1973, space stations have also been an important part of U.S. space exploration. Decades later, with the end of the Cold War, NASA collaborated with countries like Russia to build a larger International Space Station. Since November 2000, there has always been at least one astronaut on the International Space Station, who frequently studies the behavior of materials and the human body in microgravity environments.
Haven-1 is approximately 33 feet (about 10 meters) high, 14.5 feet (about 4.4 meters) wide, and designed to fit snugly inside the nose cone of a SpaceX Falcon 9 rocket. The habitable space of the station is about 1,600 cubic feet (45 cubic meters), which is roughly twice that of a typical RV. It will be equipped with private sleeping pods, a large window, wooden paneling, and a table for four.
At least that is its goal. In January of this year, the company began constructing Haven-1, which is scheduled to launch in May 2026, delayed from the initially planned August of this year. The company recently tested a prototype to confirm its structure can withstand internal air pressure, and is developing critical components for the power system, propulsion system, and other manned mission tasks. Its shell must be able to withstand the harsh environment and temperatures of space while maintaining the air pressure and gases that humans are accustomed to on Earth.
"We are not yet a real space station company," Haot said, "We are an aspiring space station company."
Assuming everything goes smoothly, after the launch of Haven-1, Vast will send four astronauts into space with the Falcon 9 rocket to dock with the space station. If the first launch is successful, Vast plans to launch the first module of the next space station, Haven-2, before 2028. It will serve as the starting point for a larger base, intended to replace NASA's International Space Station.
One of the biggest challenges will be to create an effective life support system. The International Space Station uses a regenerative system that recycles all wastewater into drinking water and converts carbon dioxide into breathable oxygen. Such a system is necessary if passengers are to stay on the space station for a long time, but Haven-1 will not be equipped with one as astronauts are expected to stay only for a short period. Vast plans to eventually equip Haven-2 with such a system, but it is expected that the space station will not have long-term occupancy in the initial years.
Competitors including Axiom Space, Blue Origin, and Voyager Space Holdings are also vying to build their own space stations, but one advantage for Vast is that McCaleb is willing to invest heavily in the project. "Vast is the only company that primarily relies on its own funds and is ready to go," said Chad Anderson, founder and managing partner of Space Capital, an investment firm focused on the aerospace industry. "In that regard, they are an interesting choice." (Anderson has no financial ties to Vast but has invested in SpaceX.)
Although these competitors have aerospace backgrounds and some launch contracts, they do not have such close collaborations with SpaceX.
McCaleb is eager to downplay any personal relationship, stating that he has seen Musk "a few times, he probably doesn't remember me," despite both having invested in OpenAI. Although they differ in methods and demeanor, there are many similarities in their respective interests and unconventional paths to wealth: both dropped out of school (Musk dropped out later), founded software companies in emerging fields, and turned their love for fantasy and gaming into financial success.
McCaleb's first project eDonkey was one of the earliest file-sharing services on the internet and an early competitor to Napster. The company was founded in 2000 and allowed users to share music and movies for free, generating millions of dollars in revenue each year through advertising. In 2006, to avoid copyright infringement lawsuits, the company agreed to pay $30 million to the Recording Industry Association of America and subsequently shut down.
McCaleb's next success was Mt. Gox, one of the world's earliest Bitcoin exchanges. The website was founded by McCaleb in 2010, and a year later, he sold most of his stake at an undisclosed price. In February 2014, the exchange went bankrupt, and users lost Bitcoins worth over $400 million at the time, marking the largest cryptocurrency disaster in history before the FTX collapse in 2023. Although McCaleb remained a minority shareholder, he faced no penalties and claimed to have incurred losses in the disaster.
At that time, McCaleb had already started his next project: XRP, the cryptocurrency on the Ripple protocol, of which he is also a co-founder. McCaleb initially owns 9% of XRP. He left the company in 2013 after a disagreement with the co-founder, but kept his XRP and gradually sold it in the following years. According to XRPScan's analysis, during the cryptocurrency boom in late 2017, XRP's value soared, eventually swelling its market capitalization to $130 billion in January 2018. McCaleb netted about $3.2 billion between 2014 and 2022 by selling stakes in XRP and Ripple.
"He is one of the ten most important founders in the cryptocurrency space, even though very few people really understand him," said Nic Carter, founding partner of the public blockchain-focused investment firm Castle Island Ventures. "Interestingly, most of the other important figures are those flamboyant, high-profile, and extravagant individuals."
Despite achieving great success, McCaleb's social circle is quite small, primarily collaborating with Yagan and other long-term partners. He has a house in the surfing paradise of Costa Rica, a residence in Berkeley, and owns his own private jet.
McCaleb provides a stable source of investment for the often volatile aerospace industry. In this field, once-promising startups frequently collapse due to lack of funding. Although a former employee has filed a lawsuit accusing Vast of trying to cut corners, the company does not seem to have negative news like SpaceX. Its billionaire CEO spends most of his time at home with his wife and three children, rather than trying to fight the federal government.
If McCaleb's plan succeeds, Vast has already booked multiple crewed missions with SpaceX to send astronauts into orbit, and both McCaleb and Haot have expressed their willingness to take these flights. "As a child, I spent a lot of time exploring outdoors, gazing at the sky and marveling at its wonders," McCaleb said. But all of this depends first on whether the company can win the final contract for the NASA program, which aims to initiate a commercial space station project that could replace the International Space Station. The program has a soft guarantee that NASA will purchase time and space on any space station that reaches orbit. This contract is expected to be signed by mid-2026.
Haot said that without a contract from NASA, the commercial viability of any space station is questionable. "Winning this competition is a matter of our survival."