Working at the Auschwitz Concentration Camp, Sebastian Shaw took the alias of Klaus Schmidt. There he performed several sadistic experiments on patients. By the end of the war, in 1944, he noticed a young Jewish boy, Erik Lehnsherr, bend a metal gate. When the boy was unable to do so to a coin, Shaw killed Erik's mother. Realizing that Erik could harness his powers with rage, for the duration of the war, he studied and tortured the boy, learning more about his mutant powers as well as his own. When the war ended and the Allied forces stormed the camp gates, Shaw fled.
For sixteen years Shaw began to harness his own mutant abilities, planning out destroying humanity. To do this, he recruited several other mutants into his Hellfire Club. However, he was opposed by CIA and in 1962, he began to manipulate the United States of America through Colonel Hendry and the Soviet Union through General Armivolkoff. The two countries began to place each others nuclear missiles in their respective satellite nations that were near the two superpowers. However, Shaw was not counting on the formation of Division X. Due to this, he attacked the CIA once and killed the mutant Darwin.
At the Cuban Missile Crisis, Shaw absorbed nuclear energy, making him as powerful as a sub-atomic bomb. He was then confronted by Erik and began to try and convince his former subject to join him. However, as Shaw was not wearing his helmet, he was unable to withstand being telepathically paralyzed by Charles Xavier. Shaw was then ironically killed by Erik using a coin.
Shaw was able to absorb and metabolize kinetic energy, using it to make himself stronger and keep himself young. This made him a very tough combatant as he would only always get stronger. However, in order to use energy, Shaw would need to absorb it first.