How I lost a fortune in Bitcoin - My Story
I thought I would share how I first got involved with Bitcoin back in 2014. By taking part back in the relatively 'early days', one could probably safely assume that 3 years later I would have amassed a huge fortune. But unfortunately that couldn't be further from the truth - in fact I ended up losing a significant sum!
At the time I was working in the ATM team a large New Zealand bank. My manager had heard about this digital currency called bitcoin, and wanted to know more about it and whether it posed a threat to the business. It was my job to do some investigative work and report back. As I delved into the crypto world it didn't take long to realise that bitcoin was an absolute game changer. I reported back to my manager with the bad news for the bank. My conclusion was that bitcoin was indeed a threat due to the decentralised nature of the currency, enabling users to perform financial transactions without the need for a central banking authority. I also added that although there was nothing the bank could do to stop it, suggesting the best course of action would be to embrace blockchain technology to improve its own business processes.
Even though my report was finished, my interest in bitcoin had only just begun. I set myself a goal was to accumulate as many bitcoins as possible in the next 6 months, and hatched the perfect plan! I purchased two small S1 Antminer rigs for 2.6 BTC and ran them for a month. This 'pilot' proved relatively successful, although not as well as I hoped for, particularly after factoring in electricity costs. However based on the results I decided to go all IN! I purchased four Terahash miners - more than 10 times my current capacity! These 19-inch rack-mountable servers were going to make me rich! The cost of 27 bitcoins seemed like a pretty solid investment with a payback period of less than 6 months. But unfortunately, thats when it all went pear-shaped. The miners I ordered were 'off the plan' and I had not fully comprehended what that actually meant. What it meant was they hadn't even been developed! So after countless cycles of design-build-test phases by the manufacturer, the miners finally arrived - albeit 12 months later. By that stage though, mining pools and hashing power had grown exponentially to the point where my miners weren't even covering the cost of the electricity to run them. Eventually I made the hard decision to pull the plug on the whole operation and shut it down.
Lessons learned
- A fool and his money are soon parted. Don't invest more than you can afford to lose
- Read the fineprint and don't buy mining machines off the plans. Timing was critical and my miners were redundant before I even received them
- After this experience I wouldn't go near mining, other than to learn about and experience it. Unless you get free electricity or close to it, you won't be able to complete with commercial mining operations.
Do you have a similar story? Feel free to post it below.
That's so much Bitcoin to lose on fine print man, my condolences!
yep and the higher the bitcoin price goes, the sadder I get lol. And it was still a decent amount of cash even back then
Dang. Tough loss. Great gains come out of failure. You learned a lesson you won't forget and the crypto scene is just getting started. You're still early. It's good you took that hit while there is still plenty of time to recover. Keep postin!
Excellent
Ouch, that's a sad story man. I would have been pretty furious honestly haha. You can always buy and hold, cloud mine and mine with a gaming rig. All three at the same can bring in a good return
haha yeah if only I had bought and held. I'm not even going to look at what 27 bitcoins would be worth now :(
I dumped over 1000 ETH within a couple of hours of the DAO hack. Maybe I got $14 or $15 per ETH. I try not to think about it; would probably do it again. I owned 7000 LTC as late as last year. Now, I'm down to about 40.
Hindsight is 20-20.
Wow! I've made a nice sum investing in various crypto and you've really changed my mind with this post. I was seriously considering at one point of going all in on mining, but from everything I'm reading, the mining game can change on a dime. Specifically, I'm talking about Proof of Stake or DAG size.
Thanks so much for your insight here! Really enjoyed reading your story.
Thanks man. Glad to hear someone out there is making some good coin. I haven't looked at PoS mining but presumably you're electricity costs aren't as high. Anyway always worth looking at the numbers - miners run a pretty critical function!
Sad story.
Buy and hodl. The crypto story is a long way from over.
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STOPThanks for sharing your history. Good summary of Lessons Learn.
Upvoted and following! feel free to do so with me as well