Financial Information Platform

Home sweet hodl: How a Bitcoiner used BTC to buy his mom a house

Jaime A. bought $30,000 worth of Bitcoin in 2011

0 2

In 2011, Bitcoin was trading around $30. This means that $30,000 in BTC would have been equivalent to 1,000 BTC.

Fast-forward eight years: the value of Bitcoin has grown exponentially, and as of this writing is at a record high of over $6,400 per coin. Therefore Jaime’s 1,000 BTC is now worth just under $6.5 million — enough to buy his mom a house in one of the most expensive cities in the U.S., with plenty left over for more Bitcoin investments or anything else he might like to buy.

But how did Jaime A. have enough money laying around to invest in Bitcoin? And what other investment opportunities could he have pursued with that capital?

Jaime A. got into crypto during the Silk Road days

You can trace Jaime A.’s interest in Bitcoin back to his Silk Road days, when he was a teenager who used the Deep Web market to buy and sell his wares.

During this time, Mt. Gox—a Tokyo-based cryptocurrency exchange—was shut down by the FBI after hackers stole millions of bitcoins; at one point, it was responsible for handling 70% of all Bitcoin transactions worldwide. Jaime A. watched in horror as the value of BTC plummeted from US$1,200 to US$99 between 2013 and 2014—he lost a lot of money during this period because he chose not to convert his money into fiat currency when things took a turn for the worse.

However, he stuck with Bitcoin throughout these highs and lows because he believed that cryptocurrencies would disrupt traditional financial institutions on a global scale and usher in an era where freedom from banks was possible for everyone:

“I think that using cryptocurrency is an option; you don’t have to use it if you don’t want to—it’s like having a savings account or checking account; everybody should have their own bank within themselves instead of relying on other institutions… With cryptocurrency there are no borders, no limitations, no exclusivity—it’s more democratic than political elections that happen every four years and it removes any biases based on race or gender or anything like that.”

Jaime A. says his mother suspected there was a catch

 

His mother was reluctant to accept the money.“She knows that there is no free lunch, so she thought I had a catch,” Jaime A. told The Defiant. “She wanted to know if it was legal and if it was safe and if she would get arrested or something like that.”

But after multiple conversations and doing her own research, his mother began to understand Bitcoin better and grew more comfortable with it. In fact, she became intrigued by Bitcoin after reading about the technology and how it works — but not enough to buy in herself (yet).

Jaime A.’s mom paid him back using her savings

 

Jaime A.’s mom paid him back using her savings, meaning the money was used to pay back the debt on the house. She didn’t understand the significance of the transaction, but she was happy to do so. In Jaime A.’s words: “She didn’t want me to be at a loss because I believe in this crazy idea that is Bitcoin.”

That said, Jaime A.’s mom repaid him with interest: she sent him a check for US$9,700 — his $8,000 plus an extra $1,700 as a thank you. As he explains:

Jamie A. called his mother and warned her she needed to unplug five laptops and a router in her home

 

Being a mother to a cryptocurrency enthusiast is not without its risks. For instance, if your son or daughter is one of these people, you may find yourself in the position of having to turn off your laptop and unplug your router at random intervals for no reason that seems immediately clear to you.

If this happens to you, it’s important not to panic (though it’s also fine—and even recommended—to ask some probing questions). Your child has most likely just discovered that someone is using your electricity and internet bandwidth to mine cryptocurrencies like Bitcoin on your computer without asking for permission first.

This will sound confusing if you’re someone who isn’t familiar with the concept of digital currencies, but let me try and put what happened into simpler terms: Some bad person was making money off of you without asking, which is never OK.

Leave A Reply

Your email address will not be published.