I’ve always been an early adopter when it comes to new technology. Back in about Sept 2012 I decided to get involved in this new thing they called Bitcoin. For me it was all about trying to understand the technology, so I did some rresearch. I found a nice website that you could calculate the estimated earnings from a Bitcoin mining machine. This allowed me to compare different machines and make an educated decision on what to buy. I ended up spending $60 on this little beauty. Or at least that’s what the company said it would look like.
The company was called “Butterfly Labs” and they did deliver a product. But it wasn’t in the same “coaster sized” form factor. They actually offered to give people their money back, but the real product wasn’t that bad-looking … Just taller. I believe they had called this tiny thing the “Jalapeno”.
Looking back at this thing, I have no idea what designer in their right mind would have thought that all the processing boards and fans would fit in this cute little rendering … It was probably a marketing gimmick I’m sure. But the machine eventually delivered. It was late, but so is every project like this, so I didn’t complain too much.
The image to the right is what it looked like in the end. Not too bad. I actually thought it was very well designed. This little device sat at my desk in my Vancouver downtown apartment humming away. The hum wasn’t too bad. It was tolerable in the room next door to my bedroom.
When I finally got it setup on a mining pool, this little beast was making me about $10/day back when the Bitcoins were worth about $85/BTC. I think I ran this thing for about 3 months and netted about $1,000 then. After about 3 months, the cost of electricity to run this machine far exceeded the return it made. This was due to the Bitcoin network “difficulty” rising (Since more people & companies were added to the network, my share of the pie was diminishing).
In early Jan 2014, I decided that I would take my Bitcoin earnings and invest it back into a more powerful machine: the “Monarch”. In order to buy one, I had to send the company my Bitcoins first, and then they would eventually send me this new more powerful machine. I was patient, but It wasn’t long until the FTC froze all the company’s assets while they were taken to court. So, my Bitcoins were in a holdings account for quite some time. I wasn’t too worried, since to me, this was still just my original $60 investment.
In Sept 2015, I received an email from Butterfly Labs saying that the FTC had lifted the freeze and that they were offering to complete the manufacturing, or if I decide to, they would just send me back my Bitcoins. At that point I was over the whole mining thing … So I took the Bitcoins. Still not worst very much, but at least I got my money back with a little bit of interest.
From Sept 2015 to about June 2017 my Bitcoins lived in my Offline Bitcoin wallet on my phone. I somehow managed to never lose or break them through many phone upgrades (ya, that was a miracle, I know). All this time I just watched as my Bitcoins went from $100, to $500, to $1000, to $5000, to $10,000 … and finally to $20,000 each. When my digital currency outmatched my retirement fund, that’s when I started looking into a better way to store these funds.
I invested into an offline crypto wallet called Trezor. Basically a little dongle that keeps the convenience of having your coins on your phone, but without all the risk, since it’s a separate dongle that has a lot more security and you can also store it safely instead of carrying it around with you all the time. Here’s what it looks like:
I’ve kept this thing safely hidden away, but always near me. I also like how I can use an app called “Mycelium” to view my accounts offline without spending them unless I attach this little dongle to my phone. After attaching it, I can spend my BTC just as if I had them stored on my phone. Simple, convenient, effective.
Now, I’ve used BTC to buy stuff online, but really not very much. I think that most people are just holding onto Bitcoins and then waiting for more people to buy into it so that the value appreciates. This was great, but Now that Bitcoin is pretty much fully mainstream, mass adoption is almost complete. This has caused the issues that plague the BTC technology to surface. BTC was not meant to be scaled up this much. If I wanted to buy a coffee with BTC today, it would cost me almost $50 in fees just to process that transaction depending on how fast I want the network to process it.
Some time ago, this issue was already resolved. In order to resolve it the Bitcoin technology split the chain into BTC (the original) and BCH (Bitcoin Cash). BCH was designed with scalability in mind. With the idea that transaction should only be pennies on the dollar. The good news is that anyone who owns BTC was allotted the same amount of BCH. As of today BCH is worth about $1,500/BCH. But I do believe that this new currency will be a lot more useful than the Original BTC.
This is why I decided to cash out of BTC. I’ve doubled my BCH holdings and cashed out the rest back into CAD. It may be the wrong choice, who knows. But I’ve rode the wave far enough for now. I’m happy with the investment and I think I could use the CAD in a better way that just letting it sit while it goes up and down with the BTC value.
That is my Bitcoin story. I will update this post if anything new comes up.
Thanks for reading!