With Bitcoin, you can make millions. At least, that’s what you hear about all the time. There are people who have made millions in a short space of time, and others who have lost everything.
But rarely do you hear of someone who dares to take financial risk as consciously as our protagonist of the story. With a bold plan, a fair amount of courage – some call it stupidity – and an unwavering conviction, he decided to take out $125,000 in loans to buy 4.5 Bitcoin.
Two years and six months later, he has a profit of 99%. But the path to this point was anything but easy and contains a number of lessons.
The strategy: From loans to crypto
The story begins about two and a half years ago. Our protagonist, let’s call him “Max”, was convinced that Bitcoin was an unbeatable investment. While most people wonder how they can stretch the next paycheck to the end of the month, Max was thinking about how he could get more money in his hand to buy even more Bitcoin.
And what does he think when his own money is not enough? I’ll take out a loan!
Max decided to take out around $125,000 in personal loans and credit card debt. He does this through credit card balance transfers.
A balance transfer is a way to transfer debt from one credit card to another, often with a low or even 0% interest period for a period of time. Sound risky? That is it tooBut Max had a plan.
Why not just rely on your savings?
One of the most common questions Max is asked is: Why didn’t you just invest the money you made in Bitcoin instead of going into debt? The answer to that is astonishingly simple: It simply wouldn’t have been enoughIf you are convinced that an asset is undervalued and you believe it will rise in the future, then you want to buy as much of it as possible – preferably before everyone else gets the idea.
Max realized that the bear market was in full swing and prices were low. For him, it was the perfect opportunity to buy big. So instead of investing a little bit of his salary in Bitcoin every month, he took on the debt to buy a larger amount immediately. He calls this “reverse dollar-cost averaging.” Instead of continually buying small amounts as the price rose or fell, he paid off his loans while the price of Bitcoin rose. A clever, if risky, strategy.
A speculative attack on the US dollar
Many people think it’s crazy to go into debt to invest in Bitcoin. But Max sees it differently. For him, it’s a speculative attack on the US dollar itself. In his view, the US government is trapped in an endless spiral of money printing, which leads to progressive inflation and continuously weakens the value of the dollar. Bitcoin, on the other hand, according to Max, is an “inelastic” asset, meaning its supply is limited and cannot be easily increased.
His plan was simple: he took out dollar loans that he thought would lose value and used them to buy bitcoin that he was convinced would increase in value. Financial strategy can be that simple, right? Well, it’s not that simple. This strategy is very risky. If the price of bitcoin had fallen, Max would have been stuck with his debt and lost a lot of his money.
The Risk: Is Max a gambler?
Critics will surely cry out at this point: “That’s crazy! This is not an investment, this is gambling!” And yes, it’s true, the risk was high. But Max sees it differently. For him, it was not gambling, but a well-considered bet on the long-term success of Bitcoin and the decline of the dollar. As with any investment, only those who take risks have the chance of high profits. And Max was willing to take this risk. He had a plan, he could easily cover the monthly payments from his regular income, and he was willing to invest for the long term.
So Max didn’t rush into the adventure blindly, but thought through his approach carefully. That’s what we can say now, looking back. Or: he was lucky.
The result: A profit of 99%
Now, two and a half years later, the tally looks pretty impressive. The average price Max paid for his 4.5 bitcoin is about $29,550 per bitcoin. That brings his total stake to about $133,000. And today, August 16, the value of that bitcoin is about $265,000. That’s a profit of about 99%, or $132,500 in dollars. Not bad for someone who financed the whole thing on credit, right?
And the best part: Max has already paid off all his personal loans and now only pays on balance transfers, which also incur no additional costs thanks to 0% interest for the next 18 months. If all goes according to plan, he will be debt-free by the summer of 2025 – unless he decides to take out even more loans to buy more Bitcoin.
However, we hope he doesn’t do that.
An important lesson: Playing with fire
Max’s story is impressive, but it is also an important reminder that investing always involves risk. Max did not simply trade on a whim; he followed a clear strategy. The fact that it is more than quite risky is another matter.
Taking out loans to invest in volatile assets like Bitcoin is certainly not for the faint of heart. It’s playing with fire – and sometimes you get burned.
Max himself openly admits that his strategy is risky. “This is not financial advice,” he emphasizes in his post. And it isn’t.
What can we learn from Max?
While most of us probably aren’t willing to borrow $125,000 to invest in Bitcoin – which is a very good and smart thing to do – there are still some lessons we can learn from Max’s story.
- Have a plan: Max had a clear strategy and a clear goal in mind. He knew what he was doing and was prepared to accept the consequences if his plan failed.
- Understand the risk: Max was fully aware of the risks of his decision. He was willing to take the risk because he believed in his plan and his thesis. This does not mean that it is the right decision for everyone, but it shows how important it is to know the risks and to be able to weigh them up.
- Think long term: Max was prepared to invest for the long term from the beginning. He had no illusions about getting rich quick, but was prepared to wait several years to realize the full value of his investment.
- Use the system to your advantage: Max has taken advantage of his personal circumstances to achieve his goals. He has taken advantage of low interest rates and balance transfers to finance his investments. This shows that you have to know the rules to play the game successfully.
- Stay flexible: Although Max had a clear plan, he was also flexible enough to adapt to changes. He kept an eye on his debts and paid them off on time so as not to pay unnecessary interest. He also had the money because he could and can pay it off.
Conclusion: risky decisions, big profits?
Max’s story shows that sometimes the boldest decisions can bring the greatest rewards – provided you’re willing to take the risk and accept the consequences. But it also reminds us that investing is always associated with uncertainty and that you should never risk more than you’re willing to lose.
It remains to be seen whether Max’s bet on Bitcoin and against the US dollar will pay off in the long term. The next bear market is sure to come.
But one thing is certain: he has shown that with a clear strategy and a bit of courage, you can achieve great success even in an uncertain world. But let’s remember that this is not a blueprint for everyone; it’s more of a crazy story.
And so all that remains for us to say is: hats off to you, Max, and good luck for the future – may your Bitcoin stack continue to grow and your loans soon be history.
PS. This story is true and on Reddit to find.
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