I Just Found $1,013 in Bitcoin That I Didn’t Know I Had
My story highlights the challenges with storing and managing cryptocurrencies
I’ve been writing a lot about cryptocurrency mining recently. I’m not a professional miner — I’m a journalist and experimenter. But there’s been a lot of interest in my story about mining a little Bitcoin on any PC.
How to Mine a Little Bitcoin on Nearly Any PC
How to experiment with Bitcoin without the risk of losing your house
And the Wall Street Journal and TWiT covered my experiments with using cryptocurrency waste heat to keep my backyard chickens (and a tomato greenhouse) toasty in the winter.
Wanting to share a complete Bill of Materials and cost breakdown for my cryptocurrency mining rig, I recently logged into an old Nicehash account to check some mining statistics. I got a big surprise when I found that the account contained $1,013.71 in Bitcoin that I didn’t know I had.
At first, I didn’t even realize it was mine. I saw the $1,013.71 number on the screen, and at first I thought it was the current price of a Bitcoin. “Wow” I remember thinking, “Bitcoin was just at $55,000 per coin! It sure has dropped a lot if it’s suddenly at $1,013!” Nope. Bitcoin has come down a bit in price, but it’s still valued at $48,000 per coin as I write this. And that huge price move is part of why my account happened to contain over $1,000 in Bitcoin that I didn’t know I even had.
After some sleuthing, I found that the mystery Bitcoins were generated in an experiment I did in 2018 on heating my home with cryptocurrency mining.
I used a mining computer as a high-tech space heater, and concluded that using heat from a mining computer for productive purposes was a viable undertaking. It was that proof of concept which later led to my tomato and chicken experiments.
When I did my space heater experiment, I ran my mining rig for an entire winter. But at the time in 2018, Bitcoin wasn’t worth much. My rig only generated around $0.76 per day of the cryptocurrency, and each coin was only valued at about $3,500. Since I only expected my account to contain less than $100, I never bothered to cash out the coins I was creating — my focus was more on the data I was gathering, anyway, and not on actual profits, so I just kind of forgot that the coins were there.
Fast forward a few years, and Bitcoin has gone up in value by a factor of about 13x. So too, has the little chunk of Bitcoin my experiment yielded, and which I never bothered to cash out at the time. The tiny amount of coins I made by running my space heater experiment are now worth over $1,000.
My experience highlights a few important things about cryptocurrencies. For one thing, they’re volatile. Bitcoin and other crypto coins can swing wildly in value from day to day or week to week, and the swings are unpredictable. Some people have likely made a lot of money buying Bitcoin, and others have likely lost fortunes.
In my case, my initial costs were just the costs involved in building my rig and the electric power used to run it, so my risk was pretty low. And it turns out the upside was high. But I could just as easily have mined coins now, and had the price drop dramatically. Much of it comes down to luck, and here luck was on my side.
My discovery also highlights the challenges of properly holding and managing cryptocurrencies. These coins are in their infancy as a form of currency, and the best ways to secure, manage, regulate and track them are still being worked out. Stories abound of people who have been locked out of Bitcoin fortunes worth upwards of $100 million because they forget their password to an account or hard drive. Overall, about 20% of all Bitcoin is reportedly in locked wallets, which users have either forgotten about or lost.
My story about forgotten Bitcoin happens to be a positive one. But with one forgotten password or misplaced thumb drive, fortunes in crypto can be lost forever. It’s much harder to lose other assets worth millions of dollars— like gold bricks, say, or or a house.
Remember that cryptocurrencies are unpredictable, and holding them is not for everyone. Check with your financial advisor before you invest in anything new, Bitcoin included. But if you do choose to hold cryptocurrencies, remember this: whatever you do, hold onto your password!
Nothing in this article should be construed as providing investment advice. Consult your financial advisor or other professional advisor before investing in cryptocurrencies or any other monetary instrument.