In any gold rush, and Bitcoin is decidedly one of those, there are the people who get in early and win. And the Winklevoss twins, best known for suing Mark Zuckerberg and walking away with millions to settle the case, decidedly got in early on the Bitcoin scene.
The Winklevoss twins bought $11 million worth of Bitcoin and sat on it, and, well, that paid off, according to the Verge:
Cameron and Tyler Winklevoss won $65 million from the Facebook lawsuit, and invested $11 million of their payout into Bitcoin in 2013, amassing one of the largest portfolios of Bitcoin in the world — 1 percent of the entire currency’s dollar value equivalent, said the twins at the time. Their slice of the Bitcoin pie is now worth over $1 billion after Bitcoin surged past $10,000 last week to now trade at $11,100, according to CoinDesk. The cryptocurrency has surged over 10,000 percent since the Winklevoss’ investment, when one coin traded at around $120.
Not a bad return, although we’d point out the Winklevosses wisely kept $54 million of their lawsuit win for other investments. But this does raise the question: Can they keep this billion? Bitcoin price has been going through the roof, as media hype about it has built up. In part, that’s due to businesses using other aspects of the technology; there’s a lot of hype about the blockchain, essentially a method of giving everybody the same ledger of Bitcoin transactions to ensure the currency isn’t forged, not to mention general media chatter about, well, things like the Winklevoss twins making a billion dollars.
So, is there a potential for other investors to become Bitcoin billionaires? Maybe. Bitcoin appears to be fueled, at the moment, by the belief that the only place for Bitcoin to go is up, but we’ve seen overheated markets before. It wasn’t so long ago that the financial fad for flipping houses caused a massive economic crash, after all. Bitcoin isn’t quite so nasty in its consequences, but it’s a lot easier to remember the winners of a gold rush than it is to remember the losers. Nothing rises forever: hype dies down, markets get saturated, or flaws are revealed in what seemed to be a bulletproof get-rich-quick scheme.
Bitcoin is a fascinating financial and social experiment, but if you’re seeking security, it’s not ready to be your ticket just yet… unless you’re a Winklevoss.
(via The Verge)