Three times unlucky for Bitcoin investor

AUCKLAND: Adrian Clarke might be New Zealand’s unluckiest cryptocurrency investor. A trio of cryptocurrency misfortunes have cost him somewhere north of $110,000.

Last week, the New York

reported that about one in five Bitcoin wallets, holding some $240 billion in fiat currency, are now inaccessible, mostly due to lost passwords (unlike a traditional bank, a crypto exchange can not help you if you forget your logon).

One hapless punter, San Francisco programmer Stefan Thomas — who won a stash of 7000 Bitcoins 10 years ago, when the virtual currency was worth about $US2 — has two guesses left to figure out a password that will unlock an account now worth about $US220 million. If he fails, his account will be encrypted and inaccessible forever.

Mr Clarke — a senior engineer with one of New Zealand’s big three phone companies — is not in the same league. But speaking to the Herald from the Ellerslie Novotel, where he is sitting in managed isolation following a trip to the UK, he outlined what is nonetheless a poor streak of luck.

His adventures in Bitcoin started in 2014, when he bought a handful of coins via Japanbased Mt Gox — at the time, the world’s largest Bitcoin exchange.

‘‘You could buy a beer at the Dog’s Bollix [a central Auckland pub] with Bitcoin. It was all a bit of a lark,’’ he said.

But the same year, Mt Gox went under after the theft of some 744,000 Bitcoins (the Japanese exchange’s demise also hit headlines here, given it held about $43 million in frozen accounts related to New

Zealandregistered Bitcoinica, which gained the ignominy of becoming one of the first cryptoexchanges to fall over in 2012 after hackers stole just under 19,000 coins and deleted users’ customer records and balances).

Mr Clarke was philosophical. His couple of coins in Mt Gox were worth about $700.

The telco engineer still had one Bitcoin on a USB key.

Alas, that was lost, too, as he forgot the password and, at some point, lost the thumb drive.

At the time, the loss of the coin seemed no big deal. But over the past few years — bar some swoons — the value of the digital currency has climbed.

Over the past month, it doubled in value. Even allowing for a dip last week, Clarke’s single Bitcoin is worth some $52,000. But wait, there’s more.

About 2015, Mr Clarke roped in some friends for a project to ‘‘mine’’ or create 20 to 30 bitcoins, after gaining access to some ASICs (ApplicationSpecific Integrated Circuit chips) used for the ultraintensive computing process involved.

They ultimately abandoned the project, calculating that it would generate higher power bills than the coins would have been worth at their 2015 value (which was in the $400$650 range).

But given the way Bitcoin’s value took off over the next few years, he could have cleared a profit of at least $60,000 from the mining venture, Mr Clarke said.

Does the loss of the Bitcoin on the thumb drive or the neverwas mining project play on his mind?

‘‘No. If you’ve never had something, you don’t miss it.’’ — The New Zealand Herald