What are cryptocurrencies?

How this Bitcoin investor lost $3 million with one mistake

SAM Karagiozis has always been a big believer in bitcoin.

And he was prepared to put his money where his mouth is, investing $15 million to roll out the first ever nationwide network of bitcoin ATMs several years ago through one of his companies, Auscoin.

He was also one of the earlier cryptocurrency investors, snapping it up for a steal and sitting back as its value soared to a peak of about $27,000.

But then, the crash happened.

The initial hype surrounding "overnight bitcoin millionaires" caused the value of the cryptocurrency to skyrocket, only to drop after early investors cashed out and later investors started to panic.

Today, one bitcoin is worth $4946 - and Mr Karagiozis, a self-described "hustler" who dropped out of school at 15 and flipped burgers at McDonald's before becoming a property investor and "serial entrepreneur", estimates he's lost around $3 million as a result.

"I was an early investor - I've been investing in bitcoin for five years now, and the value of the bitcoin I'm holding, from its peak to this week, has dropped by about $3 million," he told news.com.au.

"But I'm still holding the same amount of cryptocurrency as I was 18 months ago - it's just worth less."

Sam Karagiozis says he has lost a total of $5 million across crypto and property investments. Picture: Zak Simmonds
Sam Karagiozis says he has lost a total of $5 million across crypto and property investments. Picture: Zak Simmonds

While most of us would consider not cashing out at the optimal time and copping a $3 million loss as a result to be a fairly big mistake, Mr Karagiozis is determinedly optimistic.

"Let's be real, it would be a lot nicer if it hadn't dropped in value - I'm not going to sit here and say it doesn't bother me - but at the end of the day I believe in the long term … I only ever put in what I could afford to lose," he said.

"As a business owner I go through risks on a daily basis and I have decided to invest X amount into crypto, which is what I've done, and at the end of the day I've had a loss on profit, not a loss on investments."

Mr Karagiozis said despite his eye-watering loss, he was confident it would recover - but urged potential bitcoin investors to always do their research and to invest sensibly.

"It's definitely not the first time it had dropped - for instance, in the past it hit $1200 and dropped to $100 a few years ago, which was a huge drop. It does have a history of dying and resurrecting again," he said.

"I'm definitely confident bitcoin will get back to where it once peaked and it will more than likely pass that again - however, I don't think that will happen within a six-month period.

"I think it will be more slow and steady than it was in 2017 and I wouldn't be surprised if it didn't go above $8000 this year."

Sam Karagiozis describes himself as a ‘serial entrepreneur’. Picture: Supplied
Sam Karagiozis describes himself as a ‘serial entrepreneur’. Picture: Supplied

It's not just bitcoin that has caused Mr Karagiozis' profits to take a hit - he estimates he has also lost a further $2 million thanks to Australia's housing market downturn.

In just one example, he told news.com.au he had sold one Melbourne property 18 months ago for around $720,000, but recently sold a near-identical property for just $573,000.

However, like bitcoin, he said he was confident our housing market would bounce back.

"In the long term, property always goes up in value in Australia and in Melbourne for sure," he said.

"It doesn't affect my plans going forward.

"The last 18 months across property, crypto and stocks have been incredibly strange so if you're in a position to hold onto any of those three assets and can afford to, then I think you should avoid selling it at a loss and consider your options. That's not to say it won't drop more, but don't rush into anything based on emotions because that's always the worst thing to do.

"Life's tough, things always knock you down, but you just have to deal with in and move on and keep pushing forward, otherwise you'd get nothing done."

Last February, Mr Karagiozis made headlines after a 60 Minutes report suggested Auscoin was a "money grab" built on little more than "grandiose promises".

"Calling it a blatant scam with zero evidence is detrimental … Auscoin is the backbone of my life and reputation right now," he told news.com.au at the time.

"This is what I do, whatever advice I give people, their success is my success."

 

Continue the conversation @carey_alexis | alexis.carey@news.com.au


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