This Swedish guy bet all his life savings on bitcoin and it made him 100 times richer – Business Insider Nordic

Four years ago, Swedish expert programmer Alexander Bottema went from deep skepticism to considering bitcoin as an innovation with similar implications as the internet itself. In an exclusive interview, he reveals what happened after he went all in on bitcoin, and shares how other investors can walk in his footsteps.

So did it make him a billionaire?

No, Im not a billionaire yet [in terms of Swedish crowns], says Alexander Bottema, laughing on the phone.

But my capital has grown by a factor of more than one hundred since I sold all my stocks and liquidated my savings in order to buy bitcoins in 2013.

By that time, one bitcoin was worth 30 dollars. Today, almost four years later, the virtual currency is valued at 4000 dollars.

How much savings he had at the time Bottema doesnt want to reveal, but its clear hes content with the investment: his holdings have remained untouched since that day in early 2013.

I consider it a retirement insurance. Im not thinking about buying any more, since I can never get the same return on investment again, he quips.

Alexander Bottema grew up in a small community near Stockholm. He started programming at nine years of age, using the familys Apple 2-computer.

The booming personal computer market made it an exciting time to grow up.

But programming wasnt enough for Alexander Bottema. He wanted to learn more about the theories behind computing. In 1991, he started studying computer science at the renown Uppsala University, where he would later continue as a PhD faculty.

Uppsala turned into Stockholm when he started working on data security and encryption for consultancy Upec Industriteknik. When the company was acquired, Alexander Bottema and his two colleagues started their own company.

Frontec wasnt interested in product development, which we were into at the time, so we decided to start Polytrust. We got financial support from two venture capital firms: Telia Business Innovation and IT Provider.

After Stockholm and Polytrust, Alexander Bottema moved to the U.S. to work for Mathworks, where he is still employed. The Massachussetts-based company provides data analysis and simulation for industrial purposes.

I rejected it as something uninteresting. Seeing that I had a long track record in data security, I was certain that it wouldnt be possible to build safe servers that are open, and envisioned a crash. The following year, I was sitting on the subway and read in the Metro newspaper how bitcoin had recovered after a crash. I couldnt understand how a currency that is built on trust could recover. That piqued my interest.

He downloaded the technical description and the program code for the currency, and used all his knowledge and experience in studying the material.

Alexander Bottemas jaw dropped. His deep skepticism was gone with the wind.

Once he was convinced of bitcoins excellence, he started calculating how much the currency could one day be worth. Like many others, Bottema used the gold market as comparison.

The allocated value of the gold market, where rich people put their money to avoid devaluations, is roughly 8,000 billion dollars. If you divide it by 21 million, which is the number of bitcoins that will be available from the year 2140 onwards, you get 380000 dollars per bitcoin. I ended up on values ranging between 50,000 and 100,000 dollars per bitcoin. I panicked, and bet all of my savings.

What is driving the value of bitcoin, according to Bottema, is the combination of a growing number of use cases, like micropayments, and a limited supply of the currency.

At the outset, he worried most about a ban against the currency but he doesnt consider it a threat any longer.

Isnt there a threat from competing cryptocurrencies?

The first one is the biggest. This is quite similar to the war between VHS and Betamax. Technically speaking, Betamax was better, but VHS was bigger. So even though I theoretically could invent an entirely new internet, it would be very hard to make it grow.

Do you not get worried whenever the currency’s value plummets?

No, I know how the system works and I know what Ive invested in. Sure, the currency dips, but it has always recovered after some time. Bitcoins future looks bright.

Heres how you invest in bitcoin:

Create an account on an exchange, not an intermediary. This will give you the best price. The most accessible one for Swedes is Bitstamp.net.

All bitcoin exchanges are strictly supervised, which means you need to send copies of your ID so as to prevent money laundering.

Send over money to your account using a (European) Sepa-transfer.

Now you are eligible to buy bitcoins.

If youve bought the currency, and your exchange goes bankrupt, its important that your withdraw them.

Transfer them your own bitcoin wallet, for instance Ledger Waller or Blockchain.info.

Its important that you save the code of your wallet on a printed piece of paper or a USB-drive in case your computer would crash or disappear.

When you want to sell, just do the opposite.

Read the original article in Swedish on VA Finans.

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This Swedish guy bet all his life savings on bitcoin and it made him 100 times richer – Business Insider Nordic

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