A recent spike in Bitcoin value during the last few months increases the general public interest in it. However, according to junior Ashutosh Bhown, who invests in Bitcoin, investing in Bitcoin is still risky business. “It [the value of Bitcoin] went from $18,000 but dropped to $14,000 a few days ago,” Bhown said. “High risk, high reward.” Photo courtesy of Bitcoin.
Many high school students work jobs outside of school as a way of earning some extra cash, but some Palo Alto High School students see financial opportunities in mining and investing in cryptocurrencies like Bitcoin.
Junior Ashutosh Bhown, who began investing in Bitcoin a few years ago, described Bitcoin as a digital currency that can be used to buy things via virtual transaction, similar to Apple Pay.
“I was introduced to stocks a couple of years ago and I got interested in economics,” Bhown said. “More recently, my dad, who’s a crypto/blockchain nerd, suggested I buy some Bitcoin.”
According to Bhown, Bitcoin investment appealed to him more than investing in stocks because its price has a tendency to fluctuate. “The volatilities of cryptocurrencies like Bitcoin allow you to get a lot of value in a short time,” Bhown said.
Statistics on Bitcoin’s value support Bhown’s statement. Bitcoins were worth $5,960 a few months ago, according to the charts on Bitcoin’s website. Now, they are worth nearly $17,300. According to Bhown, the value of Bitcoin increases with “faith.” This means that when more people believe that Bitcoin’s price will grow, they buy more of it. This causes the prices of the currency to shoot up.
Bhown said he chose to invest in Bitcoin instead of mining Bitcoin because a good mining setup would cost thousands of dollars. “Maybe when I have profit I can actually get a rig, but for now I’ll just buy Bitcoin,” Bhown said.
Like Bhown, senior Ryan Dickson trades Bitcoin, “but with the recent spike in prices, I saw an opportunity to start mining as well,” Dickson said.
According to Dickson, at the moment, mining is much more profitable than trading. “$500 worth of computer hardware can generate up to $20 a day, meeting Return On Investment in only 25 days,” Dickson said. “Afterwards, so long as power isn’t an issue, thats $600 a month earned from simply plugging the device into the wall.”
While investing, he “only ever invested in a coin when I was in a financially stable position, and never spent more than I was willing to lose,” Dickson said. According to Dickson, he has made around $700 from trading over the last year.
Paly alumni Max Bernstein mined a different cryptocurrency called Dogecoin during his time at Paly. According to Bernstein, he used the computers in the robotics lab to mine Dogecoin for the robotics team over the course of a few weeks.
“Last week I heard that Doge was worth around 100 times more than when we were mining. Lo and behold — the 103,000 Doge we mined was worth $1500,” Bernstein said.
According to Bernstein, he could have mined more, “but the district IT was for some reason intent on shutting it down. So it didn’t last long,” Bernstein said.