My Most Shitty Investment Ever — How I Lost $50,000 Overnight 🔥

in #hive-1260093 months ago (edited)

Dear Hivers,

For those of you who don’t know:

There is a challenge organised by @trumpman to share your bad investments. As I was reading some of those messed up investments, @resiliencia nominated me.

Right away, I dropped a comment sharing my story — and then hours later I said to myself:

Everyone should know THIS epic story. And in detail.

That is why I am writing this article. In fact, you may want to read this two reasons:

  • First, this story is like a movie drama — filled with action, suspense, and absolute mystery even today.

  • Second, there is a valuable life lesson. You may probably find them as you go through the story.

ShittyCryptoInvestment.png

Before we start, let's see the end:

Most altcoins have been terrible since 2017. Some of them went down by 70%, 80%, 99%… and even 99.9%.

But mine?

It went from $50,000 to $0 overnight. The price of the token is now worthless. It is sitting here as you can see:

TokenInvestment.png

There are also other several tokens (not in the screenshot) that are worth few thousands of dollars. It is not about liquidity. None of them can be sold outside because they are “native” tokens.

How did this happen?

In fact, I still remember it like yesterday. The picture is crystal clear in my head.

I was sitting in a conference room discussing trading strategies with someone — and WeChat app on my phone started buzzing with new messages.

One of the message was: “We should find him and KILL him right now.

Everyone’s blood was boiling. I didn’t know what was going on and I was in the middle of the conference. Yet those messages were too important for me to neglect — who are they talking about anyway?

So I walked out of the room and opened my laptop to find this:

TokenInvestment.png

Wow.

  • $130 million dollars
  • Unable to process withdrawal.
  • Gap of 7000 to 13000 bitcoin

In short: a complete exit scam.

Damn.

I closed my laptop — slid my phone into my pocket — and stood in complete silence. All the money GONE. My mind was blank. And a part of my soul was crushed.

I remember walking to the office terrace and seeing those white clouds turn dark. It was all in my head. In fact, my world collapsed. Those dreams shattered.

To make it worse:

I wasn’t alone.

If anything, I was a tiny drop in the big ocean. I knew some of those big time investors who poured in hundreds of thousands of dollars — some even millions. And to know everything is wiped out overnight was heart-breaking.

But there is a twist to the story. You see, this was more than another exit scam. It was a failure from two sides — one belongs to the community and the other to the founder.

You should know about this founder.


HiveTitle1.png


Mr. Zhang Jian was the founder of the exchange. He is a popular figure who published a book on blockchain.

Then turned into the CTO of Huobi (Hive is listed there).

He even built a bitcoin explorer website that received tremendous attention all over China.

And when he knew he couldn’t be wrong?

He launched FCoin — the exchange — receiving millions of dollars in investment from big players. This guy literally won dreams.

Template6 copy 1.png

It gets better:

FCoin also did a whopping $17 billion dollar volume in a SINGLE day. I think it is a record even to this date. The exchange was a true rockstar — and people like Changpeng Zhao from Binance hated this. They even tweeted against the FCoin’s innovative model.

This model was called Trans-fee Mining — a “new” mechanism invented by the founder.

You see, at this point, Zhang Jian is one geeky genius dude from China. The exchange also incorporated DPoS mechanism while making token holders the owners — and gave away 80% of the daily income.

Because the volume was insanely large, people earned a lot of money in the initial days. The company itself booked $150 million profit in its first month.

Perfect crypto life.

In fact, it can't get any better than this.


HiveTitle1.png


The native token (FT) did over 100x in the first month creating several millionaires. In between this, your friend Sidwrites enters.

He sees the token — the exchange — the whitepaper — the dividends — and does a lot of research. Plus, as a lifelong advocate of passive income, he invested at 50 cents — then at 30 — and slowly at the bottom.

I remember earning $300 to $500 per day for holding the tokens. Only for a couple of days though. No — it wasn't Bitconnect. Just that the exchange volume was huge.

I reinvested and continued doing this until the community decided to change the mechanism — they requested to burn the tokens — and the dividends slowly dried up. Less returns are better many thought.

Still the tokens were valuable. At 30 cents, my tokens were worth $75000 at least.

TokenInvestment.png

This was the worst part:

The DPoS mechanism (community voting) turned against the exchange though. What the community decided was good — wasn’t actually good. But the decision was done and the plan executed.

And so the exchange went silent for the next 9 months.

Everything seemed normal. Decent volume with washtrading.

Then the community also created a new proposal to buyback the token — to increase the value of FT. The buyback was done by the founder from his $150 million dollar (which he revealed later).

Anyway, there were few issues here and there but nothing significant. The founder knew the community can’t innovate.

That is why he created another new mechanism to lift the token's value. A new public chain was also built. But this genius couldn’t create the impact he once created — and the entire scene turned into an experimental ground until that ONE big day — that day which changed everything:


HiveTitle1.png


This is the mysterious part. It is a puzzle no one can solve.

On February second week, Zhang decided to go against his own team — and decided to burn all the FT tokens. Deep down, community was first. And so the price pumped immediately.

But the team never liked it.

Few hours later, the exchange shuts down.

  • Rumour #1: The angry team decided to destroy all the important files and the entire system. Then mass quit.

  • Rumour #2: The Beijing police found out the FCoin office was operating from Beijing (it is illegal to operate crypto exchange in that city).

Whatever the case was, the exchange was closed without any announcement. It continued for the next one week. As everyone were forming opinions, Zhang then publishes an article:

Template3 copy 31.png

This Chinese article says he would rather share bitter truth than beautiful lies — and shares the entire journey of how a small startup booking $150 million profit lost its way because investors found a loophole.

And this loophole allowed them to withdraw more money than what they actually had.

This “data error” costed $130 million.

And so, in this letter, he decided to say goodbye. He also promised to pay back by starting a new project.


HiveTitle1.png


This is where everything got ugly. His goodbye wasn’t appreciated. And really, I have never seen anything like this.

Remember the message to kill that man? That man was Zhang.

These people were dead serious.

They found his passport — shared all over the place — and even had a bounty on him for a couple of Ethereums and Bitcoins. Most of that was written in Mandarin. But I found one on Twitter:

TokenInvestment.png

If that wasn’t enough:

I saw videos of Chinese people standing outside the police station as Zhang’s wife and family were inside. They were looking for help against these violent investors.

Zhang, of course, was missing.

This was the moment I stopped and started thinking. People can turn into animals for money. Our entire life revolves around this money. We breathe for it. Work for it. And spend our life on it.

To the point: I saw Chinese people writing poetic threats (never seen them before). Then they shared it — on Telegram. Weibo. WeChat. It is filled with every imaginable slangs and threats.

Zhang once again reappeared. This time with a solution.

He handed a couple of million dollars worth of cryptocurency to some key people (called the committee) — and decided to say goodbye until the handover was complete.

Zhang also promised to repay this debt until his death. But no one trusts him anymore.


HiveTitle1.png


Now the exchange is up as FCoin.pro (but no trading). Like Hive, there is no CEO. No leader. And no executive.

Even though it was mentioned $130 million — the debt is actually $185 million. The entire community is also coming together to repay the debt using a new mechanism.

Plus, one of the big time investor took the initiative to rebuild everything. This time, though, with complete transparency by implementing Zero Knowledge Proof mechanism. One can see the number of cryptos held by the exchange against the users asset.

It has been over 5 months now. We are seeing a tiny ray of hope.

First, the debt of the non-native cryptocurrency will be paid. This could take months and years. Then if everything goes well? The native tokens (which I hold) can be redeemed. The price can be a cent — so $50,000 will literally be $2500. Or even a dollar — that would be a quarter million dollar.

For now, they are worth zero.


Few takeaways:


  • What you see is not what reality is.

  • Even the highly sought-after DPoS mechanism can break things.

  • Never assume you know everything. In crypto. And in life.

  • Never associate your self-worth to your investment. (Very important because I questioned myself)

  • Invest with this assumption: “If the money is gone, I will still be okay.”

  • Alway work hard. Because if everything fails, you can at least trust your work ethics.

  • Manage emotions. Feel it. Embrace it. And then let it go.

And with these takeaways, I end this article. I hope and wish you found something valuable in this terrifying story. If you would like to write your own shitty investments, feel free to do so.

Let it out and see them as life’s greatest lessons. In fact, I take all of these as an “expensive education.” It has showed me my true strengths. My ability to face rock bottoms. And still walk out with a smile.

All these events should only makes us stronger. 💪

Cheers,
Sid


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It is so educational to see scams from up close. But $ 50k close? Damn.

Great fuck-up. At least you got this story out of it ;)

Great fuck-up. At least you got this story out of it ;)

You nailed it. I was thinking too. Hell — lucky to experience it early. I know people who lost less than that (in India) and live with that nightmare for the rest of their lives.

I lost. Cringed. Now back extremely motivated. This story is a fuel driving me forward.

Awesome story, man... It would be great that it's not a true...

You should write a screenplay for the future movie... :)

Thank you! I am glad you enjoyed reading it. Wrote with absolute focus as I dug through my memory.

You should write a screenplay for the future movie... :)

So kind of you to say this. If I become one, I am going to ask $50k to start with.

So kind of you to say this. If I become one, I am going to ask $50k to start with.

hahahahahaha... Just to cover up some past-losses... 🤣 🤣 🤣

Like a batman covering up his identity. 🤣

hahahah... kind of that... lol...

Only makes us stronger.

What an incredible story. I didn't think I would read it all but you have a very nice style of presentation. I do hope the price of the token will rise again for you now that there is a glimmer of hope, and I hope you manage to salvage some money from this whole ordeal. Thanks for sharing this post and your advice.

What an incredible story... you have a very nice style of presentation.

I am glad you saw this. Takes a long time to make those graphics as well.

will rise again for you now that there is a glimmer of hope, and I hope you manage to salvage some money

Appreciate your thoughts. Definitely will serve me big time. I would power up here!

I am glad you overcame this with dignity and a proud soul! Congratulations!

As a student of Jim Rohn, do we have any other option?

I don’t have that much to lose... fucking ouch.

I don’t have that much to lose

Same here. Now.

Make it back? I mean... right now I could still like use a hundred bucks. 😂... but seriously.

Make it back? NO.

Make it back 10x? YES. 😂

Let's do it. Anything slowing you down?

I’m broke at the moment... trying to get some crypto’s from here and Musicoin .... I’m also trying to get the Musicoin on the Hive exchange. Think it could help all earn some cheese.

All the best. Let's make ridiculously big goals.

Where are we starting? I’ve created a WAVES token

By relying on efforts. And not just cryptos.

It is what it is. Haha!

Were you ever familiar with trevon james or cryptonick? I sometimes wonder what happened to them.

Yeah! I remember Trevon. Not familiar with cryptonick. Trevon was shilling all kinds of tokens. Was even crying sometimes? I used to see him on Twitter.

Wasn't he from Steemit?

hahah yes, he would cry sometimes and I think he did well on Steemit... you know, until people found out he was a scammer. lol

Cryptonick was a self-proclaimed 17-yr-old millionaire. He shilled all sorts of services and disappeared when bitconnect went down.

Lol @ scammer. You never know the truth! :(

And 17 + millionaire.

Christ.

They might be a joke today but perhaps made their bank account thick. That's one of the thing about crypto - offers luck to the masses.

$50,000! Omg!!! You are strong. I would have died of a heart attack! 😒

Haha! It feels that way but things do get better. I have too many "bad" crypto stories. One at a time!

5 am here. I shared this on Twitter - #posh

Thanks for that! - you made me feel better :)

This one time, I bought $2000 of Smartcash - and not long afterwards it went to the moon.

One afternoon I sat there watching as I made about $10k an hour just watching it climbing.

But I didn't sell it and "lost" about $200k when it crashed.

I felt like a right numpty...

Oh my. A part of me is crushed reading this. I think I remember Smartcash. Not a FUN experience at all. How many times do we wish to go back in time to make a "wise" decision?

It only makes us wiser (or so we think). Between us, let's not make the same mistake again. :)

I know how it feels. Lost 10K$ myself in this scam as well as now I always doubt every startup in crypto space.

I always think of you and your lovely support. We are NOT giving up. Good times are coming!

That's a lot of money! My condolences.
I like your positive attitude though and the takeaways, good luck with 10x. :)

Thank you!

Nothing is lost. Can steal money. But can't steal our hope, can they?

10x should come soon! For both of us.

Next time you make $50k, you send it to me!

If you change your name to Zhang. :D

My last name is Zhang😂

at least you didn't lose 50.001 :P

It's pretty sad though, cause while i was reading it, i thought how easily i and many others could fall victims of this scam

at least you didn't lose 50.001 :P

Look at you! All smart. Haha.

i thought how easily i and many others could fall victims of this scam

Few walked away with millions. Few stayed. Just sheer luck. Can't rely on luck anyway.

also in a way this reminds me the whole sbd thing in steemit, when from 1$ it went around 10$ The ones that knew about it and how long it gonna last, made thousands and millions, most of us though thought that price will still increase more and that will remain for longer, thus ended up pretty much with the same :P

If i recall back then if i had only my sbd out when the price was 10$ i would have around 4k dollars simple as that...

Wow. I remember someone talking about SBD. It was supposed to be pegged to USD. Yet that wasn't the case.

If i recall back then if i had only my sbd out when the price was 10$ i would have around 4k dollars simple as that...

Ouch. When did you sell then?

Heard some horror stories of people with $100k Steem tokens waiting and waiting only to sell at $5k or something. Damn.

yes it was supposed to be something like a stable coin like what hbd is now. the price was mostly 1$ and sometimes it may get to 97 cents or 1,1$ something like this.

But they did something with the amount of sbd existed (i don't really know) and the price skyrocketed to 10$ for a while, dropped to 7-8$ and then stayed forever to 1$ as it should be. I had in total 500sbd that were worth 500$ but with the whole thing happened it worth around 5k.

Because i was greedy and thought the price will increase more i only took out 1k so in a way i won something. But then the price dropped to 1$, i kept most of it till a couple of months ago because i thought that maybe it will go up again but then hive created so i cashed out my sbd in case steem's price go to hell :P

but some people that was behind all of this made millions

I had in total 500sbd that were worth 500$ but with the whole thing happened it worth around 5k.

Damn. 10x right away!

Because i was greedy and thought the price will increase more i only took out 1k so in a way i won something

Haha! Cashing out is the first rule in my book now.

but then hive created so i cashed out my sbd in case steem's price go to hell :P

Haha! At least we know HBD will always come back to $1. So anything above that? We sell next time. :D

but some people that was behind all of this made millions

Yeah! Crypto brings luck to the masses. Someone just said there was this guy Nick who was a millionaire at 17. Imagine that. So many stories. So many hopes.

dang

what a lesson..

Makes us stronger. Makes us stronger.

Thanks for taking the time to participate @sidwrites!
Well, it feels like with all this experiences we have learned something really important for the rest of our lives!

Cheers!

Oh yes. I was listening to a podcast where this real estate guy made $10 million (in assets) in his early 30s. Then the real estate bubble collapsed everything. He said this one of the most "expensive seminar" he ever attended.

Even for us, this is an education — a good expensive seminar.

oh.my.fucking.god

Hehe! Treating this as a valuable lesson.

An amazing story. Dang 50k! Gid please dont let this happen to me, I dont know how i will recover from such loss.

You did have another job then anyway. But dammit, my whole world would have gone to the ground, especially if it was my only source

But dammit, my whole world would have gone to the ground, especially if it was my only source

Hehe. Looking back, I can only laugh at it. Trust me — never thought it would happen to me. It did. And I was in shock.

Add to that — I lost equally more (in total 100k) in only 3 months. Does it hurt? YES. Did I learn something? YES.

Will I repeat it? NEVER.

Good lessons.

Thank you for this highly inspiring investment story - it’s been informative, interesting to read and full of lessons for life. I guess the most important message is in my view: Never put all eggs in one basket, especially not with speculative investments.

Thanks for stopping by.

Never put all eggs in one basket, especially not with speculative investments.

So true. Wonderful advice. This was my third basket, you know. Didn't expect it would end this way! I am definitely learning a lot.

Will be careful with speculative investments.

my worst invest was learning on steem and was a time and growth invest

by a lot of months I was posting without order, sometimes 1 post every two weeks, right now I'm not having a fluent timing but I'm also doing other things that I see valuable for my post and my organic growth altoughright now I'm a bit away of the content creation

every step on life it's a new challenge and it's good to know you had the resilience to work against it

Steem was a learning for sure. What I love is your passion and your involvement on Hive. Your music rocks. I am so glad to connect with you.

YES - we get busy sometimes but to know we are here is good.

And love this:

every step on life it's a new challenge and it's good to know you had the resilience to work against it