- Max Urbahn
- Max Urbahn, a student at the University of Connecticut, invested the bulk of his earnings from his summer internship into cryptocurrencies.
- Urbahn invested just over $2,000 into ether and two smaller alternate cryptocurrencies – and made an enormous profit.
When Max Urbahn, 21, decided to invest 80% of his earnings into cryptocurrencies last summer, his family and friends immediately attempted to dissuade him. His father, a savvy investor and business executive who shepherded several companies through their initial public offerings in the past, felt the decision was utterly ludicrous.
“When I told my dad, he said, ‘Max, you’re a f—ing idiot,'” Urbahn said in an interview with Business Insider.
Urbahn had recently started an internship in business and product development at Social Rank, a social-media-management site based in New York, and was earning a lean stipend of $500 a month. During the summer of 2017, he commuted to the city several times a week from Connecticut, where he lives at home with his parents.
“I have the luxury of being able to live at home with my family,” Urbahn said. “A lot of kids are in debt in college, and it’s a little bit easier for me because I’m in a state school and I have cheaper tuition.”
With no immediate need for his paycheck, Urbahn turned his eye toward investing.
Urbahn had first heard about cryptocurrencies in reference to the notorious drug-trade site Silk Road, which facilitated online drug deals through anonymous bitcoin transactions until it was shut down in 2013. Urbahn says that this association with illicit trade initially made him cautious.
“I associated cryptocurrencies with illegal activities, so I didn’t really want to get involved in it,” he said.
‘I took a huge risk, and it could have easily been a mistake’
But at Social Rank’s office in midtown Manhattan, he learned from the company’s cofounder, Michael Schonfeld, about the cryptocurrency ether – often referred to as Ethereum, after the blockchain powering the currency – and was intrigued by its rising popularity.
“I saw Ethereum as an opportunity,” Urbahn said. “I could either put my money in a bank account with minimal interest, or I could take a risk and put my money into Ethereum.”
By the end of the summer, Urbahn opened an account on the cryptocurrency-exchange site Coinbase and invested $2,100 – almost the entirety of his summer earnings – in ether.
“People can say that this wasn’t a wise decision, and I totally understand that,” Urbahn said. “Anyone that hears of someone putting 80% of their paycheck towards something might say that it’s gambling or that it’s stupid. I took a huge risk, and it could have easily been a mistake.”
So far, Urbahn’s gamble has paid off. When he invested in ether, it was worth about $150 a coin; as of Monday, the cryptocurrency was worth more than 10 times as much. At its peak, Urbahn’s initial investment had grown by $28,000, only to plunge by 50% shortly afterward – a predictable outcome in the turbulent cryptocurrency market.
But despite the currency’s sudden decline, Urbahn has seen huge gains from his investment. Now he owns close to $13,000 in cryptocurrencies and says he doesn’t intend to withdraw his dividends for at least the next two years.
“I look at it as a long-term investment,” Urbahn said. “I’m not trying to make a quick buck.”
Even Dad’s on board now
While Urbahn says it’s nice to see his crypto bet validated with the gains, the real allure in investing in cryptocurrencies is exploring the innovative technology of the coins.
“It’s not really about the money,” Urbahn said. “I really believe that the technology is just interesting, and it’s something I really love. I took a risk in my investment, and it could have easily been a mistake, but I believe that it’s worked out because cryptocurrencies are an incredible technology.”
His investment has changed his father’s opinion as well – Urbahn says he recently signed up for an account on Gemini, the popular coin-exchange site created by the Winklevoss twins, and has plans to invest in ether.