I just bought a $2,000 Bitcoin “call option” from a stranger on Reddit for $300

The trade happened in March when BTC was at $1200. I paid him up front on PayPal. I met him on Reddit. Spoiler alert!!! He paid up $4000 when BTC hit $6000 (then BTC went to $16,000). The $4,000 is going to startups willing to test a hypothesis.

Bubble or world changing reinvention of commerce?

Am I crazy? And if I am, which part is crazier,

• the terms (the fact that I paid $300 for the right to buy one coin at $2000 in a year when it was worth half that)
• the trust (the counter party =random guy on Reddit that I never talked to).

Here’s the story. April 2017

Bitcoin is at 1200usd. I think BTC is going up. I think it has the potential to go up significantly. I have a coinbase account that I am reasonably happy with, but for various reasons related to BTC itself and specific to coinbase, I found it difficult to “trade a position”. I also wanted a bit of leverage, nothing crazy but I wanted to risk all of the capital for a 5x return rather than try and make 20%.

I also thought it would be fun to buy a call option for about 10 coins with a strike price of $2,000 in one year. If it goes to $5,000 I make decent money if not my losses are capped.

I went on Reddit and agreed with someone to do something small scale. I bought one contract for $300 and just paid him upfront.

1. what are the chances that BTC goes to $2600, one year from today — allowing me to double my money in a year?
2. if it goes above $2000 what are the chances of this guy paying me if it does or delivering the one coin?
3. should I do it for 10 coins? $3,000 risk?

The saga…

The profits (if BTC remains at these levels or higher) of this trade will go directly to startups who are willing to test a hypothesis. As long as the counter party pays, and I think he will:) (I forgot when I wrote this but I was about $2,000 in the money)

April 26 UPDATE: I am looking to buy call options on ETHEREUM at a strike price of $100 and a date of June 1st / any takers? This post (indirectly) sponsored by Coinbase — I am not suggesting you put your life savings in Bitcoin or ethereum, but if you do want to get some buy it here.

June 26 UPDATE: I really wish I didn’t fall short at the April 26 update! The fund for startups would have been launched by now! Now looking to buy $1,000 strike price call options on etherum. Read below for my Bitcoin call option story:)

Sept 5th UPDATE: I am using the $2,000 (paper) profit from this trade to buy October 1st ethereum call options in 10 option lots. If you have 10 ethereum coins comment below if you want to make $250 selling $500 strike price October options.

Oct 5th UPDATE: I finally found someone to sell me EOY $500 strike price ethereum options, but I want to buy more.

Oct 30th update he delivered $4,000 and now that money is in a whaleclub account 5–1 ethereum trade at 300.

Dec 5th Update, whaleclub is a scam and they stole $20,000. Should have waited on the option! — Still using coinbase though, and giving money to founders.