Crypto Trader Apologizes for 1,200% Gains

In the highest echelons of the cryptocurrency investor world, extreme riches are a common feature. The cryptocurrency Consensus conference in New York City earlier this year hosted a fleet of Lamborghinis and other luxury cars, for instance, and those who have been most successful in the digital currency space are also known for living lavishly in other areas of life, too. However, with the quick rise to prominence of a new group of cryptocurrency millionaires, not all investors have reacted to their newfound wealth in the same way. According to Business Insider, some of these cryptocurrency elite are even somewhat ashamed of their ridiculous gains. One trader went so far as to apologize to a hedge fund lawyer for his gains.

$600,000 to $8 Million

Cryptocurrency hedge fund lawyer John Lore has ample experience interacting with top cryptocurrency investors. He explains that "some of them make me feel bad about my own net worth and what I've done with my life," but on the other hand, Lore says he "even had a fund manager apologize for making so much money and said he'd donate a lot to charity." This particular manager had invested about $600,000 initially and that the rise in the cryptocurrency market had left them with about $8 million. Lore explained that "my son took one look at that and decided he's going to be a cryptocurrency manager."

Lore, the founder of Capital Fund Law Group, a New York-based company specializing in advising hedge funds and asset managers, has said that the get-rich-quick stories of these cryptocurrency leaders have inspired many investors to join the space. "There's a lot of demand but I think right now there's a lot of need for education," he explains. "Never has there been a more diverse group of potential managers coming to us. These aren't just all former buy-side analysts at investment banks, they're coming from all different aspects."

Easy to Forget Risks

Seeing stories like the one above, it's easy for even seasoned asset managers to forget the extreme risks associated with the cryptocurrency space. Lore's words of caution for would-be cryptocurrency investors and hedge fund managers ring true across the industry. It's important to remember that the cryptocurrency millionaires are likely the extreme exception, rather than the rule.

Investing in cryptocurrencies and Initial Coin Offerings ("ICOs") is highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or ICOs. Since each individual's situation is unique, a qualified professional should always be consulted before making any financial decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein. As of the date this article was written, the author owns bitcoin and ripple.

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