A 21-year-old college student invested 80% of his summer paycheck in cryptocurrencies and made an enormous profit

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 Ethereum 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 midtown Manhattan office, he learned about the cryptocurrency Ethereum from the company's founder, Alex Taub, and was intrigued by the currency's rising popularity.

"I saw Ethereum as an opportunity," said Urbahn. "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 Ethereum.

"People can say that this wasn't a wise decision and I totally understand that," said Urbahn. "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 Ethereum, it was worth about $150 per coin. As of January 29, the cryptocurrency is 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 afterwards — a predictable outcome in the turbulent cryptocurrency market.

But despite the currency's sudden decline, Urbahn has seen huge gains off of 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, he says the real allure in investing in cryptocurrencies is exploring the innovative technology of the coins themselves.

"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 that his father has recently signed up for an account on Gemini, the popular coin-exchange site created by the Winklevoss twins, and has plans to invest in Ethereum.

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