To HODL or not to HODL: A crypto-millionaire’s story

Matt Levin Dec 7, 2021
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Some crypto-enthusiasts follow the mantra of HODL, or "hold on for dear life," to weather the volatility of their assets. Chris McGrath via Getty Images

To HODL or not to HODL: A crypto-millionaire’s story

Matt Levin Dec 7, 2021
Heard on:
Some crypto-enthusiasts follow the mantra of HODL, or "hold on for dear life," to weather the volatility of their assets. Chris McGrath via Getty Images
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Glauber Contessoto and his aunt, Cristiane Pereira, are probably fine talking religion or politics this Christmas; they’re close. But there’s one topic they may want to avoid, at least before having too much eggnog: cryptocurrency. 

“If you had what I had in dogecoin right now, you would spend it,” Contessoto told Pereira on Zoom. He’s based in Los Angeles, while she’s in Maryland.

“Oh for sure. Of course,” said Pereira. “I want to live, you know?”

In February, 34-year-old Contessoto invested his life savings in dogecoin, a cryptocurrency that started as a joke. The punchline? He now has more than $800,000 in doge and has barely cashed out any of it, though he reinvested some into other cryptocurrencies.

Aunt Cristiane is a housekeeper with about $15,000 in savings in conventional U.S. currency. She and her husband, who works as an Amazon delivery driver, raise two children on about $50,000 a year.

Pereira and some other family members think Contessoto should have sold months ago.

“Of course they ask me to cash out everything ’cause we’ve never had this much money ever,” Contessoto said. “My reasoning is, they also told me I was stupid to buy dogecoin when I bought it.”

At one point, the “stupid guy” saw more than a 1,000% return on his investment. He’s now the most famous dogecoin investor not named Elon Musk. He’s got a YouTube channel and copyrighted the term “Dogecoin millionaire.” He sees his crypto holdings as a springboard to bigger things.

So, on the bad days when the incredibly volatile dogecoin loses half its value, Contessoto just keeps calm and HODLs. That’s crypto-speak for “hold on for dear life,” although there’s no consensus on how you should pronounce it.

“This is, like, one of those GIF and JIF type of things,” said Finn Brunton, a professor of technology studies at the University of California, Davis.

HODL originated eight years ago as a typo on a message board — somebody meant to write “hold.” Crypto-enthusiasts ran with it and retroactively coined the “hold on for dear life” acronym.

Back then, HODLers were mostly Federal Reserve-hating libertarians who thought bitcoin would replace a doomed dollar. But with crypto more mainstream now, you don’t need Ayn Rand in your profile pic to be a HODLer.

“Basically you’ve got the classic, what economists call the Tinker Bell effect,” Brunton said. “We all need to keep believing or else this will die.”

HODLing has cost Contessoto. When dogecoin hit its peak in May, he had well over $2 million worth — more than twice what he has now.

And it wasn’t just his money at stake. Aunt Cristiane loaned Contessoto $1,500 for a small part of his initial investment. That was worth more than $7,000 at the time I interviewed them together.

“That’s some nice money,” Pereira said.

“Here’s the thing, though. At its peak, it was a lot more,” Contessoto said. More than $20,000.

Contessoto didn’t say this to be mean to his aunt. He believes doge will rise again.

“We actually have made a deal with the whole thing. I told her, ‘Give me the $1,500, and I’ll buy you a house,'” Contessoto said.

Pereira is less concerned with her share than with Contessoto enjoying his earnings before a possible crash. She wants him to move out of his studio apartment and get a nice haircut.

Contessoto isn’t a forever HODLer. He’ll take much less of a tax hit if he waits until next year to sell, based on capital gains rules. After that, he said, he’ll reevaluate his holdings.

Which means Christmas at the townhouse Pereira rents will be very similar to years past. “A few more Five Below gifts,” Contessoto said, laughing. “I can probably swing that.”

Five Below is a store where everything costs less than $5. It’s not accepting dogecoin. At least not yet.

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