It’s quite likely that Otoh has lost more bitcoin than most people will ever hold. An early bitcoin investor, Otoh, a pseudonym that stands for “on the other hand,” has many lessons to share about finding opportunities and making one’s own luck.

Otoh is a speaker at this year’s Consensus festival, in Austin, Texas, May 29-31.

Scheduled to speak on stage at Consensus 2024, in Austin, Texas, alongside crypto luminaries like Litecoin creator Charlie Lee and BTCC and Ballet founder Bobby Lee, Otoh is known among the early crypto crowd for his massive holdings of physical bitcoins – a.k.a. Casascius coins.

“I've never sold any. I’ve just been accumulating them as my version of a cold storage,” Otoh told CoinDesk in an interview, discussing his recent auction of over 200 worth of physical bitcoins in what was the Heritage auction firm’s first crypto sale.

Casascius coins, created by Mike Caldwell (who went by Casascius, an acronym for “call a spade a spade,” on Bitcoin forums), were a solution to spending bitcoin in face-to-face transactions by embedding a Bitcoin private key in a metal coin.

The last ones were made in 2013 after the Financial Crimes Enforcement Network told Caldwell that he was operating an unlicensed money transmitter business. There are only about 90,000 Casascius coins in circulation, of varying denominations, though other manufacturers including Bobby Lee created their own versions.

A part of Bitcoin lore and its physical history, Casascius coins are now sought after by collectors (some are so valuable that they have to be declared to U.S. Customs when entering the country). In some sense, these coins are the most long lived and recognizable image of the purely a digital currency.

“It seemed the right time to let some of the physical coins go,” Otoh said. “Let other people look after them and enjoy having them.”

Of course, part of the danger of bringing bitcoin into the physical realm is that it makes the assets as easy to steal as a $20 note from mom’s purse – and unfortunately, Otoh thinks he was the victim of a theft about a decade ago. He recounted a story of receiving a shipment of coins where the box had been obviously tampered with.

The 55 BTC missing from his collection were worth about $20,000 at the time they were purchased, and are now worth about $3.5 million, “which is a huge sum in most anyone's book,” he said. “I'm very happy to offer a half a million dollar reward for their return. And unconditionally, I wouldn't want to press charges if someone decided to give them back to me,” he added.

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CoinDesk caught up with Otoh ahead of Consensus to discuss his recent auction of vintage physical bitcoins, early investments in other cryptocurrencies like Ethereum’s initial coin offering and how he manages his wealth by diversifying into properties around the world and residing in a tax haven in the British Channel Islands.

Could you give a sense of what you’re talking about at Consensus?

I’m on the panel about physical bitcoins. I'm basically a fill-in for Mike Caldwell, who invented Casascius coins, who couldn't make it unfortunately.

Oh, that's so cool.

Would be nice to meet him one day. Bobby Lee and Charlie Lee asked if I'd be a substitute for the gap on the panel because I am a large investor.

Do you remember buying your first coin?

Yes, very much. It was at the London Bitcoin Conference in 2012. I had just started on bitcoin in the summer of 2011, around July. I remember at the time I met with some German guys – there were all these privacy advocates wearing masks who had a whole bunch of physical coins to sell. I believe it was 10 regular bitcoins and a 10 bitcoin unit piece. The price at the time, with the premium and everything, was $12 a bitcoin.

What does Otoh stand for?

It’s an acronym for “on the other hand.” That's how it's usually used. I just adopted it because I find myself, a lot of the time, not necessarily being argumentative but looking at different viewpoints. I thought bitcoin and crypto is also a different way of looking at finance. Nearly everyone had a nickname on the BitcoinTalk forum. That's the way that came about, but I didn't give it much thought at the time. It was just the first thing that came into my head.

Are there any particular memories of the early days of Bitcoin that you remember fondly?

Fondly? Yes, that must be getting my first coin – that was a big deal. At the time people were still giving away free coins. By the time I joined, word had spread, and it often wasn't a full coin anymore, just a fraction of a coin, but it was still fun to have my own address and then be sent this little token amount of coins to see how it could function.

At the time I was traveling between Europe and the States quite a bit and also buying and selling in Europe and the States. With bitcoin, it suddenly became really easy to send money.

A few of the other memories are more traumatic. It's very easy to mess up. As you learn as you go.

You've probably lost more bitcoins than most people have today.

If you count the ones that were stolen off me. Like that list I just gave you that I put together from nine years ago. Somewhere out there there is a lost, stolen treasure of a few million dollars.

What do you suspect happened there? A rogue employee?

I think it is most likely a rogue U.S. Postal Service employee who just used a box cutter and saw something that looked promising. He probably thought it was Gold Eagles or Silver Eagles or something. I don't know what the reaction would be, whether they were disgusted to see it was just some weird tokens and threw them away or whether they thought “Oh, this looks cool.”

I’ve always hoped that I’d have a brainstorm and remember if I’ve stashed them away somewhere. But it doesn't make any sense – I've got everything else very well looked after and itemized. A friend of mine whose house I had been staying in at that time remembers receiving a box that was cut open and resealed.

Is there anything that you want to say about the OTOH Collection of Physical Cryptocurrency?

Well, after a decade, I decided it's time to sell. I've never sold any, I’ve just been accumulating them as my version of a cold storage. Now that I've sold all my digital crypto, it seemed the right time to let some of the physical coins go. Let other people look after them and enjoy having them.

You're also a real estate investor. At this point, do you think it’s better for people to invest in bitcoin or physical property?

I think it’s a mixture of the two. Bitcoin is high-risk, but potentially it has very high returns. And property is a hedge. It's a safety net. It's also very hard to steal, whereas bitcoins can be very easy to steal.

If I was still in my 20s, then I'd probably be keeping a much higher percentage in crypto, but nowadays I like the security of having a bunch of properties and enjoy renovating them.

Are you interested in other digital assets?

In the past I pretty much have been. I was the largest holder of litecoin {{LTC}} when it was a few cents. I think I had roughly 600,000. It was the first altcoin, and was quite controversial with Bitcoin Maximalists. They disliked it intensely because they thought it withdrew funds and interest away from Bitcoin. But I was quite convinced from the first time I saw it, it's impossible for anything to exist without its opposite.

And so that paid out very well. After Litecoin, I moved into Dash and was the largest holder of those and helped develop the project in some ways. And then I kind of lost interest and moved onto other things. I was highly recommended Ethereum at a Dutch conference and participated in the ICO. I got 100 bitcoins worth, which was about 10,000 Ethereum. Unfortunately, I sold those way too soon. I made 100% or 200% profit, but I sold them for something like $2. So I will rue the potential $800 million there. Otherwise I'm pretty much fully bitcoin nowadays.

The way you discussed bitcoin earlier in the conversation you discussed it mostly as a method of transaction. Are you convinced by the arguments that it has properties like gold?

I think it is excellent as an investment. I think that's its main use at the moment. It’s perhaps the best performing investment in history, and it continues to grow. It is a trillion dollar asset class, and a great way to store value. Satoshi viewed it in the beginning as a hedge against the degenerate behavior of central governments and banks abusing the currencies that we will have to use every day. It's much more versatile than gold, in that it can be transferred pretty much anywhere around the world from anyone to anyone, instantly, with no armored trucks or anything and next to no fees. It's quite miraculous really, that it's come into existence. It's still very early days, but it really has transformed the world in many many ways.

What have been your biggest purchases made with crypto?

I must admit I've done very little with buying and selling with crypto. I go from fiat currency into crypto and then back out to fiat currency.

Capital gains taxes make spending crypto sort of annoying, to some extent.

For many people it would, yes. I'm fortunate that I am based in a tax haven where there isn't any capital gains tax. I make sure that I'm physically there when I cash any out. So I don't have that issue. There's also no income tax.

You mentioned you have a home in California. How do you balance the tax situation there, where state tax authorities may want to charge you income tax?

I’ve got homes in many countries around the world; it doesn't mean I'm suddenly a tax resident. I make sure I count my days very carefully – I don’t overstay. As long as I'm not here for more than six months of the year, I won't be liable for any tax. And I don't do any business here.

Do you mind if I ask what tax haven?

It’s a little island in the British Channel Islands called Sark. It’s a three square mile island and fairly unique in the world for having next to no tax. You just pay a small proportion of your property tax as a contribution to the kind of upkeep of the island. The main thing about it that's attractive is you don't have to keep records of what you're doing, which would have been hugely complicated when I was converting altcoins into bitcoin and then into other alternative currencies and then back into dollars. I do not pity the people who had to try and keep these records and then present them to a tax authority.

Did you give up your passport?

No, I still keep a U.K. passport. I could trade it in for a Guernsey passport, which is the main island in the channel. It's really just a clone of the U.K.. It has all the same benefits, but I haven't bothered to do it. It doesn't really matter what nationality I have. It really only matters where I'm a fiscal resident.

How would you describe your political views?

Well, like many people, with age I probably have become a little more conservative in some ways. But I'm pretty much a capitalist; I believe that's a good way for people to behave. I'm not overtly political. I was probably quite anarchist in the past. I just adapt to whatever the majority believes. I am not trying to change things myself in a big way – I’m pretty apolitical.

Is there anything more you want to say about the possible theft of those Casascius coins?

I believe it was 55 bitcoins in value, something like $3.5 million at present value. At the time they were lost or taken they were only worth about $13,000. Still a lot but nothing compared to right now. So I'm very happy to offer a half a million dollar reward for their return. And unconditionally, I wouldn't want to press charges if someone decided to give them back to me.

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One day, I expect they'll turn up unless they've gone on a destructive route somehow. Everyone can see the addresses; I was really surprised when I checked a couple of weeks ago that they had never been moved and that they hadn't been peeled. So they're probably out there somewhere.

Last question, what are you looking forward to at Consensus?

Well, meeting Bobby Lee and Charlie Lee again. They both in their own ways have been very instrumental in helping me with my crypto journey. Charlie Lee by inventing Litecoin, where I did extremely well – probably even better than I did with bitcoin. And Bobby Lee for having BTCC (also known as BTCChina) and the physical coins. He produced physical coins just like Mike's Casascius coins. I have still got all my BTCC coins. That will be a future auction.

I've had quite a few adventures with the physical coins. I had to physically go to Shanghai to pick them up, as they couldn't be shipped at the time. That was an adventure in itself.

There's other people that I know from forums and interacting with on the internet who I'm sure it would be nice to see again in person if I've met them at other conferences. It's a chance to put people together and exchange ideas that if one just sat behind a computer at home, perhaps wouldn't happen.

So I'm looking forward to it. It's quite exciting. It's my first visit to Texas.