Investing & Money
piece written on the 8th December 2013 by  

Let me warn you, this is going to be a bit of a rant and if you’re not in the mood for one rather scroll down a little to where I want to offer some tips.

Whilst the rest of the world made an absolute killing on Bitcoin yesterday thanks to China, most of us South Africans sat and watched with envy. See, China went ahead and does what China often does .. moaned about something Internet related. This time it was about Bitcoin and guess what happened? The price of Bitcoin plunged from $1200 odd down to around $560 over night. Of course, the price drop was caused through the fear of the general public, but those who do a bit of trading on any form of stock market will know that this is often a really good time to quickly snap up stock and that’s exactly what we should have been doing. I’ve learnt a fair bit about trading and one thing I try to do is predict what the general uninformed public will do and try to trade in and around them to my benefit. Anyway, China isn’t the be all and end all, what they say isn’t the last word and with the US releasing various statements about Bitcoin being a major player for eCommerce (amongst plenty of other things) is was blindingly obvious that the price would rise again as the dust settled.

So, based on the reading I’ve done and my understanding of Bitcoin and various market places I figured the price would move up from $560 to around half way between $560 and $1200 fairly quickly.


When a stock is so volatile and large corporations are publishing all sorts of speculative information, the price is going to rise and fall a few times – in the case of Bitcoin, because it’s unregulated, there’s more chance of this rather than a stock which could do a huge drop and not recover so quickly. Being fast to get in and out is how you can make a tidy profit. Of course, the adverse could apply. Multiple opportunities in a single day to buy and sell. This is why I’m annoyed..

I’m verified on Luno (a South African Bitcoin exchange) and quickly decided to purchase a decent number of Bitcoins only to realise:

  • You have to top up your account, but because we’re in South Africa an EFT required about 3 days for clearance. 3 DAYS FOR CLEARANCE on a volatile exchange? Bye bye boat.

I sat at my computer arms in the air and watched Bitcoin go from $560 to $720 – that’s a $160 increase per Bitcoin – If you had invested R100,000 and cashed out 3 hours later your return would be worked out roughly as follows:

  1. R100,000 = 17.25 Bitcoins (R5,796.84 per coin)
  2. Price went from R5,796.84 per coin to R7,453.08 (R1,656.24 increase per coin)
  3. Profit = R28,570.14 LESS 0.1% commission LESS R8.50 x 2 for push and pull of funds

GRAND PROFIT: R25,696.13 (taxes excluded).

That’s an hourly rate of R8,565.38 for doing a simple buy on the drop and sell on the rise. (Hope my math is all correct).

Imagine you had access to more money, think of the return on a million rand!

I cannot begin to explain how upset I was about this. I’ve worked in affiliate marketing for going on 15 years and we’re always stuck with this local hinderance when it comes to moving money around in South Africa. This isn’t anything new, don’t get me wrong, I mean, just look at PayPal in South Africa.

So, here are some tips:

  1. If you want to trade Bitcoin locally, make sure your Fund on Luno is topped up with cash. It’ll only cost you R8,50 to put money into your account if I’m not mistaken.
  2. Find a friend who isn’t based in South Africa who could handle the trade for you.
  3. Mt.Gox is the biggest and safest International exchange platform and they do cater for South Africans, but you’ll have to wait at least 10 business days whilst they verify your credentials as their systems are heavily loaded. You’ll also be passing money through forex, so check how your bank’s online system handles this too.

Note: For Luno, you’ll have to have a verified account which requires FICA clearance, so that’s the first hurdle – it’s free, get it done. Also, once you’ve deposited money into your account and purchased Bitcoin, don’t forget to request a disbursement of the Bitcoin to your wallet (I made this mistake and sat stressed out all day due to my wallet not getting credited)!

A great opportunity missed.

Based on the limited number of coins, the interesting take from US authorities, the coin volume movement and the individual large investors I believe that the value will surpass the all time high we experienced last week of $1,200. I don’t think it’ll happen immediately or even quickly though. I do believe we’re in for big changes though and I’d be very careful trading bitcoin without being incredibly tuned in – it’ll take authorities a long time before they can really influence it too much or attempt to regulate it, but it will happen and we need to have withdrawn before then and that’s going to be hard to predict.

Bitcoin is interesting, it’s very possible to make some great returns, but this in my opinion isn’t a long term solution and I’d say you’d do better reading my post on where to invest your money if you’re serious about investing in a more stable and long-term approach. That being said, it looks like the JSE isn’t going to perform too well over the next 3 years according to Bloomberg.

Interesting times ahead, tough enough already let alone being hindered the whole time by authorities.

BDLive published an easy-to-read article called Bitcoins virtually as good as in the bank, which is worth a read if you’re not too familiar with Bitcoin and would like to hear it from a credible source.

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  • basheer

    Great post. My personal philosophy is to never invest in something I dont understand. Yes the potential is there to make good returns but I dont understand it and it falls outside my circle of confidence. If you do decide to invest it would be interesting to see your results. :)

  • naeem

    so ya, i have bitcoin-envy – lol if i put 10k last year, i could have retired this year ;)

    anyway, signing up with – well aware of the 10day waiting period for new accounts. lets see how this goes.

    Have you read up on Litecoin?

  • I think your philosophy is a very wise one, and one which people should follow. Bitcoin is definitely a high risk “investment” strategy, one that can bring huge returns, but you have to “play” it like you’d play cards at the casino.

  • Exactly! FOMO! ;)

    I’ve applied at MTGOX and submitted my documents so I’m also waiting to hear back, hopefully it won’t take them too long to verify us.

    Litecoin, indeed – it’s an interesting one to follow, way lower buy in costs and it looks like it has potential, could be the next boomer – get in now, watch them hit $500 ;)

    You’ve probably seen it, but this is a great site:

  • naeem

    yup, kinda sidelined without adsl since thursday. Telkom, bless them… Using 3g bundles…not ideal, not cost effective and crappy speeds.

    Cant really go wrong with a few k in litecoins

  • Ouch! I remember last year we had outage for a few days so I turned to 3G and I’ll never forget the Vodacom bill I got -_-

    I need more time in the day though ;)

  • Tho I agree with this statement (investing in something you dont understand) Bitcoin is actually a simple concept if you just take some time to read it over. The whitepaper is only 8 pages long Outside of that I recommend you spend some time on you will have most of your questions/confusions taken care of :)

  • @iamruark:disqus I think @disqus_wPFRj5zKT6:disqus is referring more to not understanding from a political/economic stand point in terms of being able to understand the movements of the “currency”, not how it actually works. I could be wrong though, but that’s my interpretation..

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  • rrcatto

    I recommend you buy bitcoins on instead and sell on virwox places limits on new accounts so sign up now and wait 60 days to be able to buy bulk. I won’t touch – too risky.

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  • Haroun Kola

    You can also trade the bitcoin market on an exchange like or Both are leveraged trading platforms so you can make or lose money faster than the 1-1 exchanges. Look into They have a passive income opportunity for the bitcoin community.

    Get in touch with me if you’d like to sign up under me, they also have an affiliate program, and I’d really appreciate it :)

  • Thanks for sharing the resources @haroun_kola:disqus, I use BitX and am happy with their service but I always like making comparisons so I’ll have a look at bitfinex when I have a gap.

  • Haroun Kola

    I think 2014 is going to be the year for bitcoin related CFD products entering the market. Exciting times for those who know how to read a price chart.

  • Hi Chris – A lot has changed with Bitcoin since this article was written, what is your current take on the possibilities of running this in South Africa now? There are 2 exchanges, however BitX still appears to be the more mentioned. Takealot and Payfast now offering Bitcoin to spend. New places like BitClubNetwork site found to assist folk. With cryptocurrency possibly being the future for Africa, moving money a lot easier and at lower charges. An update to this article would be a pleasure….

  • Hi Joan – I must admit, I’ve been out of the loop a bit with Bitcoin. I do follow along a bit, but not too much is happening that is worth reporting on. I know some of the biggest names in industry are giving talks and there is some news about Wallstreet showing interest, but I think it’s still a bit of time before someone really evolutionary happens so I’ve decided to hold off until that happens. Truthfully, I’ve been so caught up with work that my radar has been a little weak as well :)

  • Thanks for quick reply, I really just started looking into this. A lot of MLM building going on in club but it offers assistance with growth… All in USA. Ice3x appears as a second exchange option here, again EFT to them to transfer funds, timing! Cryptocurrency really will be a huge leap for SA but not if Reserve Bank gets involved; With PayPal USD earning and FNB – move your money in 30 days or else.. Would love to know how entrepreneurs grow with all the red tape!

  • Logan Young

    Hi Chris – I’ve just recently invested in bitcoin. I don’t have a lot of money so I put in a small amount roughly 12 days ago. I bank with FNB so clearance of money into my bank account happened overnight and I got out exactly what I was expecting I would.

    Since then, my investment has basically grown by ~R95 (R500 initial investment and I’ve disbursed R20 as a test to make sure I understand how the process works). It’s not the quick money like I was expecting, but then I bought a really tiny investment (less than 0.1 BTC).

    Still, I’m happy with how its been going and I watch it every day. If it drops to within R520 value, then I’ll withdraw it all I think… Then buy low when I see it start making significant increases again.

  • @Logan – Welcome to the world of BTC! I must admit, I’ve been very slack in this regard and haven’t followed BTC much at all over the past few months. However, since all the local currency madness I did have a look at my BTC account and saw that the value had gone up since I bought. It’s trading at R6889.84 currently and I think I was lucky enough to buy several at around the R3,000 mark if I remember correctly. I can’t believe how how little people are talking about BTC though, it was all the hype and then went really quite. I think the biggest thing about BTC is that it’s highly unpredictable (well, at least mostly) so you need to be careful about how much you invest and whether it’s wise to invest in BTC or something more stable locally.

  • johny billionaire

    well most people in the MMM community uses bitcoin.


    bitcoin is the future

  • Is that the MMM that crashed and burned last week with the Russian owner? Apr 12, 2016 – Cape Town – Sergey Mavrodi’s Bitcoin-based MMM Global Republic of Bitcoin scheme has collapsed, affecting the local branch of MMM Global.

  • Throw caution to the wind especially with cloud based mining, is the general feel. I have written quite a few articles relating to South Africa setting up Bitcoin on my blog

    IMHO blockchain technology has a strong future in FinTech. The future of Bitcoin and/or Ethereum is exciting and great to test and learn about it now. Throw caution to the wind, it can crash and burn, be careful with the Litecoins, too many flooding the market and only a few will gain traction.

    I have noticed most offering to grow in a Membership site are using MLM type growth, I am in one using Bitcoin and one using Ethereum, it is a roller coaster ride, but then so is fiat currency. Play nicely and play carefully no matter what you do.

  • johny billionaire

    Yip. The experiment crashed after a year. All the people that was part of mmm global are now joined by their local community.

    The reason it crashed was 100% interest on your investment. So they are back at the local of 30% interest

    Read more about it at

  • johny billionaire


  • Precious McPresh Ezeabasili

    I figure out a way to invest all my Bitcoins…


    Follow this link to join the MMM.EXPRESS WhatsApp group:

  • Prince Radebe

    Hi Chris

    I just started an interest in Bitcoins have already topped up my wallet with Luno. What is your take with the current state of Bitcoin?

  • It’s-a-fact

    “Mt.Gox is the biggest and safest International exchange platform”
    So now we know that our coins are not safe with anyone. also got cleaned out recently.

  • Nelisiwe Mshengu

    Hi Chris….I only started with Luno on yesterday and deposited just R200.00 to test it and did an instant buy on bitcoins which gave me 0.00228566 in bitcoins but believe me I hardly understand whats happening but I have just noticed that on the zar I had ~ZAR195 on yesterday and I have ~ZAR200.00 as I text. is this the fluctuation of the bitcoins growing in Rands though?

  • @nelisiwemshengu:disqus Thank you for your comment. Please do some reading on Bitcoin and read any tutorials you can find, it’s dangerous to invest without a good understanding as you could easily lose your money!

    It’s hard for me to help because I don’t know exactly what your account looks like, but if you deposited R200 and bought R200 worth of Bitcoin, you shouldn’t have any cash balance, rather just a Bitcoin balance. However, what you might be seeing is what your cash balance WOULD BE if you sold the Bitcoin, that’s why it would be fluctuating.

    Does that make sense? Luno’s support is quite good, if you’re concerned please contact them, don’t just assume anything!

  • Nelisiwe Mshengu

    Thanks alot Chris… makes alot of sense..I have’t sold the bitcoin. just storing it….don’t even know if that’s a good idea. I’m planning to store it for the next year maybe

  • Good luck!

  • I’ve only seen your comment now! Sorry about that. I guess you can answer your own question now *wink*

  • Prince Radebe

    Thanks Christopher. It’s been a joyful ride.

  • Great!

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  • Jen Smith

    I have deposited R500 ZAR into Luno account. Any guidelines on what site/stock I start to buy? VERY new to this concept, BUT very curious. Thanks.

  • Well, Luno offer BTC and ETH, so those are your options. I’d recommend joing this group on Facebook and asking:

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