The Aussie describes the huge windfall as “mind blowing” and has even used the investment strategy to boost her superannuation.
When Theresa Vu decided to “dip her toes” into the crypto market with $10,000 she never expected the “crazy ride” would have scored her $400,000 in just seven months.
The Sydney resident said she started off slow, investing small amounts back in March, while educating herself on crypto and the blockchain technology behind it.
“The interest rates for cash is quite pathetic for the last year or two … and I stumbled across crypto and started reducing my share portfolio and selling it and moving it to crypto and parking it there to get a much better yield,” she told news.com.au. “It’s mind blowing.”
She has invested in a range of crypto from ethereum, solana, and luna, as well as exploring new entrants like fantom.
The 47-year-old said educating herself about crypto has been like going down a “rabbithole”.
“There is not much information out there. It’s not like CommSec where you open an account and all the publicly listed companies are on there,” she explained.
“With crypto exchanges, none of them have all coins so you have to open different accounts with different coins. I had to start it over time and through research I was able to do it, but it wasn’t easy for someone who is new to be honest.”
No regrets
Ms Vu predicts that crypto is going to be huge in the next five to 10 years and will grow “exponentially” as awareness spreads and there is more adoption.
She acknowledges there is a risk with investing in crypto, but said that is the same for all financial products.
“Through what I have been through in the last seven months I have educated myself enough to choose the right products,” she said.
“For instance a lot of these crypto coins are very speculative, some of them don’t even have a working product, it’s just in development so I try and stay clear from that. I choose the blue chip ones, so the top 30 that has a working product and it’s got a lot of applications that people will be using.”
The UK financial regulator has warned that people should be prepared to lose all their money if investing in crypto.
But Ms Vu is so confident about it she has also used some of her super money to invest in crypto.
She is one of the million Australians who has a self managed super fund, making the leap in 2010 and taking out a combined $150,000 with her partner.
Wanting control over her assets and what they were invested in, she has know grown their super pot to $655,000. Around $105,000 of that is invested in crypto, which is about 15 per cent of the whole super portfolio.
“With the recent run it did really well … most of my investment is in ethereum, which has given a 30 per cent return, but not only that you earn passive income,” she said.
“So 30 per cent is actual capital growth and then you have interest on that which is 4 per cent.”
She is also snapping up collectable art via NFTs for her super.
Self managed super funds
At the end of June, there were nearly 600,000 self managed super funds (SMSF) in Australia with a combined total of 1.1 million members, according to the Australian Taxation Office.
Although this represents less than 5 per cent of Australia’s population, they accounted for $822 billion in assets or about 25 per cent of the $3.3 trillion invested in superannuation.
Roughly 20,000 SMSFs were sitting on a staggering amount savings of at least $5 million in June 2020, up from about 14,800 five years ago.
Crypto exchange Independent Reserve currently provides services to thousands of SMSF customers. SMSF crypto volume traded in 2021 to date is $557 million for Independent Reserve, up from $122 million last year and $77 million in 2019.
A new survey this month revealed that 38 per cent of Australian SMSF trustees are either likely or very likely to invest in cryptocurrencies.
While the stereotype associated with SMSFs is that of wealthy Baby Boomers, statistics from the Australian Taxation Office show that people under 40 are the fastest-growing segment, said Independent Reserve.
Around one in five SMSFs are run by Australians under the age of 45.
Independent Reserve CEO, Adrian Przelozny, said self managed super investors reap the rewards of tapping into digital currency investment to diversify their portfolio and support their investment goals.
“In fact, one of our first SMSF customer’s $40,000 investment into bitcoin is now worth approximately $3.3 million,” he revealed.
“Our SMSF customers have more than doubled over the past two years and we expect this growth to continue. As the sector grows, we’d also like to see the Australian regulatory landscape continue to evolve to support SMSF investment in crypto to enable security and protection for investors.”