An early Bitcoin adopter, using the pseudonym "JohnGalt," recently made headlines by unlocking a digital fortune stored for over a decade inside a physical Casascius Bitcoin bar. After 13 years of safeguarding the asset, he successfully accessed the 100 BTC contained within, now valued at over $10 million. However, a simple oversight during the process led to the loss of Bitcoin Cash (BCH) worth approximately $40,000.
The Journey from $500 to $10 Million
Back in 2012, JohnGalt purchased the physical Bitcoin bar for just $500. At the time, a single Bitcoin was valued at around $5, and the cryptocurrency market was in its infancy. Few could have predicted the astronomical rise in value that would follow over the next decade.
In a detailed post on the Bitcointalk forum, JohnGalt explained his long-term attachment to the physical bar, noting that it held sentimental and collectible value beyond its monetary worth. Over the years, he attempted to sell the bar through various channels, including auctions, but challenges around valuation and trust consistently prevented a successful sale.
With Bitcoin’s price recently surpassing $100,000, JohnGalt concluded that holding an eight-figure sum in a single physical object had become too risky. This prompted his decision to finally redeem the digital coins.
How the Bitcoin Was Successfully Redeemed
The process of accessing the 100 BTC required careful handling. Each Casascius bar comes with a tamper-proof hologram sticker that conceals a private key. Once this hologram is peeled back, the key can be used to transfer the Bitcoin to a digital wallet.
JohnGalt shared his step-by-step experience on the forum:
- He began by delicately removing the hologram to reveal the private key.
- Initially, he tried importing the key into an Electrum wallet on an Android device, but the app did not support the "mini private key" format used by Casascius.
- He then used the website bitaddress.org to convert the mini key into a standard private key.
- Finally, he created a new wallet using Trezor Suite and transferred the 100 BTC securely.
The entire transaction was confirmed on the blockchain, making it one of the largest-ever redemptions from a physical Bitcoin coin.
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The Cost of a Small Mistake
Despite the overall success, the redemption process had an unfortunate downside. When JohnGalt shared a photo of the exposed private key on the forum, he unintentionally left himself vulnerable.
Because Bitcoin Cash (BCH) uses the same private key mechanism as Bitcoin (due to the 2016 hard fork), the revealed key also controlled BCH associated with the original Bitcoin address. Within just nine minutes of the photo being posted, an alert individual swept the BCH from the address—worth about $40,000—into their own wallet.
This incident highlights the critical importance of operational security when handling cryptographic keys, especially when dealing with forked assets.
Lessons from a Long-Term Holder
JohnGalt’s experience offers several key takeaways for those interested in physical cryptocurrencies or long-term digital asset storage:
- Physical Risks: Hardware like Casascius coins can be damaged, lost, or degraded over time. Holograms may peel, and private keys can become unreadable.
- Technical Barriers: Redeeming physical crypto assets requires familiarity with key formats, wallet software, and transaction procedures. Not all tools support older or less common key types.
- Security Awareness: Exposing any part of a private key—even in a photo—can lead to immediate loss of funds, especially if related blockchain assets exist.
Despite the loss of BCH, the crypto community widely applauded JohnGalt for his patience and belief in Bitcoin through its most volatile years. His story is a testament to the life-changing potential of early belief in transformative technology.
JohnGalt mentioned that he plans to keep the now-redeemed physical bar as a memento of Bitcoin’s early days and his part in its history.
Frequently Asked Questions
What is a Casascius Bitcoin?
Casascius Bitcoins are physical coins or bars created by Mike Caldwell that contain a certain amount of Bitcoin. Each unit has a tamper-proof hologram that hides the private key needed to redeem the digital value.
How do you redeem a physical Bitcoin?
To redeem a physical Bitcoin, you must carefully remove the hologram or coating to reveal the private key. This key must then be imported into a compatible cryptocurrency wallet that supports the key format. From there, you can transfer the Bitcoin to a more secure software or hardware wallet.
What are the risks of storing Bitcoin physically?
Physical Bitcoins can be lost, stolen, or damaged. Environmental factors like water, fire, or simple wear and tear can destroy the key. There’s also the risk of user error during redemption, such as exposing the private key or sending to a wrong address.
Why did JohnGalt lose his Bitcoin Cash?
When JohnGalt shared a photo of his private key after redeeming his Bitcoin, he didn’t immediately move the forked Bitcoin Cash associated with that same key. Someone else saw the key and transferred the BCH before he could.
Is it safe to buy physical Bitcoin today?
While physical crypto collectibles remain popular, they are generally considered high-risk for storing significant value. Proper understanding of redemption, storage, and security is essential. Most users today prefer dedicated hardware wallets for securing large amounts of cryptocurrency.
Can you still buy Casascius coins?
Mike Caldwell stopped producing Casascius coins in 2013 due to regulatory guidance. They are now considered collector’s items and often sell for significantly more than the Bitcoin value they contain.