A teenager from a family he describes as the "Elon Musk version of the Kardashians" has become a millionaire after investing $1,000 (£800) into bitcoin when he was just 12 years old.

Thanks to a tip-off from his brother, Erik Finman, from Idaho, US, invested a $1,000 gift from his grandmother into the cryptocurrency in May 2011. At the time, bitcoin was unheard of outside of technology communities and worth around $12 per coin.

Finman told CNBC how he invested in bitcoin as a way of winning a bet with his Ph.D-holding, Stanford-educated parents, who said he did not have to go to university if he became a millionaire by the age of 18.

That first investment quickly grew from $1,000 to $100,000 by the end of 2013. Finman then sold the lot and used the proceeds to move to California's Silicon Valley and set up a company called Botangle, which allowed students frustrated with the quality of their current education to video teachers to video chat with online.

A year later, in January 2015, Finman found a buyer for Botangle who offered either $100,000 in cash or 300 bitcoins, which was worth less, around $60,000, due to the cryptocurrency being valued at a little over $200 per coin. Finman opted for the less valuable option, believing his bitcoins would appreciate massively over the coming years, becoming "the next big thing".

Through further investment Finman now owns 403 bitcoins, worth $1.13m at the time of writing, but the currency's extreme volatility means it could rise or fall significantly in mere hours. Finman also has smaller investments in other digital currencies, including litecoin and ethereum.

While some analysts think bitcoin is already overvalued, others have recently claimed it has the potential to top $100,000 per coin. Finman, perhaps unsurprisingly, is even more bullish: "Personally I think bitcoin is going to be worth a couple hundred thousand to a million dollars a coin."

As for the bet with his parents, Finman still has no plans to go to university. Instead, he believes the internet offers a better education for free. "The way the education system is structured, I wouldn't recommend it. It doesn't work for anyone. I would recommend the internet, which is all free. You can learn a million times more off YouTube and Wikipedia."