For the second episode of Stuff's new podcast series, Superfad, hosts Katie Kenny and Laura Walters talked to Bitcoin speculator Derek Rose, who invested his life savings in cryptocurrency. Here, Rose shares his story in his own words.

I was a bit nervous when my former colleague Katie Kenny asked me if I wanted to tell the story of how I had lost nearly $10 million worth of cryptocurrency. I figured people would listen to the story and say, "Jeez, what an idiot". And honestly, I wouldn't blame you if you think that. It's kinda true: I ignored the advice of my friends, a financial advisor and random people on the internet in making larger and larger bets on Bitcoin and similar instruments, which paid off ... until they didn't, and I lost a small fortune.

All I can really say in my defence is that I'm not asking for anyone's sympathy or pity. I only lost my own money, not anyone else's. And it was just such a rush, turning an investment of around $70,000 into almost $3 million by placing leveraged bets on two cryptocurrencies called EOS and Iota in a few weeks during November and December.

My first moves were smart, involving patience and careful research. But rather than take profits and, say, buy a house, I bought more Bitcoins on the same mysterious website I was using, called Bitfinex. And that bet paid off as well, at first. I bought half a million dollars in Bitcoins when they were less than US$8000, only to see their value rise to over $14,000 in a few short days. So I bought more (and more). And just about every cryptocurrency I could buy on margin on Bitfinex.

At the top of the market in mid-December, my account was worth over US$7m (around NZ$10m) and I had borrowed US$14m (NZ$19m) to buy more cryptocurrencies. I was paying thousands of dollars a day in interest, but for each US$1000 rise in Bitcoin's value, I was making about half a million dollars. And in those heady days, Bitcoin was making $1000 gains every other day.

I was so giddy and high on emotions it was hard to work out, because I was spending all my testosterone and adrenaline checking the balance of my portfolio multiple times each day. It was a hell of a rush.

Looking back at my texts with my friends from that time is, well, interesting.

"If you are right that having 1 BTC [one Bitcoin] is impressive in the future then what you have now is more than enough. So you can sell a bit and hold some cash," one wisely counselled.

"I want to own a sports team though," I replied. "And have a yacht. These things add up quickly." (Yes, I really texted this). I would diversify into real estate, I boasted to my buddies, only once my portfolio reached $100 million.

"If you are right, then half your bet is enough," that same friend countered. "If you are wrong, you are broke."

"It's more exhilarating this way," I said.

And that's what it was really about: The thrill. It was so exhilarating, knowing I was risking huge amounts of money.

I don't really think buying cryptocurrencies is like gambling — it's a valid investment in a groundbreaking technology — but I've got to admit there were some parallels. It's a heady thing, making half a million dollars on paper in a day.

SUPPLIED Derek Rose put his life savings into cryptocurrency, lost big, but is still winning overall, he thinks.

So how did I get started on this wild path? I had bought my first Bitcoins in 2013, when they were worth less than $100. I authorised a website called Coinbase to take $25 out of my US bank account each week, buying a quarter of a Bitcoin for $25. But then when I moved from New York to New Zealand later that year, I needed cash. So I stopped those withdrawals and later sold half of my 10 bitcoins for around $500 to pay off some debts. D'oh!

Around May of last year, when bitcoin topped $2000 and another cryptocurrency called Ethereum hit $400, I decided that while I had made a big mistake, there was still time to rectify it. A wild idea hit me: cash out my entire US retirement account and put it into cryptocurrency. As a journalist, I had never made a lot of money, but I had been very good at saving up to 10 per cent of my salary, starting when I was in my early twenties. Thanks to the magic of compounding, two decades later, I had around US$200,000 saved, mostly invested in bland, safe index funds that mirrored the entire worldwide stock market.

"Why not just go for it?" I thought. Unlike some of my peers, I hadn't bought a house or started a business. Single and in my mid-forties, I was ready to take a risk and shake things up. It was nerve-wracking withdrawing my entire life savings — $3500 each day to avoid hitting Coinbase's $25,000 weekly limit. Of course the market crashed soon after I started my plan, but I stuck with it and it bounced pretty quickly.

Then, right before Christmas, disaster struck (as you can hear me relate to Katie in the attached podcast). But at least I can laugh about it now, right?

I think it makes a pretty good story and I'm not telling it for any other reason than people might get a kick out of it. And really, as a journalist I've asked hundreds of people to tell their stories, it would be hypocritical not to tell mine just because it makes me look foolish.

While I have a lot of regrets, cashing out my entire life savings to invest in cryptocurrency isn't one of them. This was a huge blow, but it didn't wipe me out. Overall, despite my Bitfinex liquidation, I'm still doing better with my investments than I would have if I had stayed in index funds.

This year is off to a terrible start as far as cryptocurrency valuations go, but we're just a few months in. If in the end 2018 ends up being like 2017, I'll have made back my $10 million by mid-year.

This time, I hope, I'll be smarter about it.

Superfad is a seven-part podcast series, brought to you by Skoda. A new episode is released every Friday on iTunes, Stitcher or wherever you normally get your podcasts. Join the Superfad group on Facebook and look out for behind-the-scenes extras in a weekly Facebook Live discussion every Monday.