The Man Who Lost $36 Billion in Bitcoin: Curious Case of Michael Brown

Bitcoin (BTC), the world’s leading cryptocurrency, hit an all-time high price of $109,114.88 on January 19, 2025.

However, the coin’s value was less than $0.01 per BTC in 2010, about a year after it launched in the digital market. Michael Brown, also known as KnightMB, was one of Bitcoin’s early adopters.

This name has been rather popular among the true crypto OGs, let us take a deeper look into the life of Michael Brown.

He has one of the most compelling BTC stories in the industry.

Bitcoin Price soars, Pushing Brown to Riches

Bitcoin Historian, a prominent user on X, in a post, chronicled some major highlights of Brown, who reportedly owned and lost approximately $36 Billion worth of BTC in an unexpected twist of events.

Notably, Brown, one of the early adopters of Bitcoin, interacted with Satoshi Nakamoto, the pseudonymous creator.

– Advertisement –

The interaction occurred on a forum like a chat room where they discussed the increasing difficulty of Bitcoin’s Proof-of-work.

Bitcoin historians pointed out that the early days of Bitcoin were filled with opportunities. One such opportunity in a post, as described allowed early adopters to mine blocks of 50 BTC on a laptop. As a miner, Brown quickly became the seventh richest person in Bitcoin with 300,000 BTC.

When Brown owned this amount of Bitcoin, Satoshi Nakamoto’s total stood at 980,000 BTC. Brown even claimed to know Satoshi’s identity and could confirm anyone claiming to be Bitcoin’s creator.

He said, “I could easily verify since I know what PC he was using, what part of the world he was living before he started to actually try to be anonymous on the net.”

Interestingly, Brown or KnightMB hit the jackpot when his employer lost interest in the Bitcoin project. Brown claimed he built BTC products for banks to generate massive amounts of Bitcoin.

With the bank server’s aid, Brown mined over 370,000 BC before the bank lost interest.

According to the chat room conversation shared by Bitcoin Historian, Brown managed to persuade his bosses to sell the project to him for $5,000. That was a way for his employers to recover part of their investment in the Bitcoin mining project.

Ultimately, Brown got 371,000 BTC for $5,000 or $0.0135 per BTC. This marked a breakthrough for Brown as his over 370,000 BTC later soared to over $1 Million.

$36 Billion Mystery: Lost, Hidden, or Still in Play?

Bitcoin Historian noted that Brown soon disappeared from the public space, with many wondering what happened to his massive Bitcoin holding.

Surprisingly, in 2012, Brown was arrested by the authorities. They alleged that KnightMB stole Mitt Romney’s tax returns and demanded a $1 Million ransom paid in Bitcoin. Notably, Romney was a U.S. Presidential candidate at the time.

Despite maintaining his innocence and having nothing to do with the purported extortion, Brown was arrested by the authorities. They traced him through a photo, supposedly of his cat, and this led a jury to indict Brown, who was sentenced to 4 years in prison. The court also asked him to pay $200,000 in fines.

Although Brown got his sentence reviewed after one year, he claimed the lawsuit left him poor. This has left many speculating about his 371,000 BTC – did he lose it, hide it, or still have access to it?

Analyst Highlight Lessons from Brown

Analysts say the early days of Bitcoin were wild as individuals amassed fortunes. They pointed out that not many could have predicted the growth trajectory of the asset.

For instance, Brown would have been a rich whale with over $36 billion worth of assets at the current average price of BTC.

Financial experts consider Bitcoin Historian’s post a cautionary tale about how potentially easy it is to gain immense wealth in the crypto world and still lose it.