I have a friend who moved to Thailand a few years ago to half-retire, half become a digital nomad. We are not close enough for me to know his net worth, but I know that it was at least a couple of million dollars when he started this adventure two years ago. Not enough that he felt he could quit working forever, but enough that with the help of geo-arbitrage, his family would be comfortable while he grew his online business.
They weren’t living a lean-FI lifestyle in a foreign country. They chose Thailand because his wife is Thai, and they wanted their kids to experience her home country. They had a nice apartment, and his daughter was attending one of the most expensive international private schools in Bangkok. While not a part of the FI community, we would call him some sort of coast-FI where he supplemented the income from his digital business by drawing down his investments when needed.
His days were spent taking his daughter to school, visiting coffee shops, and playing table tennis, pickleball, basketball, and squash. In Thailand, you can eat healthily at a fraction of the cost in the US. And he worked online a few hours a night, as the time difference between Bangkok and New York City is 14 hours. All in all, it was a great life.
Wish You Were Here
Our families have spent part of the past two summers together. We have similarly aged kids who get along well, and the adults all seem to like each other. Last year they visited us in Hawaii, and then we all traveled to Japan. This year we met them in Bangkok, and then we all traveled around Thailand. We have the same travel philosophy and temperament, which is incredibly important when families spend weeks together.
We have also shared roughly the same socioeconomic status, or at least the same outward expression: we have money but choose to travel inexpensively (but not cheaply) and prefer experiences to objects. Think premier economy instead of first class. We mapped our joint journey around islands in Thailand well in advance, looking at relatively high-priced vacation homes instead of expensive hotels, so that all nine of us could comfortably stay together, while still enjoying a pool, gym, and some other amenities.
We would make up the cost of this “luxury” housing by flying coach, taking ferries, and eating low-cost food. Also, traveling with a Thai native assures you won’t get the “special” Westerner price everywhere you go. But something happened earlier this year that threw a small monkey wrench into our vacation plans, and the other family’s idyllic lives.
A Momentary Lapse of Reason
A few months before the trip, our friends informed us that they were having some financial difficulties. They still wanted to proceed with our travels, but requested we scale back the housing arrangements to a more affordable level. We obliged, and then just paid for the whole Airbnb costs ourselves.
A quick aside: after becoming FI, I decided that I would never let money be the reason that a friend couldn’t come on a trip. I have paid for several of my friends to travel with me over the years and have always considered it money well spent. Just this summer we also paid for the flights for a different family to visit us in Hawaii, and we all had a wonderful time. As mentioned, I choose experiences, relationships, and memories over objects every time. Back to the story.
Once we arrived in Bangkok, I got a better idea of what happened to my friend’s finances. It turns out that he made most of his money through Bitcoin, first “investing” in around 2012. The meteoric rise in the cryptocurrency’s price fueled his net worth and his eventual semi-retirement.
He apparently still kept most of his net worth in Bitcoin but also had doubled down by investing heavily in a private company that mined it. There was allegedly some fraud in the company (surprise, surprise), and he lost that investment. There are legal proceedings in place, but it is unlikely that he will see any of his money returned.
Unfortunately, he compounded this loss by buying more Bitcoin on margin . . . . just before the price collapsed by 50% between October 2025 and February 2026, effectively wiping him out.
The Final Cut
Not only did my friend need to scale back his vacation spending, but he also had to take his daughter out of her private school in Bangkok and move to a cheaper rental in a less expensive city while he sorts things out.
You may be thinking that my friend is an idiot and deserves what happened to him. Schadenfreude is real after all, even if you don’t speak German. But I think there is much more to it than that. He is far from stupid. He didn’t come from money and has been entrepreneurial all his life, owning many different businesses along the way. He may have made some bad choices recently, but he made enough good ones in the past to have millions of dollars to lose.
If you have money, you are at constant risk of losing it. It can be stolen, squandered, gambled, or inflated away. Most people are one job loss, injury, bad business deal, or extended bear market away from catastrophe. Let’s look closer at what happened to my friend, his exact mistakes, and what we can do to avoid them.
The Dark Side of the Moon
I have been defrauded. I wrote an article about it for the White Coat Investor. It’s embarrassing, but it happened to me, it happened to my friend, and if you aren’t careful, it could happen to you. Medical professionals are often targets of fraud because we have money and are notoriously bad with it!
Shady people are plotting and scheming day and night to take your money. You may never be able to prevent fraud completely, but at least don’t make it easy for them. Protect yourself by doing the following: educate yourself about investing and finance, perform due diligence, seek advice from others, and diversify your investments. A good place to start is to read the article I referenced above. You can learn from my mistakes.
More
As humans, we have a near insatiable desire for more. My friend took risks that paid off in order to get to FI but couldn’t take his foot off the gas. If he had not been so concentrated in Bitcoin, he would not have been at risk of losing everything. If you find yourself sitting on a huge winner, from a stock like Nvidia that took off, a company you sold, or great timing with cryptocurrency, take some chips off the table. You don’t have to keep letting it ride. Diversify. Buy broad-based index funds. Buy bonds. Invest in REITs. Once you have won the game, stop playing.
Animals
As human animals, we are prone to cognitive biases. His first mistake was losing money to fraud, but he compounded this error by trying to make it all back at once. It is common for people to take increased risk after a loss in an attempt to win it all back. This is gambling, not investing.
Additionally, my friend was overconfident in his ability to time the Bitcoin market. Because he had been successful with Bitcoin in the past, he thought he could go to that well again. But this time he bought it at the top of the market and quickly had the rug pulled out from under him. Physicians are prone to overconfidence as well. As I repeatedly say, just because you are good at one thing (medicine) doesn’t automatically make you good at anything else (like investing).
Meddle
Leverage is a two-edged sword and should be regarded as the dangerous weapon it is. By taking on leverage to buy Bitcoin, my friend let himself open to catastrophe. If you buy with 100% leverage, the investment only has to lose 50% to wipe you out. For example: you buy 20 Bitcoin for $120,000 each, spending $1.2M of your own money and borrowing an additional 1.2M. If the price drops to $60,000, your 20 coins are now worth $1.2M, and the bank wants their money back with interest.
Use leverage only to buy real estate or to start a business, and even then, be careful. As a medical professional, you have a wonderful engine to produce cash flow (your job). You don’t need to lever up to make your money faster. Slow and steady will win the race.
Conclusion
My friend’s finances were precariously stacked up like dominoes that looked stable but were vulnerable to a well-placed nudge. He was poorly diversified, having most of his money in a single, volatile asset. His prior experience with Bitcoin told him that he was on a long ride up and to the right, and that what had worked before could work again. His desire for more led him to invest in a project that he felt was secure in an asset class he thought he understood. The subsequent fraud left him in a vulnerable position, both financially and emotionally.
Instead of taking his losses and moving on, he further pushed his chips onto the table, trying to win back what had been taken from him all at once. He admitted to me that he wasn’t thinking clearly at the time, which is a normal response after suffering trauma like financial fraud. Bad timing and the use of leverage made a serious but non-fatal downturn in the price of Bitcoin a mortal blow. The wonderful life they had built in Bangkok is now gone, and all that is left is a pile of dominoes on the floor.
My friend is smart, resilient, entrepreneurial, and owns a successful business that produces cash flow. He also has one of the most positive attitudes of anyone I have ever met. He is once again making smart decisions, having substantially reduced his family’s lifestyle while he works to regain what was lost. Most importantly, he has a great wife and two healthy kids. If anyone can rebuild their financial life after a setback like this, it is him.
I hope you have learned something from what happened to my friend. We are all a series of unfortunate events away from financial difficulties. Still, you can reinforce your dominos by educating yourself in personal finance, diversifying your assets, using leverage sparingly, and knowing when you have enough. A great place to start is to read Personal Finance Basics for Medical Professionals Part One.