Nicholas Harvey Raymond rose from small-time drug dealer to Bitcoin multi-millionaire

A small-time drug dealer who became a Bitcoin multi-millionaire is set to lose it all and become the world’s unluckiest crim after an FBI tip-off.

A small-time Preston drug dealer’s $1300 stash of drug money ballooned into an $18.9m Bitcoin fortune, but he is set to lose almost everything after an FBI tip-off led to his arrest.

Crypto king Nicholas Harvey Raymond, 31, has been warned he could be behind bars by Christmas after he pleaded guilty in Melbourne Magistrates’ Court Monday to dealing with the proceeds of crime and a string of minor drug charges.

The “unremarkable” drug dealer spent just a few months buying and selling drugs on dark web drug “supermarket” Silk Road in 2012 before getting clean and quitting the drug trade.

Silk Road allowed users to anonymously buy and sell drugs online, until the FBI shut it down in 2013.

By the time Raymond quit the site, he had 270 “coins” – then worth about $1300 – in a digital account, called a “wallet”.

But he forgot his password and was unable to access it.

The value of the cryptocurrency boomed in the years that followed, and in early January last year Raymond found a shady “computer expert” who could crack the password and get access to the fortune.

Nicholas Harvey Raymond, 31, arrives at Melbourne Magistrates' Court on Monday. Picture: Craig Dunlop

Police seized a Volkswagen SUV during a series of raids targeting Raymond’s unexplained wealth.

Raymond became an instant multi-millionaire.

He paid the expert “coins” worth $3.8m, kept $8.6m of “coins” for himself, and gave his former partner another $8.6m worth.

The transactions triggered a red flag with the FBI, which linked some of the coins to Raymond’s brief stint as an online drug dealer.

In August last year Victoria Police raided eight properties in Kinglake, Preston, Prahran, Dollar and South Yarra. They restrained two properties and all the Bitcoin under unexplained wealth laws, and impounded a Toyota Prado and a Volkswagen SUV.

Raymond and his ex-girlfriend were charged, but police later dropped charges against Raymond’s ex.

In a twist, investigators agreed on Monday that 148 of the “coins” were not connected to drug deals, paving the way for their potential return to Raymond, his ex and the computer expert.

But the value of the cryptocurrency has dropped since police restrained it, meaning the fortune is now worth about $3m and is plummeting fast.

Raymond’s lawyer, Felix Ralph, told the court his client did not realise how serious an offence he was committing when he tried to access his fortune.

He said the value of his client’s fortune was hard to calculate because Bitcoin’s value was notoriously volatile.

Magistrate Malcolm Thomas warned Raymond jail “really isn’t” ruled out when the case returns in December.

At the time of Raymond’s arrest, Victoria Police commander Mick Frewen warned the dark web made it easier than ever for normal people to commit serious drug and financial crimes.

“There may be a perception that trafficking drugs online is a ‘safer’ option or one less likely to lead to detection … anonymity, however this result highlights that this is absolutely not the case,” he said.