What happened to the hacker and the crypto advocate?

Kim Schmitz was born on January 21, 1974 in Kiel. According to his own statements, his childhood was strongly influenced by his father’s alcoholism. In his autobiography, the 48-year-old describes his living conditions: “My father was an alcoholic. Sometimes he admitted me and my mother to the hospital. “His mother had several jobs at the same time to keep the family afloat.

To escape from everyday life, Schmitz seeks refuge on the Internet and gives himself the pseudonym “Kimble”. After appearing on television in the mid-1990s, Schmitz built a thriving business that sold black copies through mailboxes. He can be paid with stolen phone credit cards, so-called “phone cards”.

The scam is quickly revealed. Following a raid, authorities seized a large number of counterfeit credit and phone cards. To ease the legal pressure, Schmitz switches sides and offers his services to a lawyer. For example, as a test orderer, he provides information about pirated copies. Nevertheless, in 1994, he was prosecuted for fraud, computer fraud, gang theft and misuse of titles. However, due to his willingness to cooperate, the sentence was relatively lenient – two years’ conditional imprisonment for the then 20-year-old.

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From hacker to young entrepreneur

Schmitz continues to make a name for himself and mutates from hacker to young entrepreneur. After encountering security deficiencies at Deutsche Telekom through a tip, the group offered him a consulting contract in return for his silence. With the help of the fee, Schmitz founds his next business project – die Data Protect Consulting GmbH. He later sold 80 percent of the shares in TÜV Rheinland. Insolvency followed in 2001.

In the midst of the dot-com bubble, Schmitz set up his own venture capital firm, but was charged with insider trading for certain incidents and given a further suspended prison sentence of one year and eight months and a fine of € 100,000.

In 2002, Schmitz emigrated. The 28-year-old is initially attracted to Bangkok. It was there in 2007 that he was first brought into contact with the company that would bring him his legendary status – mega upload. Although Schmitz is trying to intervene in the revelation that he is behind Megaupload, the information is leaking.

Megaupload is next door at this point Rapidshare and MediaFire one of the largest providers of file hosting services. The platform is funded by advertising and paid premium access. At the same time, the company joins mega video, megapixels and mega box in the areas of video, image and music hosting. During peak periods, about 155 people work for Megaupload Ltd.

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Megaupload and Kim Dotcom

In 2010, Schmitz is at the peak of his creativity. At that time, Megaupload had about 180 million registered users. The traffic on their platforms now accounts for about 4 percent of all internet traffic. For example, if you did not want to see new movies in the cinema, you just googled the movie titles at the time and spent a relaxing evening on the couch at home without spending a penny – thanks to Megaupload.

That same year, Schmitz decides to move again – this time to New Zealand, where he still lives today. To strengthen his status as a multimillionaire, the Megaupload boss adopted the name that the whole world will later know him by – Kim Dotcom.

The soaring dotcoms tentatively ended in 2012. On his birthday, police special forces stormed his property and arrested the newly struck 38-year-old and three other people. His assets will be confiscated and all megaplatforms shut down. The reason for the arrest is an arrest warrant from the FBI accusing Megaupload of more than $ 500 million in copyright infringement. The plaintiffs include not only the six major Hollywood studios, but also the American Music Industry Association RIAA. In March, the United States requests extradition. He faces up to 20 years in prison if convicted.

Schmitz achieved a first partial success in the legal dispute in July. After a few U-turns, however, the process is still running today.

From internet millionaire to crypto advocate

Away from the legal trench warfare, Dotcom wants to return to its old glory. In July 2016, he announced a relaunch of his sharehoster service with Bitcoin integration – but it never came to a release.

After evolving into an opinion leader on the crypto scene and launching his own blockchain-based service, the now 48-year-old spoke again in September last year. He warns of hyperinflation and urges his followers to buy cryptocurrencies.

Kim Dotcom is without a doubt the definition of a flamboyant nouveau riche who does not like to make his opinions known – and (profit-oriented) market them. He often had a leg in jail. The strife with the US judiciary has politicized him and thus also made him mature a bit. Yet dot-com is polarizing the masses. Some see him as a freedom activist, others describe him as a swindler and criminal. One thing he’s sure about – an internet legend.


The article has been editorially revised and first appeared in the November issue of BTC-ECHO Magazine.

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BTC-ECHO Magazine is the leading German-language magazine since 2014 on the topics of Bitcoin, Blockchain, NFTs and cryptocurrencies.

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