The character is actually schizophrenic and highly paranoid. His magic is located in a tumor in the brain, which causes his insanity, so it could be say he'd have to choose between magic and sanity. Because of his condition, a lot of very crazy things happen to him, like secret societies and governments attempting to recruit or kill him, in serious conspiracies, among other fantastic creatures and events. Which of all this is actually happening, and what is purely delusional? The players that meet him decide.
Something like that? 
Clearly totally different
Ok, maybe a little similar. But not entirely the same. I wouldn't describe my character as 'insane' as he knows what the world around him is, he's just scared of the voices.
