Storing all assets in Bitcoin is a good decision (to be faster in a heart attack and higher stress) lol.
With a fluctuating market, it is certainly not a good option for financial health.
This is the worst financial strategy to store all your assets in bitcoin because when their is a drastic dump in price,it will look like your doom day has arrived. A very bad way of financial management.
Part of the rationale to diversify at least a little bit in terms of NOT holding all your wealth in one asset class.. especially one as volatile as bitcoin, even though surely there are some people who engage in such a practice.. which does not seem to be good financial management or even advisable absent some pretty special circumstances. such as perhaps if they were to have a pretty guaranteed cashflow that allows them to NOT have to be reliant upon the value of their investment in any kind of way... but even then, for sure, there does seem to be some value in any ability that any of us might retain to be able to continue to buy on the dip or to DCA during dipping times, rather than completely losing confidence because our investment might have had gone down greatly.. such as greater than 70% and stayed at such depressed levels for extended periods of time.. including potential uncertainties regarding if such asset might continue to drop in value further and for much longer periods, too.
Those who store all their asset in bitcoin will end up not being able to hold all their bitcoin for a very long time,they will only be able to hold little fraction of 20% after a long time, due to the fact that we will be faced with an unforeseen financial challenges and before you know it since this is there only assets they will have no any other option but to use from their portfolio to tackle the problem.
Sure.. but there is still a balance even if choosing when to start diversifying if at all. Of course, a very early investor might spend a lot of time in which s/he has no other investment except for bitcoin, so it does not make a lot of sense to diversify for the mere sake of diversifying - even though I do seem to understand and agree with your point that at minimum, there may well be a need for some cash reserves in order to be able to take advantage of likely ongoing and potentially severe BTC price fluctuations and surely one of the ONLY thing that might get closed to being guaranteed in bitcoin is that it is going to be volatile.. even if we might not know exactly in what direction such volatility might end up happening.
It is only those who have overcome financial stability that can store all their asset in bitcoin. I don't think it will even be possible to store all your assets in bitcoin and still be able to hold for long. Even the whales or someone that have overcome financial stability is because he has a business or businesses that is fetching him his funds daily. If this type of person has like $1M and invest all into bitcoin doesn't mean that he has invested all his asset in bitcoin because his business is still on.
It seems to me that the vast majority of more well to do investors (and seemingly smarter investors) are likely going to have a certain amount of diversification in the assets that they hold - but philosophies in regards to how much diversification is preferable is going to have a decently large amount of variance in terms of both personal preferences and also in terms of some personal characteristics of the investor.. so I doubt that there is any exact one stop shopping when it comes to the question of diversification or not or how much to do it.
I agree with you on this, because every investors know how many bitcoin they want to accumulate. It all boils down to the mindset,income and bitcoin goal of individuals. Mr A might choose to start accumulating his bitcoin till it gets to 2BTC because he knows that in few years he can achieve that,and Mr B can also feel that all he needs is 1BTC and he try his best to accumulate this over some period of time. Likewise,Mr C can come up with not having an actual amount which he wants to accumulate but because he loves and believe in bitcoin, he decided to just keep on accumulating to see how many Bitcoin he can accumulate for a long period of time without a target in his mind. What you said it is true,some investors accumulate to their bitcoin goal and after some years, they decide in double their portfolio due to some reasons.
Yes when one feels that he has accumulated enough for himself,he can diversify to another asset. Some investors believes that there is a particular fraction of their funds that should be invested into various assets. For example, if he wants his bitcoin investment to be 10BTC,immediately he accumulates to that amount,he will stop and diversify to some other assets and nothing will change his mind because this was his plan.