I have a problem with people even having to use part of their Bitcoin holdings to trade. I believe in separation of concerns and precision which spurs effectiveness.
Why will you even be trading with your bitcoin holding? It doesn’t make send to me, if you are planning to hold your bitcoin, then it’s better you hold, but if you want to trade, then just focus on that, and if you are planning to do the two, just split the money you are having, leave some in your investment wallet, and be trading with one part on exchange, but touching your investment money frequently doesn’t really go well.
For anyone who is going to trade, it is likely important to keep some separate accounting and separate accounts, so that the trader never taps into the investment account, and if he wants to build his trading account, he need to accomplish that through building his trading balances. It can be quite difficult for traders to sufficiently/adequately segregate their accounts, especially since they likely devolve into gambling behaviors, even if they had previously not been so much of a gambling type.
I think if you must trade, trading wallets should be handled separately and holding wallets should be treated separately.
Traders do make use of exchange to trade, so most of them do leave their coin on exchange pending when they won’t be trading for some time, before they withdraw it, but if you are planning to hold, then your money shouldn’t be on exchange, you should be in control of your money always, don’t leave you money in exchange, because if anything happens to the exchange, you might end up losing your money, and we should know that no exchange is too big to be compromised.
There could be ways for traders to keep their funds off of exchanges especially if they believe that they might not need such funds for a while, yet it seems that a lot of times traders are going to want their accounts to be working (serving some kind of a purpose), including frequently needing liquidity, even when moving between positions, and yeah there may be some traders who are moving funds (and getting in and out of positions) more frequently as compared with other traders who may be willing to hold some assets for longer timelines. There is a lot of variability in timeline preferences, and some kinds of tools (financial instruments such as options, futures, margin leverage) that they use or the kinds of assets that they are getting into and out of may well help to inform them regarding how long they might want to try to stay in an asset or not, or what conditions might need to be met before they get out of such position..