When we are referring to an amount of money that a person "can afford to lose," there is a psychological component.
Of course, a person could invest up to 100% of their discretionary income into bitcoin, yet if they make mistakes and they have no money left, then they might accidentally use money that they need for their expenses, so there can be dangers in using 100% of your discretionary income for investing in bitcoin.
If you can tolerate all that negative BTC price pressure, then sure maybe you have invested no more than you can afford to lose, but you are going to end up being financially and psychologically challenged if the BTC price moves against you... so you actually need to find some balance in which you are both financially and psychologically comfortable, which is also part of the reason that many people are not going to invest 100% of their discretionary income, and maybe they will find some way to be aggressive without over doing it, but maybe invest around 50% or 60% of their discretionary income into bitcoin.. so then they have the remainder of their discretionary income as a kinds of cushion.
one thing that proper planning and budgeting does for you is that it allows you take notice of not just what you want as your left over after you have carried out your expenses, it helps you also take notice of what you are spending your money on and how much is going into any of those things under consideration.
take for instance the data subscription we do every month, if you do not do proper budgeting but rather does daily or weekly plans, you might end up spending way more than necessary which will go on to affect other aspect of your finance and in the process eat into your emergency funds if you are trying to use it to cover for your subscription bills when the need arise.
once i have allocated my 30% for my investment, i just try to use the remaining 70% in a manner that regardless of what happens, i must adapt to what's left as though that is the only thing that i am earning. just that mentality that this is the only thing you are earning will force you to make all your plans to suit what you have left so needs does not easily eat into whatever you have both as your allocation for your expenses or your budget for your investment and emergency funds.