Bitcoin is a savings that is kept for the future. If a person creates Bitcoin as an emergency fund, then he is making a big mistake. Because investments are made for a long term period such as 5 to 10 years. And we create an emergency fund to protect our portfolio. But there are some people who use Bitcoin as an emergency fund. If you are a person who does this, then he can find himself in many bad situations. For example
*If the price of Bitcoin decreases and then that person needs money, then he will have to sell it at a loss
*If he sells at a loss, then he will be behind in terms of money and then that person will have to take a loan.
*He will break down mentally a lot.
*He may blame Bitcoin, such as Bitcoin is fake etc.
Bitcoin is very risky, but not for everyone. Because I think Bitcoin is very low risk for people who can have proper knowledge about Bitcoin and hold their holdings for the long term. Bitcoin is very risky for people who invest in the short term or use Bitcoin as an emergency fund.
The main reason not to keep Bitcoin in an emergency fund is to make it easier to use emergency funds in an emergency. Bitcoin is never a suitable currency for use in an emergency. Because it takes some time for Bitcoin to be converted into fiat, which can cause delays in using it in an emergency. Even price volatility tends to have a negative impact here. So, in order not to delay solving the problem in an emergency and not to face losses, it is absolutely foolish to keep Bitcoin in that emergency fund.
So you should create an emergency fund in such a way that you can use the emergency fund very easily and quickly. Always choose fiat money for the emergency fund and definitely keep it in real currency. Keeping the emergency fund in a bank or online money is also not advisable or the right step. Keep the emergency fund in a place where you can use it at your fingertips and from there you do not have to count the losses.