Emergency funds and investment funds are created for completely different purposes so they should never be mixed together. Emergency funds are mainly kept to deal with sudden job loss, medical expenses, or any other unforeseen situation. Therefore it should always be kept in a place where it can be easily converted into cash and there is no risk of market fluctuations.
On the other hand, the money that should be used to invest in bitcoin should be the money that even if lost, your financial position will not be damaged, which is called excess or discretionary income. If someone invests in bitcoin with an emergency fund and the market falls, then it will be difficult to withdraw that money if necessary and will be in great financial danger. Therefore, it is necessary to keep a clear separation. The emergency fund will be in a safe and risk-free place, and bitcoin will be invested only with excess money. If you follow these boundaries, it will be possible to invest while maintaining financial security.
Emergency fund and reserve fund are not the same. If you only rely on emergency fund and reserve fund then it will not be right at all. If you are in the middle of some kind of financial crisis and then you have no money except emergency fund then it is not a good thing at all. Emergency fund is used when you have completely exhausted your money when you have no money except emergency fund and Bitcoin then you will use emergency fund.
Emergency fund is always best to keep in cash. Because you may need it at any time. If you keep your money in the bank and if your account gets frozen and you need the money then you may have to sell your holdings or take a loan from someone. That is why it is always best to keep emergency fund in cash