Quote from: Mr_Brilliant$ on September 13, 2025, 08:36:56 PM

Quote from: JayJuanGee on September 13, 2025, 07:30:44 PM

[edited out]

I really get your explanation and honestly, you broke it down in a way that makes sense to me now.. Pointing out that there’s a clear difference between an emergency fund that sits to cushion uncertainty, and a dip reserve that could sometimes end up being more about over strategizing than actually building Bitcoin wealth.. and you mentioned the trade offs involved, and I like that point, because the truth is, there is always a cost to every choice, and I had not been considering that side properly when I was making my earlier argument…

The truth is, the reason why I had been thinking that way is because outside of Bitcoin, in my other real world biz, I usually do set aside some money that is not tied to anything urgent.. With the mindset that when a promising deal comes up, something I know could turn out well, I can quickly take advantage of it without disturbing my main funds.. That approach has worked for me in the past, so I just carried that same mentality into Bitcoin as well…. I thought of keeping a little reserve on the side, not to waste, but just to strike when I see a chance. That’s why I was defending the idea so much, because in my normal biz, that is exactly how I operate…

For sure it is good that you have real world experience, because that is going to help you to really engage with the topic and the practice, and through practice, you were probably able to find a balance regarding how much money you might hold on the side and then how much you could draw from that extra money on the side if you had been presented with an opportunity. You likely realized that you could only draw so far down, and you had to keep some extra cushion just in case you calculated wrong or that other expenses came in or maybe some income did not arrive... so there tends to be a practical difference between emergency funds that we likely are not going to draw upon and we are likely not going to allow our back up funds (or our reserves) to go below a certain point otherwise we are cutting it too thin, and likely those would be the emergency funds, and perhaps we even had made mistakes in the past when we draw too much from our funds or maybe we miss opportunties because we are afraid to spend some of our reserve funds because we think that we don't have enough to cover the just in case bad things happens extra cushion that we might get used to keeping. We likely get into a stressful situation if we start to run out of money and if income is not enough to cover all expenses and we start to deplete our back up funds.

Quote from: Mr_Brilliant$ on September 13, 2025, 08:36:56 PM

But after seeing how you explained it, and also from what yixichloro2xx already pointed out earlier, I can see now that Bitcoin does not really play by those same rules.

Bitcoin is similar to other places that you might put money, yet it tends to be quite volatile, and if we give a priority to trying to hold onto our bitcoin for 4-10 years or longer, then we likely have to maintain even a greater cash cushion than we might have had in our previous practices.. But if we might not be very serious about bitcoin or we want to be sloppy and/or take chances, then we might end up engaged in practices where we are using our bitcoin as our emergency fund, and a lot of guys have historically sold bitcoin too early because they were sloppy in their cashflow management and not keeping enough of a cash cushion, so they end up getting themselves in a place where they have to sell some or all of their bitcoin, and they might even still be selling their bitcoin at a profit, but they might also be selling at a bad time in which the price is prone to go up after they sell and then they end up either not being able to replace the bitcoin that they sold or they might even give up on bitcoin because they cannot easily get back to the position that they had been at earlier.

Quote from: Mr_Brilliant$ on September 13, 2025, 08:36:56 PM

Like you said, the dips we expect may not happen, or not in the way we picture them, and holding back too much might end up being a wrong mindset for someone like me still building my stash. It is true that steady accumulation is better than waiting for some perfect entry point..

So I really appreciate the way you broke it down…

You have ONLY been registered on the forum for slightly less than a year and a half, and surely I understand that it can be tough to accumulate bitcoin during a period in which the price is ongoingly going up, and maybe some of us (including you) are not in a position to be able to front load our investment into bitcoin, so we can only really inject extra money as we get it. Accordingly, it would have had been better to buy earlier, but we did not have money and maybe we were buying as aggressively as we were able to do..

The same is true now. We cannot really know if a dip is going to happen or not, so we are really stuck with the price as it is, and we might end up screwing up our own focus by thinking about dips that might not end up happening.. Yet, we are still responsible for whatever we decide to do based on what we know, and I really think that it is too difficult to know the price and so many of us might have to just keep our heads down and keep accumulating bitcoin and maybe reevaluate from time to time along the way whether we might want to change our strategy, yet at the same time, we might not really be in a position to know or to change our strategy until we spend a whole cycle or two accumulating bitcoin.

If you are able to front load your investment and perhaps get a year or two of your expenses into bitcoin in the beginning, then maybe you can shorten your accumulation timeline. Otherwise, it tends to take a long time to really build any investment, including a bitcoin investment, and sure you are the only one to know the extent to which you might be able to front load your investment or if you are merely just putting somewhere between 5% and 25% of your income into bitcoin and trying to figure out how to build your
BTC stash so that your BTC stash can help to inform you in regards to the extent to which you might need to change your BTC accumulation strategy.