I see this quote all the time, thanks dad but I can figure out how much I have to invest. When the price was $17 I took out $10k from my Roth IRA and bought bitcoins. Was that more than I could afford to lose? What does that even mean? Most people with a job can lose everything and because they still have a job they can keep going.
So fuck it, here's my advice. Invest everything you can put together. The price is damn low and we're probably within 10-20% of the bottom (current price, $325). Drop your damn Roth...they'll find a way to tax it when you retire. Investing more than your company's matching into your 401k? Fuck that, dump it into Bitcoin. Any equity on your house? Refinance, put all of that money into bitcoins...the dollar will lose value in the next 30 years to the point where your $100-$300k mortgage will be pocket change.
This is horrible advice. Bitcoin is far from certain to succeed over the long term, and even if it is successful it is far from certain that it's price will continue to see the dramatic returns that we saw over the past few years.
In your "story" you failed to mention the overall value of your IRA as well as what happened to your
investment gamble in bitcoin.
What happened to my investment in bitcoin? I lost it all. Half I lost by day trading getting it up over 800 bitcoins only to fall on bad leveraged short and long positions during the manipulation days of Bitcoinica. The other half I sold at $12 to put toward a downpayment on a house.
So ya...I lost it all (other than having some for my down payment).
But I'm still alive, I have a job. I'm still making money. The risk was high and I lost money.
But then I started buying back in at $22...$10k from my Roth is a tiny bump in the road.
If you were attempting to leverage trade the bitcoin market then that by definition is going to be gambling despite any argument of the likely hood that the price of bitcoin will rise over the long term.
Yes you are still alive (good) and yes you are still earning money via your job (also good) however your retirement fund has taken a hit (bad). If you are very young then it may not be as big of a deal as you will have a long time to recover from the hit you took; however generally speaking it is not good to be investing large percentages of your retirement funds in something as high risk as bitcoin