Generally it is a good idea to figure out some kind of an investment pace into bitcoin that fits within your budget, so you should be taking ONLY from the extra money that you have, and not money that you need for expenses. Surely there are some kinds of expenses that you might not know that come up down the road, so many times it is preferable to keep both an emergency fund and various kinds of back up funds so that you never have to tap into your bitcoin investment at a time that is not completely of your own choosing.
You are absolutely correct! I have made this mistake before and I know what it cost me to sell part of my Bitcoin at huge losses because I needed to attend to my urgent bills. This is not funny at all and I hope other investors would scrutinize your opinion many times so they can digest it, avoid similar attempt in the future. It is not funny at all when you intend to hold your Bitcoin for as long as possible and suddenly you had an emergency to attend to. I just hope such unfortunate event would never happen to us. Also this was due to unplanned necessity that needed to be put in place before making any financial investment. We just have to keep some funds so that in case of any unforseen bills, one can take care of it asap.
to me that most people should be considering bitcoin as an investment that is 4-10 years or longer, and the only reason to be thinking about less than 10 years is if you have age and/or health particulars that prevent you from being able to project your bitcoin investment in a longer timeline... .. so if we might presume that you are not fitting in the category of elderly or enfirmed, then we should presume your timeline to be 10 years or longer...
So you don't have to rush your investment. You can try to invest as aggressively as you are able to without overdoing it, yet if you do not have back up funds, you need to be trying to build them up at the same time that you are building up your bitcoin investment. Once you get your emergency funds up to 3 months (and then maybe you would have 3 months in bitcoin too), then you may be able to start to become even more aggressive in your bitcoin investment, yet you also have to consider that you don't even want to be tapping into your emergency funds, so you also might have to make sure that you build another month or two or more of various kinds of back up funds. I am not claiming to know your particulars, but each of us has to have these kinds of back up funds so that we are not forced to sell out of any of our BTC and we are not contributing to our own creation of emergencies in situations that no emergency should exist if we had engaged in better preparations. So it could be the case that you might need 5 months or more of back up funds (that includes your 3 months of emergency funds) before you are really able to become more aggressive in your approach to your bitcoin investment.
I know many of us would like to get rich quick (sooner rather than later), but investment takes time, and if we let our bitcoin build on itself (and even compound in value over time), we likely will still be able to enjoy greater feelings of wealth based on our having had built up our bitcoin investment, and it is also likely that our standard of living is able to go up after we have spent some time building our foundation levels of investment into bitcoin and also foundations to good cashflow management practices.
Buddy dont sound like you are not sure that hows it should be. Your right here, because i know this is not the first you figure it our that its truly the best strategy for everyone to consider Bitcoin as a 4-10 year investment plan.
I think that it is dogmatic to attempt to impose your values onto others, and yeah, frequently our posts are going to create impressions that we are recommending or telling others what to do, yet in the end, each person has to come to their own conclusions about whether to invest into bitcoin and how to invest into bitcoin, including recognizing and appreciating that bitcoin is not guaranteed to be successful, yet probably we could guarantee that no one is going to lose more than 100% that they put in, as long as they do not use leverage.
Many times, I use pretty strong language and call people retards who are arguing against investing into bitcoin, yet at the same time, I consider that each person has to figure out how to come to bitcoin under his own direction, and to be responsible for his actions and/or inactions in regards to investing into bitcoin or not doing so.
However its not like its necessary for all investors to set longer time frames because some might have financial situations which make them so set shorter time frames especially based on personal goals.
Some of my own ideas (opinions) have evolved on this topic, and I have come to conclude that investing needs to be 4-10 years or longer other wise it is trading if it is less than 4 years, and even the time frame of 4-10 years would be short term investing and potentially trading, except surely some folks do not have an ability to commit towards investing into bitcoin for more than 4-10 years because of age and/or health considerations.
I am mostly against trading bitcoin or getting into bitcoin for less than 4 years to try to play bitcoin's price wave, yet I can understand that some folks might choose to take those kinds of chances with money that they believe they need in less than a 4-year time horizon.
There can be exceptions for longer time frames but to invest for less than 10 years, the risk of selling too soon increases. That is why having an emergency fund matters a lot. Emergency fund will prevent the investor from selling their Bitcoin when those health challenges occur.
None of us can really particularize the extent to which someone might consider that they are not able to commit to investing more than 10 years, and there are some folks with serious health concerns (or degenerative conditions) that the are already expecting to cut into their cashflows, and aging itself is a degenerative condition in which folks might consider that they are not ready, willing or able to increase their income sources, and they might even have income sources that they already know are drying up within certain timeframes, so then they would be expecting to draw on their bitcoin to supplement their income sources that they expect to be drying up. We cannot necessarily wish away another persons assessments of their timeline based on health/age considerations, and they might already be in a situation that they acknowledge that they might have fucked up in their younger times, but they have to work within the parameters that they are rather than trying to turn back time and be able to do it over.
Emergency fund is not going to do shit to save some folks from already known financial cashflow constraints, perhaps already known cuts to housing and food budgets, and perhaps even years of already liquidating various assets and/or properties. Many times we consider emergency funds to be short term interventions that might deal with sudden loss of income or increase in expenses that might be rectified after some time for someone who might be still able to work, but still some emergencies might be happening when folks are in their late 50s or into their 60s, and maybe they are not in a position to recuperate from any emergencies that might be covered by the emergency fund for the short term, but then they might have to transition into some status in which they have more of a longer term loss of income or increases in their expenses.
Even at old age it does not limit the investor to project their investment to a decade because they can set it aside for their heirs to inherit. Age is not a limitation to how long we can project our investment in my opinion.
You are living in a fantasy, if you are trying to impose your own expectations of your own situation (or how you might prepare yourself) as compared with our talking in generalities about how some folks might be limited by both their age and also by various preparations (or lack of preparations) that they might have had been able to succeed in in their earlier years, perhaps when they still could earn income.
There are financial preparations, social support system preparations (such as family), infrastructure preparations in regards to where a person might be living and there can be a lot of limits in terms of a persons geography or nation or even if they might have various physical limitations.
Sure age might not always be a major factor if some elderly folks might have various fall backs, but we cannot presume certain kinds of fall backs to exist, especially when we are talking about these potential kinds of limitations in general ways.
It seems to me that most people should be considering bitcoin as an investment that is 4-10 years or longer, and the only reason to be thinking about less than 10 years is if you have age and/or health particulars that prevent you from being able to project your bitcoin investment in a longer timeline... .. so if we might presume that you are not fitting in the category of elderly or enfirmed, then we should presume your timeline to be 10 years or longer...
I have found out that long term holders are the ones that are making the most profits from Bitcoin because of the patience to hold for couples of years as the price of Bitcoin keeps hitting more Xs gradually.
Some of the 3x to 5x to 10x will come in bursts, and sure the BTC price may go back and forth, but there are certain periods that any of us could end up getting fucked if we choose to shave off a certain portion of our BTC hoping to buy back cheaper, but then the BTC price goes shooting up rather than down.
It is not even really that long ago to consider up to 7x between the lows of 2022 until the recent high of $109k in January, so there can be periods in which the price moves up quite a bit and then does not have very much likelihood of correcting back down (even though the extent of any future correction is never completely known, but we get some ideas that at some points, we are not too likely to be revisiting some of the lower price arenas).
Holding Bitcoin can even be more profitable than trading it because in trading, you can make a profit of $5k this month and by next month you could be lossing $8k because of the uncertainty in the crypto market. But when you are holding Bitcoin, even though price keepa going down, you will see it as an opportunity to buy more bags rather than complaining of your crypto portfolio value reducing. Holding patiently is a great virtue!
I think that there are some truths in the various assessments that there are only a few days each year (like maybe 10 or so) that most of BTC's profits are made, and if you happen to be out of BTC at that time, then you miss most of the gainz. It is not easy to really know in advance when those 10-ish days per year are, which causes a decent amount of justification to not even take the chance of being out at one or more of the wrong times.
So you don't have to rush your investment. You can try to invest as aggressively as you are able to without overdoing it, yet if you do not have back up funds, you need to be trying to build them up at the same time that you are building up your bitcoin investment. Once you get your emergency funds up to 3 months (and then maybe you would have 3 months in bitcoin too), then you may be able to start to become even more aggressive in your bitcoin investment, yet you also have to consider that you don't even want to be tapping into your emergency funds, so you also might have to make sure that you build another month or two or more of various kinds of back up funds. I am not claiming to know your particulars, but each of us has to have these kinds of back up funds so that we are not forced to sell out of any of our BTC and we are not contributing to our own creation of emergencies in situations that no emergency should exist if we had engaged in better preparations. So it could be the case that you might need 5 months or more of back up funds (that includes your 3 months of emergency funds) before you are really able to become more aggressive in your approach to your bitcoin investment.
I have some backup funds scattered in fiat so in case of any emergency bills, I can attend to it asap without any panic.
Experience is the best teacher and I've learnt the hard way and I hope that other investors whether short term or long term would make sure they have a backup funds to take care of any emergency that ever comes their way.
There may be several ways in which none of us would completely have 3 months of cash just sitting around, even though the idea of emergency funds is that it should be pretty liquid and it should be in our local currency (or some kind of a stable currency, such as dollars).
There are probably a lot of us who might have cash crunches from time to time, so we may well end up having to move around various funds or to prepare ourselves for some expenses that we know are coming in in the near future. Sometimes we might have various sources of funds (or assets) upon which we can draw, if we need some cushion money, and we might not even realize, sometimes, how we might be running out of various kinds of cushion funds of if we might have to attempt to draw on an asset or currency that is less liquid, such as knowing that we might need to have around 4 weeks before we can have that asset/currency available to us. So one thing is how available the asset/currency is, and then another thing might be questioning how volatile that asset might be compared with our local currency (presumptively we are paying bills/expenses in our local currency, mostly).
As I am investing in Bitcoin, I am also making sure that I invest in physical business so the profits I'm getting from the business can be used to grow other businesses and as back up funds.
Businesses in themselves might not be a better place to put money as compared with bitcoin, yet if you are involved in a business, then frequently value that you are putting into the business might be able to help to leverage various skills and/or abilities and/or position that you have so that you can earn an income from your labor and/or your skills. So for sure when we are building our bitcoin investment, we need to be generating income (many times from our labor) to then perhaps later get to a point that we might not need to work in the future to be able to live off of our investments. bitcoin and perhaps some other investments that we have that may or may not require much if any work input from us.
Yep. If you are using money that you know that you are going to need, even a few months down the road, then you are trading (gambling) rather than investing, and any of us can make mistakes to take chances with our expenses and then we end up making mistakes. I have made those kinds of mistakes on more than one occasion, yet we we see that the mistakes tend to have greater repercussions than if we had followed better practices, then we realize that we have to figure out ways to make sure that we are not engaging in behaviors that increase the chances that we are going to end up having to suffer through those kinds of repercussions.
In other words, we have to try to make sure that we are not gambling with our investment, and we are truly using money that we do not need to make our bitcoin investments. It can take a while to build up these kinds of better practices, and sure sometimes we are going to feel that we have too much cash sitting around and not doing anything, yet after we have experienced some of the difficulties we will also come to realize that even cash sitting around is serving a purpose, and we should be able to become more and more comfortable with our chosen balance, which means that we are getting better and better at managing our cashflow balances.
To be frank, there are lots of people that tend to invest their money in Bitcoin without knowing that they are indirectly gambling with their investments. Just imagine trying to use a little amount of capital, let's say $100 to make $30k because there are rumors that some people, maybe traders are investing in new projects that is giving them huge profits, maybe as high as $10k from a single crypto projects.
Newbies are the ones that do fall for these kind trap. Instead of them to invest in Bitcoin and keep holding their Bitcoin portfolio even though it's not as much as we think, some would want to make huge profits from the crypto market by invest in memecoins instead of Bitcoin where they have have full relaxation that their invest is safe and secure from rug pulls. Trading is a form of gambling but from a different perspective. A trader can not always be in profit but an investor can always be on profit especially holding great asset like Bitcoin without selling your portfolio even when the price of Bitcoin is down.
Yes, having bitcoin can create opportunities to be able to enter into other kinds of investment (trades/projects/shitcoins), and so there can be an alure of being able to leverage bitcoin and to be able to increase the bitcoin, which like you say, may not end up doing too well in terms of how a person is choosing to use his time, energies and his bitcoin.. and he may well would have had been better to just focus on building his bitcoin through more mundane ways of buying it on a regular basis and working on earning income in other ways to just buy bitcoin. So if we keep buying bitcoin persistently, consistently and regularly, there should be some assurance that our bitcoin stash is growing larger, yet we cannot always have confidence that our bitcoin is going to go up in value.
If we study and understand bitcoin, we should be able to recognize and appreciate that bitcoin as an asymmetric bet to the upside, so the most we could lose is 100%, while at the same time there is ongoingly great upside potential including that it might be the best investment available, yet even if bitcoin is the best investment available, it is still not guaranteed to go up in value.
Surely it tends to be a much better feeling when our bitcoin holdings are in profits as compared to when they are not in profits, so there can be degrees of bad management, and the worst would be selling at a loss, and surely it is not as bad to sell at a profit, yet it is still not good BTC portfolio management to be selling your investment merely because you are either engaging in poor cashflow management or you are tempted to tap into your bitcoin investment at a time that is way before your 10 years or more investment timeline.
Another value of holding onto your bitcoin investment for a long time is that its value continues to compound upon itself, so instead of getting profits that are less than one doubling, you may well end up getting several doublings, and the doublings really compound upon themselves.
In one of my earlier posts I outline 9-ish doubling from 2015 to present, which also shows that each doubling becomes more powerful resulting in 256x in profits or maybe even 512x in profits after the next doubling. If you continuously take money out, you end up missing out on the compounding events that are not guaranteed but still bitcoin has not really weakened in the strength in its investment thesis over the past 10-ish years, even if some of the upside potential is not as exponential.
So, let's look at the historical numbers and the timeline from 2015 to present again.
0) $250 (2015) 1X
1) $500 (2015-2016) 2X
2) $1,000 (2016-2017) 2X * 2 = 4X
3) $2,000 (2017) 4X * 2 = 8X
4) $4,000 (2017-2020) 8X * 2 = 16X
5) $8,000 (2017-2020) 16X * 2 = 32X
6) $16,000 (2017-2022) 32X * 2 = 64X
7) $32,000 (2021-2023?) 64X * 2 = 128X
8 ) $64,000 (2021-?) 128X * 2 = 256X
9) $128,000 (?) 256X * 2 = 512X
Bitcoin has really appreciated from nothing to a great project many firms and whales are looking ahead to accumulate for a lifestime profitability. For Bitcoin to have 512X since 2015, it means that the future is bright and Bitcoin could hit more worth as the adoption keeps increasing. It means that if we start counting how many x Bitcoin has reach from 2010, it could exceed 2000x from the beginning.
I suppose that I was choosing to depict bitcoin within my own timeline of being in bitcoin, even though frequently, I don't like to go back before 2012 when making comparisons of bitcoin to other assets, since prior to 2012, bitcoin had a price less than $5 for much of that time (even though I know it shot up to $32 in 2011), but still I don't tend to consider it fair to be using bitcoin prices prior to January 2012, and January 2012 we can use $5 as kind of nice round number as bitcoin's price starting point (in order to attempt to be more fair). I know that there are some folks who are starting from even later dates than me, and I am not even opposed to some ideas of starting out looking at bitcoin at $1k in order to make comparisons to other assets/investment possibilities.
I read all you said and I must commend you for your wonderful write up, Bitcoin is a very investment, i really don't know why some people don't like Bitcoin investment maybe because Bitcoin is volatile in nature but see nothing wrong with that as long as Bitcoin keeps growing, my regret is not mining Bitcoin and also not starting Bitcoin investment when the price was very small, I have friends who started accumulating and holding Bitcoin when it was not up to $500 and some are still holding till date why some have sold there own and has made huge amount of money that has changed there life and they can never be poor again, but I'm happy I didn't wait till today, one of them introduced me to this forum and I have been that a lot of people here and accumulating and holding Bitcoin you guys should keep it up Bitcoin has a great future.
