it is also better to choose DCA strategy, because if someone buys Bitcoin with a lump sum, then later if the price of Bitcoin decreases a little, he may regret it, so DCA strategy should be chosen to buy at an average price.
I think the idea of lump summing is basically dependent on the level of income of the individual or investor. And yes, If you have the income to lump sum I don’t think the idea is wrong to accumulate bitcoin and hodl. The DCA strategy is good, and so is lump sum. The idea is to buy and hodl for a long term goal and sometimes you feel like to buy in bulk and keep rather then buying little by little on weekly or monthly basis due to the fear that if the money gets to remain with you, you might use it for other things that are not really worth it so it’s better you use that money to lump sum and hold. Getting emotional about the market is most common among traders, weather they are DCAing or lump summing.
DCA is much better than lump sum. It can be seen that if someone invests a lot of money in Bitcoin at once, some problems can arise. First of all, the person who is investing a lot of money at once takes a long time to invest that money. Maybe many people do not have any other money saved apart from this money. Then if someone invests a lot of money in Bitcoin at once. After that, if he faces any major danger, such as a lot of money for his or her family's member treatment but he does not have it, then he will be forced to sell his Bitcoin holdings. The price of Bitcoin tends to rise and fall a lot. It can be seen that sometimes the price decreases or increases by more than 30% to 40% very quickly. As a result, the risk in lump sum investment is very high. So if the investment is not made at the right time, then a lot of losses may have to be faced.
For example, at the end of 2021, the price of Bitcoin reached ATH around $66,000. Then in 2022 and 2023 , the price was around aprox $20,000 and in 2024 it become higher than the price in 2021. So if someone had invested a lot of money at the ATH price of 2021, he would have been facing a lot of losses for a long time. But at the same time, those who had been investing through DCA for a long time were able to buy a lot of Bitcoin at a low price when the price fell in 2022 and 2023. As a result, the profits of those who followed their DCA were relatively high. Another advantage of DCA method investing is that there is peace of mind. There is no mental instability when the price falls, they continue to hold Bitcoin regularly according to their convenience. Now, due to the increase in the popularity of Bitcoin, everyone, poor ,middle class and rich, is showing a lot of interest in Bitcoin. So the most advantageous way for everyone is to follow DCA and invest for a long time through discretionary income. If an emergency fund and a reserve fund can be formed side by side, then future financial problems can be solved. There is no point in taking additional risks, including creating mental instability by investing in lump sums.
While am trying to understand everything you are saying, I think there is a reason while discretionary income discussion is all over the place and if the true meaning is what we are all looking out for in Bitcoin investment then there is no additional risks or any mental instability by investing in Bitcoin through the Lump sum because both the lump sum money and the dca must come from a discretionary income. Having Bitcoin and increase size of your Bitcoin and to hold for long should be the must concern and not even the strategies, more than 90 percent population can not afford to buy Bitcoin in the lump sum way so the dca strategy is still important for the over population.
