F dca'ing, buy the dips and sell the rips!
Screw that. Buy when you can. Sell when you must.
Depends on where you are at in your bitcoin journey no?
Of course, many of us do not agree with the bullshit trading (gambling) ideas that the the seeming troll TrustedBitcoiner seems to be promoting, yet if we focus on BTC accumulation and you are new to bitcoin, then you may well still be building up your BTC accumulation target level.
So yeah, most of us do not agree about selling as a strategy to accumulate more bitcoin.. it does not tend to work out too well.. especially selling when BTC prices are below the 200-week moving average which is right around $24.4k right now and like even when the BTC prices are below the 100-week moving average, which is just below $38k right now.
If you largely already built up your BTC accumulation target level prior to 2016, then you are likely in a different position and can sell whenever you want, but you might not be too excited about selling very many BTC below the 200 week moving average and you may also hesitate a bit to sell below the 100 week moving average - even though selling relatively modest amounts between the 200-week moving average and 100-week moving average is likely NOT going to be detrimental for anyone who has been in bitcoin for a while, especially the ones who had accumulated quite a bit of their BTC stash prior to 2016.. and I am pretty sure that you, Jimbo, had acquired quite a large majority of your BTC even prior to 2013.. .. yet I think with any of the longer BTC HODLers there is a bit more comfort to sell if the BTC price is going up or even if it is stagnant for a while and some level of resistance to sell when the BTC price is going down, if such selling can be avoided.. based on other life circumstances.. so in that regard, longer term HODLers may well be more motivated by external life circumstances rather than giving too many shits about if the BTC price happens to be UP, DOWN or Sideways.
@jjg...I don't think your numbers really prove anything as one could have gotten 200 BTC in 2015 (at $250) for $50K or 100btc for 25K instead of 20 for $5K as far as bulk purchase is concerned.
You seem to be fighting with my hypothetical as if the hypothetical is not realistic. Part of my point is that people may not even be able to financially inject large amounts of dollars into BTC in chunks as you are suggesting, so it is quite possible that a newbie to bitcoin might be way more able to psychologically gear himself/herself into a way larger bitcoin investment by doing it on a regular basis rather than waiting around a lot and not really having (or developing) ongoing investing conviction.
You can fart around with the numbers or fight the hypothetical (the two options that I showed), but I doubt that my numbers are unrealistic in terms of what they represent and the points that I was trying to make
I still posit that earlier on, bulk btc purchase was better than DCA. Nobody stops you to do a small DCA later, sure.
Yeah, of course, retroactively you can look like a damned genius because after the price develops you can describe facts in which you would have been better off to lump sum invest and to mortgage your second child, but the reality of the matter is that normies tend to have limitations in their budgets and their cashflows, and even people who might have an already existing $80k investment portfolio may well be reluctant to peel off $8k or more to add a new asset class and instead, even if they might want to get up to 10% (or $8k) in their bitcoin allocation, they may well choose to aggressively buy in over a year or two rather than selling one asset and reallocating that to bitcoin... that's assuming that they even have that much that they would be able to lump sum invest into bitcoin, even if they had the will power to invest into something like bitcoin in that kind of a lump sum way.
What I am getting at is that, apart from bitcoin going to $5-10mil or more in the period that is longer than usual investor timeline, say 20 years, it is difficult to imagine that current small DCA of a thou or even 10 thou a year would result in a TRUE wealth in a foreseeable future.
The case for DCAing into bitcoin is not weaker than it was in 2013/2014. The example that I gave in my earlier post was a bitcoin newbie who started to invest into bitcoin at $240 per week at the top of the 2013 bitcoin price and invested for 4 years, so ends up investing $50k.
Of course, you are not necessarily going to get the same performance, so maybe a person now might need to be even more aggressive and shoot for investing $100k or $200k in the same amount of time.. which would be $500 to $1k per week, which might not be doable... and surely I already said in one of my other recent posts that even if I were more aggressive than I had been in 2013/2014, now I would ONLY be able to accumulate around 5% to 10% of my current bitcoin holdings, and that's being somewhat charitable towards my current ability to attempt to buy any kind of substantial amount of bitcoin approaching my current bitcoin.
Having said all of that, I doubt that the case for lump sum investing is any better than DCA in terms of the points that I already made. Anyone who is new to bitcoin or new to investing would just need to be as aggressive as they are able to be, but not overly aggressive. Same was true in 2013/2014 too. We don't know the future, but DCA still seems to be the best way for anyone to exercise aggressiveness in a measured way that is within their abilities and with likely an ongoing good return on their investment as long as their investment timeline is 4-10 years or longer and if their investment timeline is 15-20 years or longer they still would likely outperform traditional investments... Of course, no guarantees, either. What else are you going to invest in? Are you recommending something that is not realistic in terms of going forward for normies?
When I came to bitcoin in late 2013, I already had spent well over 20 years in other investments. Of course, bitcoin was not available to me earlier, and I did not even really know about bitcoin prior to my getting into it in late 2013. There are some people who are new to investing and who are likely going to have way better investment performance than me because they have bitcoin as an option... so their 30 years of investing may well be better than my 30 years of investing, assuming that they are able to manage their bitcoin investing without screwing it up... hahahahaha.. who knows if I might have screwed up my investment portfolio if I would have had bitcoin available to me... maybe I would have screwed it up, and I was ONLY able to appreciate bitcoin based on my own having had gone through life in the way that I did? perhaps? perhaps?
I played with uphold DCA calculator that has limited capability: I inputted 12 mo DCA 8k/mo during 2015 (it cannot accept variable amounts per mo for a bulk purchase).
Total amount spent 96K, total number of bitcoins 351.
If you do the same one year DCA later, for example 2017, using the same money (8k/mo), you get just 45btc, which is about 8 times less.
In 2020-9 BTC.
In 2021, you would have gotten "just" 2 BTC (175 times less than in 2015).
2022-4 BTC (better than 2021, but still about 90 time "worse" than 2015).
So, if you combine just those three years (2020-2022), you would have spent 288K buying 15BTC (19.2K/btc)
Of course, you don't get as much BTC with the same amount of dollars, and you have to invest more dollars now as compared to back then and you are also have less upside, but you also likely have less downside too. I doubt that bitcoin has a worse investment thesis now as compared to its investment thesis in late 2013... even though the upside is lower..
Are you trying to suggest that there is some other better place that a newbie should be investing these days? if so, where?
It seems to me that there are still pretty damned good abilities to continue to front-run institutions by investing in bitcoin.. especially after this last shaking out of a lot of institutions and rich people.. maybe not all of them have been shaken out, but there has been some pretty decent shakenings of some of the bigger players in recent times, so that seems to me to provide opportunties for normies to get into bitcoin sooner rather than later.. and also to continue to be able to front-run institutions, and we cannot roll back the clocks.. we have to deal with the situation that we are in rather than whining about "how cheap" bitcoin would have been if I would not have been in grade school in 2013 but instead I just am able to buy bitcoin now because I just got a job.. or whatever happens to be the current situation rather than whining about possible lost opportunties. All kinds of people have been complaining about "bitcoin used to be cheaper" blah blah blah.. and right now there seems to be a lot of fortune for those getting in and able to buy BTC below the 200 week moving average, which surely has not been very common in bitcoin's price history. In other words, deal with what is available right now rather than what could have been whine, whine, whine...
I made an example in a way that it easier to see what would happen if you use 1/10 (about 800/mo or about 10K, year-more of a middle class investor realm of possibilities).
In such case (1/10), you would have spent about $29K while DCAing in 2020-2022 and got 1.5BTC, which is not a significant number for being wealthy, unless it goes to $5 mil and inflation gets to 2% a year soon.
There's nothing wrong with that. Do what you can... if you are starting now or if you started in 2020 there would be different stories, and surely if there is a kind of building up of the bitcoin portfolio, then we can look again 5-10 or even 15-20 years down the road and compare what it is like to have bitcoin as compared to what it would haver been like to not have bitcoin, and it seems to me that the person who got into bitcoin sooner rather than later is going to be better off than the person who waits another 5 years or more before they decide to start to get into bitcoin or to reallocate into bitcoin or whatever. Where are the other places that you are going to invest if you happen to have an extra $10k per year that you are able to invest? Hopefully you are going to say bitcoin, and hopefully you are going to say that $200 per week DCAing is a good idea, even if there might be some other ways to structure such buying plan.. that might take 5 years with your hypothetical facts just to get $50k invested into BTC... which might not even get you 1 whole BTC in 5 years if you are starting now with investing $200 per week into bitcoin.
Conclusion: Bitcoin is just too big in market cap already...could do 10X, maybe even 30-50X (to be like gold).
Sure bitcoin is approaching the size of gold, and bitcoin is likely 1,000x better than gold, even if it could take 150 years to reach such price... and you are correct that bitcoin might only get a 10x to 50x price appreciation in the coming 10 to 20 years, and gosh, if I had been able to get a 10x to 50x price appreciation in my first 10 to 20 years of investing I would have been elated. I got around 5.5% per year on average.. so even getting a doubling would have been good. Bitcoin still seems like the best of investments.
Where else are you going to go with your extra cashflow ($800 per month/ $10k per year or whatever your available amount happens to be?)? And if you figure out what you are going to invest into, then how are you going to proceed forward with such investing? DCA, lump sum and/or buying on the dip and maybe some additional tactics, perhaps?
Going forward, it is likely that you would get low single digits btc/year EVEN if investing at a rate that is beyond typical middle class possibilities (in my example).
There's no reason to be greedy. Do what the fuck you can do, and bitcoin still seems to be the best of investments when considering both upside and downside possibilities. You are not really saying anything new.
It tends to take a long fucking time for investment portfolios to build, and each of us has to be careful not to screw things up too much, so if we end up having a relatively low level of return and we DCA into bitcoin over the coming 5-10 years and then we ONLY get another 5x to 10x off of our total investment, are we in a worse place than if we had not invested into bitcoin? Other opportunities might come up along the way too.
Let's say that we spend 10 years investing and for some reason we are ONLY able to average about $10k of investing per year, so after 10 years, we have ONLY been able to invest $100k and maybe we ONLY got 1 bitcoin or 1.5 bitcoin out of the deal.. how much is that investment going to be worth at that time, and then are there going to be other opportunities, and what if we spend 20 years investing, then where are we going to be?
None of us know the answers completely, but we try to do our best based on what we know right now and what is available to us right now, and if it it appears that we are ONLY able to invest around $10k per year for the coming years, then is investing in bitcoin amongst the best of places to be putting that value or is there somewhere else that we might want to consider putting it? If we start out with ONLY investing into bitcoin, then maybe at some point we will want to diversify, and what conditions will need to exist by the time that we diversify? If we are investing $10k per year, it might take us close to 5 years before the diversification issue even becomes a possible issue.
Surely, Musk can always buy a lot of btc.
Of course, rich people start out from a different place than normies who have a $10k per year budget. You want to have a budget that is BIGGER than your actual budget? Gotta deal with reality, and if there are ways to increase your income or to cut your expenses, then maybe you can increase your investment budget from $10k per year to $20k per year.
In my personal life, I had gone into debt for higher education, and surely the tradeoffs might be different for people who might be in their 20s and even how they might choose whether to go into higher education or if their might be other opportunities available. I cannot exactly say what I would have done if bitcoin had been available, maybe I would have gotten involved in some kind of a bitcoin related career rather than the path that I had been on, so a lot of things can change course forward, including expectations of income. There were times in my life where my income went way higher than I had expected it to go, so I had a lot of surplus income during those times, so sometimes people's situations can change in terms of their income versus their expenses.. and some of those are the results of choices that are going to be different for younger people as compared with older people, too... or even different for those folks who are newly entering the labor force versus folks who are already in the labor force for a while or those who are at or near the end of their desires to work in ways that they might have done when they were willing to do when they were younger.
In 10 years even 5-10 btc could be a fortune (if inflation cooperates), so members should play with numbers and see how they can get there depending on their current situation.
Sure someone who already has an investment portfolio of $200k or more may not mind putting $30k to $50k into bitcoin in order to buy (or front load to get) 2 or 3 BTC and then DCAing the remainder of the next 10 years in order to see if they are able to get their BTC holdings into the 5-10BTC range. Someone who is freshly starting out in bitcoin with a $10k per year investment budget might well not be able to accumulate more than 1 or 2 BTC in the coming 10 years.. but that still might be enough.
However, if bitcoin continues it's upward trajectory, buying "bulk" would always get you more btc than DCA, as shown in my examples above.
You never showed or established that buying in bulk is better than DCA or that it is even possible without changing hypotheticals.
yeah, if you suggest that you have $100k available now, or if you have $100k coming available over the next 10 years, you may or may not be ready, willing or able to use that $100k to buy right now.. in the case that you are wanting to lock in a kind of front loaded investment.
I am not totally against front-loading investments because I did some variation of front loading myself, but I doubt that frontloading is as practical as you seem to be making it out to be. Maybe you need to flesh out your hypothetical a bit better? If you are talking about someone who has $10k per year that is available for them to invest, then how are they going to bulk buy? We need more facts? Do they already have a $100k in cash? or what? If they have a $200k investment portfolio and they have absolutely no BTC, then are they going to reallocate that portfolio? How are they going to do it? right away and incur fees? or are they going to perform some kind of a DCA that is more realistic, but it could take a while to even get to 25%, if they were going to play towards the upper end of aggressiveness. You seem to want them to get something like 5 BTC to 10 BTC right now, which is going to cost $86,200 to $172,400 based on current BTC prices of $17,240.
You seem to be wanting to describe scenarios in which you just get everything that you want.. get your cake and eat it too, and you are not seeming to deal with the actual reality of people or even the reality of any hypothetical person that you have presented, including the person that you describe who happens to have $10k per year to invest...where is that person going to get $86,200 to $172,400 in order to front load his BTC investment with 5-10 BTC right now at today's prices rather than investing in BTC over the coming 10 years with something like DCA and perhaps having ways to increase his/her available investment amounts or whatever the case might be? Are you suggesting equity loans to get money? or what? You have not made the case that front loading is better than DCA, even based on the various hypotheticals that you presented so far.
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