JJG's Bitcoin Investment Ideas (Sustainable Withdrawal / Portfolio Maintenance)

[Tungbulu]

✂️✂️✂️

Even though everything that you are saying comes off as mostly correct, it also comes off as a bit theoretical if you cannot elaborate on what you mean a bit better, perhaps with the use of some examples or something like that.

Okay let's try looking at a hypothetical scenario of a successful entrepreneur who has over the years, built quite a sizable amount of Bitcoin, and as the years goes by, her Holdings have significantly grown and have reached a state of overaccumulation, and now worth around $10 million.

Now the entrepreneur's focus shifts from building more wealth and stacking up more funds to managing his existing portfolio and optimizing his financial position. He's determined to maintain his desired lifestyle, render financial support to his family and still ensure his financial stability.
So to achieve this goal, he decides to implement a time based strategic withdrawal approach by selling only 2% of his Bitcoin holdings quarterly, and by doing this, it allows the entrepreneur to generate a steady income stream while also simultaneously minimizing tax implications.

And even in times when the market starts experiencing a sudden decline and the price of Bitcoin drops by 30%, as many investors begins to panic and selling off their Bitcoins, the entrepreneur keeps his cool and sticks to selling only the predetermined amount of Bitcoin according to his plan earlier and thereby, ignoring the  short term market fluctuations, but rather interested in achieving his long-term financial goals.
And by prioritizing his financial stability, by managing tax implications and maintaining his planned allocation, he's able to optimize his financial position, while simultaneously minimizing and mitigating unnecessary risks. His strategic bitcoin withdrawal strategy enables him to achieve his specific objectives and also ensuring that he's more prepared for the future.

[JayJuanGee]

✂️✂️✂️

Even though everything that you are saying comes off as mostly correct, it also comes off as a bit theoretical if you cannot elaborate on what you mean a bit better, perhaps with the use of some examples or something like that.

Okay let's try looking at a hypothetical scenario of a successful entrepreneur who has over the years, built quite a sizable amount of Bitcoin, and as the years goes by, her Holdings have significantly grown and have reached a state of overaccumulation, and now worth around $10 million.

If you are referring to current spot prices then we are talking about 92.6 bitcoin.

Now the entrepreneur's focus shifts from building more wealth and stacking up more funds to managing his existing portfolio and optimizing his financial position.

Ok... so you are proclaiming that this hypothetical guy has come to a conclusion that he largely has enough bitcoin, so he does not necessarily need to continue to spend time accumulating bitcoin to the extent that you might be suggesting that up until now he had been accumulating bitcoin.

I would find it helpful to know how he got to such 92.6-ish BTC status and other parts about his personal factors - besides merely that he is changing his mindset in regards to how he thinks about his bitcoin, since I would have had considered that a guy does not just come to 92.6 BTC, and his mindset likely had already been changing little by little through the years.. and golly-gee whiz, there are quite a few different paths that the guy could have had taken to get to such 92.6 BTC, which many times would be relevant.. even though surely the mere fact that he has 92.6 BTC does remain relevant in and of itself too, so I will grant you the relevancy of that part.

He's determined to maintain his desired lifestyle, render financial support to his family and still ensure his financial stability.
So to achieve this goal, he decides to implement a time based strategic withdrawal approach by selling only 2% of his Bitcoin holdings quarterly, and by doing this, it allows the entrepreneur to generate a steady income stream while also simultaneously minimizing tax implications.

I don't have any problem with the idea of selling 2% of the BTC quarterly or even 8% annually based on the quantity of BTC, and previously, I had considered BTC management in those kinds of terms that would withdraw that BTC at those kinds of rates, yet in recent times, I have considered using the 200-WMA to value the coins and then to withdraw based on similar ideas but using the dollar value in order to attempt to get to a more solid (and stable) results, even though surely a guy could also upwardly adjust the dollar amount each year in order to account for the potential debasement of the dollar or the lessening of the purchasing power of the dollar each year.  In recent times, I had just been using a 7% per year presumed debasement of the dollar (or interest rates) for round about convenience in regards to what might be a fair estimate regarding how much the dollar might be going down in value on a yearly basis.  

My own sustainable withdrawal webpages and sustainable withdrawal tool has not really accounted for some of my current thinking on the matter that involves pegging to dollar value rather than pegging to quantity of BTC, even though there is enough information in the generated data that come from my sustainable withdrawal tool that these kinds of steady and reasonable dollar-based withdrawal formulas can be figured out.. and to sure that they are sustainable.

Of course, we don't exactly need any tool to figure out how much 2% per quarter withdrawal rate would be since we just look at the BTC quantity and we can project the balance of BTC that will be remaining each quarter after we sell 2% of our stash each quarter, so the first quarter we would sell right around 1.85 BTC, which would be right around $200k.. and which would be the withdrawal of $800k per year.

Based on the use of the 200-WMA, currently I am showing a yearly sustainable withdrawal rate of right around a $458k rate for a current stash of 92.6 BTC.

I consider that either rate would be sustainable, even though you are calculating a bitcoin amount to withdraw which is likely going to contribute to a lot of variance in the dollar value, and I am considering starting with a dollar value and presuming that each year I will be able to increase it by at least 7%, if I want... and any excess appreciation of the value will continue to compound.. unless I adjust my withdrawal rate from time to time to account for my new valuations...and personally, I don't consider the possibility of annual-ish re-evaluations to be particularly problematic or burdensome, and sure even your goal of withdrawing 2% of the BTC per quarter would not be burdensome to adjust from time to time, whether annually or otherwise.

And even in times when the market starts experiencing a sudden decline and the price of Bitcoin drops by 30%, as many investors begins to panic and selling off their Bitcoins, the entrepreneur keeps his cool and sticks to selling only the predetermined amount of Bitcoin according to his plan earlier and thereby, ignoring the  short term market fluctuations,

Sure.  that is possible that guy currently with 92.6 bitcoin and a 2% per quarter withdrawal rate is going to be able to deal with the fluctuations and to just withdraw his 2% no matter the bitcoin price, so even if the BTC price goes down 80% as it has historically done, your guy would still be able to withdraw his 2% even though it ONLY retains 20%-ish of today's value.. not that either of us consider an 80% draw down from today's price to be very realistic, and perhaps slightly more than a 50% draw down from our current prices, might be more within an area of potential drawdown that coudl end up happening, even though we may also have more up before down, even though we likely do have to prepare financially and mentally for either direction.

I think that my guy who would be withdrawing based on the 200-WMA would likely go through less variation, even though i do start to reduce the withdrawal rate once the BTC price goes below 25% higher than the 200-WMA.. so currently, if the BTC price were to go below $62k-ish, then my system would start to recommend reductions in the monthly withdrawal amount... For my system, a $458k annual withdrawal amount is $38k per month when it is just following the standard withdrawals and not withdrawing extras on booms or reducing on BTC spot price corrections that go below 25% above the 200-WMA.... and right now the BTC price is right around 120% higher than the 200-WMA.

but rather interested in achieving his long-term financial goals.

What are his long-term financial goals?  just to continue to live off of his bitcoin.. whether withdrawing a steady bitcoin rate or perhaps withdrawing based on a dollar rate and continuing allowing it to grow and compound upon itself as long as the withdrawal rate is not too high.

Don't get me wrong, since I think that even withdrawing on bitcoin percentage is o.k... yet I become a bit bothered by the likely extreme changes if the income is purely based on a straight bitcoin withdrawal rate since I think that it is going to fluctuate quite a bit in terms of dollar value that is being withdrawn.

And by prioritizing his financial stability, by managing tax implications and maintaining his planned allocation, he's able to optimize his financial position, while simultaneously minimizing and mitigating unnecessary risks. His strategic bitcoin withdrawal strategy enables him to achieve his specific objectives and also ensuring that he's more prepared for the future.

I don't have any problems with any of those goals, even though I consider that it would be more stable to withdraw at some rate that is lower than a strict bitcoin amount, even though I do have some funds in two of my bitcoin accounts that have been being withdrawn at a steady rate since about early 2023, even though their value went up more than 4x since then.. but I have continued to allow them to be withdrawn at the same BTC rate.. and perhaps part of the reason that I had been allowing such is based on my having had used a 4% annualized withdrawal rate, even though I know that a 10% annualized withdraw rate would likely also be sustainable.. so even though I had not been reducing the allowance based on dollars, I had been ONLY allowing less than half of the amount that I consider to be sustainable. which also just means that the remaining (not withdrawn) value continues to compound upon itself for the possibility of higher future withdrawals if needed or even not needing to reduce the withdrawal rate, even if the BTC price were to go down 50% from here or maybe even 80% at some future time.

[Tungbulu]

Ok... so you are proclaiming that this hypothetical guy has come to a conclusion that he largely has enough bitcoin, so he does not necessarily need to continue to spend time accumulating bitcoin to the extent that you might be suggesting that up until now he had been accumulating bitcoin.

I would find it helpful to know how he got to such 92.6-ish BTC status and other parts about his personal factors - besides merely that he is changing his mindset in regards to how he thinks about his bitcoin, since I would have had considered that a guy does not just come to 92.6 BTC, and his mindset likely had already been changing little by little through the years.. and golly-gee whiz, there are quite a few different paths that the guy could have had taken to get to such 92.6 BTC, which many times would be relevant.. even though surely the mere fact that he  92.6 BTC does remain relevant in and of itself too, so I will grant you the relevancy of that part.

Well, I guess we could say that the entrepreneur's journey to accumulating over 92.6 BTC may have actually involved a variety of factors like, early adoption, of course consistent accumulation, strategic purchases like taking advantage of potential DIPs and other strategic approaches. The entrepreneur's personal factor may have likely included a very strong risk tolerance, financial discipline and a very deep knowledge of the market.

He may have eventually developed a long term perspective overtime, putting his focus more on the potential for Bitcoin's long term growth and adoption. And the more his portfolio grew, he had a shift in mindset from further accumulation to strategic wealth management, he began making financial stability a top priority as well as tax efficiency. Yeah, this mindset shift likely occured gradually as he advanced and gained more experience and confidence in his investment strategy and approach. This mindset shift I believe is a natural progression for those investors who have managed to achieve a significant position in cryptocurrency market.

The entrepreneur's decision to engage in a time based strategic withdrawal by selling 2% of his Bitcoin holdings quarterly shows just how committed he is to maintaining financial stability while also minimizing tax implications.

And by prioritizing his financial stability, by managing tax implications and maintaining his planned allocation, he's able to optimize his financial position, while simultaneously minimizing and mitigating unnecessary risks. His strategic bitcoin withdrawal strategy enables him to achieve his specific objectives and also ensuring that he's more prepared for the future.

I don't have any problems with any of those goals, even though I consider that it would be more stable to withdraw at some rate that is lower than a strict bitcoin amount, even though I do have some funds in two of my bitcoin accounts that have been being withdrawn at a steady rate since about early 2023, even though their value went up more than 4x since then.. but I have continued to allow them to be withdrawn at the same BTC rate.. and perhaps part of the reason that I had been allowing such is based on my having had used a 4% annualized withdrawal rate, even though I know that a 10% annualized withdraw rate would likely also be sustainable.. so even though I had not been reducing the allowance based on dollars, I had been ONLY allowing less than half of the amount that I consider to be sustainable. which also just means that the remaining (not withdrawn) value continues to compound upon itself for the possibility of higher future withdrawals if needed or even not needing to reduce the withdrawal rate, even if the BTC price were to go down 50% from here or maybe even 80% at some future time.

Your withdrawal approach is indeed thoughtful and strategic I must say. By withdrawing a fixed amount from your stash, you've allowed your withdrawal value the chance to increase as the price of Bitcoin rises. This approach provides a growing income stream, but that also means that if there's a decline in Bitcoin price, the value of your withdrawal may also drastically decrease over time.

Using a withdrawal rate, such as withdrawing 4% annualized can actually help to ensure that your holdings last over the long term.  Your approach have been quite conservative by allowing less than half of what you've considered to be sustainable, as it can help to provide some kind of buffer against potential downturns in the market.

[JayJuanGee]

Ok... so you are proclaiming that this hypothetical guy has come to a conclusion that he largely has enough bitcoin, so he does not necessarily need to continue to spend time accumulating bitcoin to the extent that you might be suggesting that up until now he had been accumulating bitcoin.

I would find it helpful to know how he got to such 92.6-ish BTC status and other parts about his personal factors - besides merely that he is changing his mindset in regards to how he thinks about his bitcoin, since I would have had considered that a guy does not just come to 92.6 BTC, and his mindset likely had already been changing little by little through the years.. and golly-gee whiz, there are quite a few different paths that the guy could have had taken to get to such 92.6 BTC, which many times would be relevant.. even though surely the mere fact that he  92.6 BTC does remain relevant in and of itself too, so I will grant you the relevancy of that part.

Well, I guess we could say that the entrepreneur's journey to accumulating over 92.6 BTC may have actually involved a variety of factors like, early adoption, of course consistent accumulation, strategic purchases like taking advantage of potential DIPs and other strategic approaches. The entrepreneur's personal factor may have likely included a very strong risk tolerance, financial discipline and a very deep knowledge of the market.

He may have eventually developed a long term perspective overtime, putting his focus more on the potential for Bitcoin's long term growth and adoption. And the more his portfolio grew, he had a shift in mindset from further accumulation to strategic wealth management, he began making financial stability a top priority as well as tax efficiency. Yeah, this mindset shift likely occured gradually as he advanced and gained more experience and confidence in his investment strategy and approach. This mindset shift I believe is a natural progression for those investors who have managed to achieve a significant position in cryptocurrency market.

The entrepreneur's decision to engage in a time based strategic withdrawal by selling 2% of his Bitcoin holdings quarterly shows just how committed he is to maintaining financial stability while also minimizing tax implications.

Sure, it is possible that such bitcoin accumulator HODLer could have had developed those various characteristics, yet I still get the sense that you are imagining a lot about mindset.. and surely I would have had thought that it might be more concrete to focus on various ways that such a guy might have had gotten to such a level.. and you don't even really proclaim a timeset in which such a guy might have had gotten to such a stage.

Perhaps we can attempt to imagine a guy who started in bitcoin in mid 2014.... and so maybe we are imagining a guy who ONLY bought bitcoin but never sold any (except maybe spend and replace), so then that would be an investment timeline of 11 years... Sure , 9 or 10 years could also work, but if we reduce the timeline, then it might cause difficulties to achieve 92.6 BTC - especially for somewhat normal people... yet as I tried to suggest I still find the amount accumulated to be quite a bit and also your assumption about the guy just all of sudden getting to 92.6 BTC seems a bit of a fantasy too, even though surely I can imagine some scenarios in which such a thing might have had happened.

Even though I am cooperating with you, I am still a bit frustrated to feel that I need to give some examples in order to potentially describe some ways in which a guy might get to that 92.6 BTC amount and ONLY now start to consider transitioning into some kind of a sustainable withdrawal status... and I also believe that you could have had come up with some kind of a vision of a guy that is more specific about what he did, what were his financial limitations and perhaps considering some goals that he might have had from the start.. so then sure, we might see the various ways that bitcoin might have had changed him, but still it seems more plausible to put it into a framework of specific acts rather than retaining vagueries within a description of how he feels about his having had gotten to 92.6 BTC.

My assumption is going to be that each of the hypothetical guys had an income of somewhere in the ballpark of $100k per year, and perhaps a goal to get to a status in which he would be able to withdraw $200k per year with a kind of passive income.  I will warn in advance that I think that none of these work, because from my own point of view even in the most conservative of scenarios the guy stocked up way too many BTC in terms of his stated goals, and even a guy with a $100k per year income seems a bit unrealistic in terms of attempting to appeal to normal people.. .. but anyhow, I am trying to work with your example to the extent that you have provided any details, I am just getting that he has $10 million spot price bitcoin right now... so then what to do about it, might relate to how he got to such a point and what his original goals might have had been.. and were such goals realistic?.. or maybe a more plausible rationale is that he lost track of how many bitcoin he had, but that hardly makes sense, either... but let me see what I can do to attempt to work with what you have provided, so far.

Maybe also we can say that the guy is about mid-30s when he heard about bitcoin, so he had perhaps been investing in various traditional investments for 10 years, and so he had invested about one whole year of his income and perhaps there were matching funds and various kinds of price appreciation, so perhaps his total investment portfolio is around $200k at the time he gets started in bitcoin  (we are talking mid 2014).

Hypothetical 1 (we will refer to him as a front loader).. So he may well buy his BTC in various chunks until he gets to 92.6... and since he is a front loader, he may well be taking from other parts of his investment portfolio and/or combining that with his income.. so maybe he invests around $15k the first couple of times and $8k the third time.. looking something like this.

Buy 1 - $15k June 2014 - $600 per BTC - 25 BTC
Buy 2 - $15k November 2014 - $380 per BTC - 40 BTC
Buy 3 - $8k October 2015 - $280 per BTC - 27.6 BTC

Total invested $38k

Hypothetical 2 (we will refer to him as the DCAer).. So he just started buying BTC at about $221 per week, and over the past 11 years he may well have had invested $125k into bitcoin.
 
Of course, there can be several variants in between, yet I still have trouble understanding how either of these guys would just start to feel that they need to enter into the withdrawal stage of their investment into bitcoin.

Perhaps a more plausible version might have had been someone who might have already realized that he could start withdrawing, so he started withdrawing a while back, since if a guy wanted to withdraw at $200k per year, then under traditional valuations, his holdings would have had needed to get to right around $5 million, and if the guy had 92.6 BTC, then his BTC spot price holdings would have had crossed over such valuation at around $54k, and we crossed over $54k a couple times in 2021 and got stuck around there for a good amount of time in 2024, and so now we are double that $54k price, and surely that is part of my own reluctance to want to be using spot prices in order to figure out valuation, yet  even the guy could have had started some kind of a 4% per year withdrawal rate in early 2021, and he would still have right around 77.3 bitcoin right now, and over the past 4.5-ish years, he would have had cashed out right around $730k .

And, yeah, I know that I am changing aspects of your facts, but even a guy with 77.3 BTC currently would have a 200-WMA value of right around $3.8 million and a spot price valuation of $8.4 million, so I would consider that based on the 200-WMA valuation that he would be able to sustainably withdraw right around $380k per year. So even this guy who already started withdrawing 4.5 years ago would have had still retained much of the value of his holdings if he had merely withdrew at the traditional withdrawal rate of 4% and I personally think that if we use the 200-WMA and we price the withdrawals in dollars, then we could sustainably withdraw 10% of the 200-WMA value of the holdings, so long as the BTC spot price were to stay at least 25% higher than the 200-WMA.

Hopefully I have beat up upon some of these ideas enough, even though I continue to think that you, Tungbulu, could have had provided some kind of a better semblance of your own ideas, so that it might be more concrete what you are talking about rather than just vaguely referring to a guy suddenly having 92.6 BTC..,. even though for sure if the guy started early enough, such as 11 years ago, then there could be a variety of scenarios to get to 92.6 BTC...and the shorter we make the timeline, thent it might hav had been more difficult to get to such quantity of BTC absent perhaps some heavier front-loading and/or some various buying on dips, not expecting that the guy necessarily hit the bottom within his various BTC buys on dips, even  though there could be some realistic ways to combine buying on the dip and regular DCA, and to still have relatively short timelines that might even be less than 2 cycles. (2 cycles putting us back to a mid-2017 starting timeline).

And by prioritizing his financial stability, by managing tax implications and maintaining his planned allocation, he's able to optimize his financial position, while simultaneously minimizing and mitigating unnecessary risks. His strategic bitcoin withdrawal strategy enables him to achieve his specific objectives and also ensuring that he's more prepared for the future.

I don't have any problems with any of those goals, even though I consider that it would be more stable to withdraw at some rate that is lower than a strict bitcoin amount, even though I do have some funds in two of my bitcoin accounts that have been being withdrawn at a steady rate since about early 2023, even though their value went up more than 4x since then.. but I have continued to allow them to be withdrawn at the same BTC rate.. and perhaps part of the reason that I had been allowing such is based on my having had used a 4% annualized withdrawal rate, even though I know that a 10% annualized withdraw rate would likely also be sustainable.. so even though I had not been reducing the allowance based on dollars, I had been ONLY allowing less than half of the amount that I consider to be sustainable. which also just means that the remaining (not withdrawn) value continues to compound upon itself for the possibility of higher future withdrawals if needed or even not needing to reduce the withdrawal rate, even if the BTC price were to go down 50% from here or maybe even 80% at some future time.

Your withdrawal approach is indeed thoughtful and strategic I must say. By withdrawing a fixed amount from your stash, you've allowed your withdrawal value the chance to increase as the price of Bitcoin rises. This approach provides a growing income stream, but that also means that if there's a decline in Bitcoin price, the value of your withdrawal may also drastically decrease over time.

Using a withdrawal rate, such as withdrawing 4% annualized can actually help to ensure that your holdings last over the long term.  Your approach have been quite conservative by allowing less than half of what you've considered to be sustainable, as it can help to provide some kind of buffer against potential downturns in the market.

In the last several years, I have been gravitating towards higher than 4% withdrawal rates so long as the valuation of the holdings are based on the 200-WMA and the authorized withdrawal amounts are pegged to dollar valuations...  For probably more than 4 years, I was already presuming that guys should be able to withdraw greater than 4%, even gravitating up to 6-10%, and when Bitmover put the back tester in the tool (about a year and a half ago - here is the thread on the topic of creating the tool), I was able to see that even maximizing the rates (which it ONLY goes up to 30%) would still allow for long term growth in the value of the holdings in terms of dollars - yet I also started to think that it was too risky to peg the amounts to BTC amounts and also to go so high with the withdrawal rate when it likely was not needed and would end up overly depleting the BTC holdings, since many of us likely recognize and appreciate that bitcoin is likely the best of places to hold value, so why would any of us want to be motivated to overlydeplete our bitcoin holdings (and draw down principle of our bitcoin holdings) unless we were to have some major health event or perhaps based on our age (and no desires to pass wealth down to heirs).

Of course, there likely remains to be value to spend from other income sources prior to spending from bitcoin, or alternatively to withdraw at fairly conservative rates in order to make sure not to overly deplete the bitcoin holdings, even though surely it seems to be the case that bitcoin tends to grow much faster and better than other assets and bitcoin can even tolerate higher withdraw rates and still to be sustainable, so surely, I don't mind some level of creative aggressive withdrawal in terms of still maintaining some frameworks to try to make sure that withdrawals are not being done in ways that overly deplete the bitcoin holdings, and it still seems to me that we ongoingly witness examples of guys having regrets because they end up selling way too much bitcoin too soon.

Ultimately, even if I am attempting to share some kinds of frameworks in which guys can consider their bitcoin withdrawals once they reach overaccumulation status, there still seem to be guys prematurely concluding that they reached overaccumulation status., yet maybe even in those cases if guys might start to practice some kind of sustainable BTC withdrawal, then he can figure out some kinds of boundaries to reassess from time to time, and surely I am way more convinced that valuating based on the 200-WMA (bottom price valuations - and conservative valuations) will likely lead to more stable levels of withdrawal, even though at the same time, it seems that my suggestion that a 10% withdrawal rate may well seem high to some guys and also may well end up being a high rate if guys are withdrawing 10% of their BTC rather than 10% of their 200-WMA dollar valuation and perhaps even leaving some kind of an extra cushion in there so that the withdrawals do not end up being excessive..

[Solodoski]

In the last several years, I have been gravitating towards higher than 4% withdrawal rates so long as the valuation of the holdings are based on the 200-WMA and the authorized withdrawal amounts are pegged to dollar valuations...  For probably more than 4 years, I was already presuming that guys should be able to withdraw greater than 4%, even gravitating up to 6-10%, and when Bitmover put the back tester in the tool (about a year and a half ago - here is the thread on the topic of creating the tool), I was able to see that even maximizing the rates (which it ONLY goes up to 30%) would still allow for long term growth in the value of the holdings in terms of dollars - yet I also started to think that it was too risky to peg the amounts to BTC amounts and also to go so high with the withdrawal rate when it likely was not needed and would end up overly depleting the BTC holdings, since many of us likely recognize and appreciate that bitcoin is likely the best of places to hold value, so why would any of us want to be motivated to overlydeplete our bitcoin holdings (and draw down principle of our bitcoin holdings) unless we were to have some major health event or perhaps based on our age (and no desires to pass wealth down to heirs).

Of course, there likely remains to be value to spend from other income sources prior to spending from bitcoin, or alternatively to withdraw at fairly conservative rates in order to make sure not to overly deplete the bitcoin holdings, even though surely it seems to be the case that bitcoin tends to grow much faster and better than other assets and bitcoin can even tolerate higher withdraw rates and still to be sustainable, so surely, I don't mind some level of creative aggressive withdrawal in terms of still maintaining some frameworks to try to make sure that withdrawals are not being done in ways that overly deplete the bitcoin holdings, and it still seems to me that we ongoingly witness examples of guys having regrets because they end up selling way too much bitcoin too soon.

Ultimately, even if I am attempting to share some kinds of frameworks in which guys can consider their bitcoin withdrawals once they reach overaccumulation status, there still seem to be guys prematurely concluding that they reached overaccumulation status., yet maybe even in those cases if guys might start to practice some kind of sustainable BTC withdrawal, then he can figure out some kinds of boundaries to reassess from time to time, and surely I am way more convinced that valuating based on the 200-WMA (bottom price valuations - and conservative valuations) will likely lead to more stable levels of withdrawal, even though at the same time, it seems that my suggestion that a 10% withdrawal rate may well seem high to some guys and also may well end up being a high rate if guys are withdrawing 10% of their BTC rather than 10% of their 200-WMA dollar valuation and perhaps even leaving some kind of an extra cushion in there so that the withdrawals do not end up being excessive..

This is a well though-out point of view, very relatable too. I am very much interested in the idea of bench-marking against 200-WMA instead of relying on the illusions of spot price unrealistic expectations. Basically, I sometimes wonder how many of us are ready psychologically to discipline ourselves on how much bitcoin we withdraw, even if we set clear limits like 6% to 10% a year. I mean, sure, it seems so easy to say, I can only withdraw 10% of my 200-WMA valuation every year, but once the kicks in and the price goes up 2x or more above the MA line, most of us wont overcome the temptation, especially for investors who dont really know why they set those limits in the first place.

Also, the issue of over-accumlation (that sis people thinking they have accumulated enough bitcoin too soon) just like you said earlier on, it happens frequently. They have barely gone through one cycle, maybe two or three as the case maybe, and then they suddenly shift from accumulating to draining. It leaves no other thought, than the conclusion that their goals are too shorts or they misunderstood just how long and profiting the journey can be. And I agree, immediately an investor starts tapping into his stack (which is not advisable) without setting boundaries or realizing himself, everything might wipe out in a twinkle of an eye. From little fractions to nothing in their portfolio. Seen it too many times, trust me.

If anything, what interest me the most about your method is that it allows investors to accumulate, withdraw, at the right time, without getting too overwhelmed about the whole thing.

[JayJuanGee]

In the last several years, I have been gravitating towards higher than 4% withdrawal rates so long as the valuation of the holdings are based on the 200-WMA and the authorized withdrawal amounts are pegged to dollar valuations...  For probably more than 4 years, I was already presuming that guys should be able to withdraw greater than 4%, even gravitating up to 6-10%, and when Bitmover put the back tester in the tool (about a year and a half ago - here is the thread on the topic of creating the tool), I was able to see that even maximizing the rates (which it ONLY goes up to 30%) would still allow for long term growth in the value of the holdings in terms of dollars - yet I also started to think that it was too risky to peg the amounts to BTC amounts and also to go so high with the withdrawal rate when it likely was not needed and would end up overly depleting the BTC holdings, since many of us likely recognize and appreciate that bitcoin is likely the best of places to hold value, so why would any of us want to be motivated to overlydeplete our bitcoin holdings (and draw down principle of our bitcoin holdings) unless we were to have some major health event or perhaps based on our age (and no desires to pass wealth down to heirs).

Of course, there likely remains to be value to spend from other income sources prior to spending from bitcoin, or alternatively to withdraw at fairly conservative rates in order to make sure not to overly deplete the bitcoin holdings, even though surely it seems to be the case that bitcoin tends to grow much faster and better than other assets and bitcoin can even tolerate higher withdraw rates and still to be sustainable, so surely, I don't mind some level of creative aggressive withdrawal in terms of still maintaining some frameworks to try to make sure that withdrawals are not being done in ways that overly deplete the bitcoin holdings, and it still seems to me that we ongoingly witness examples of guys having regrets because they end up selling way too much bitcoin too soon.

Ultimately, even if I am attempting to share some kinds of frameworks in which guys can consider their bitcoin withdrawals once they reach overaccumulation status, there still seem to be guys prematurely concluding that they reached overaccumulation status., yet maybe even in those cases if guys might start to practice some kind of sustainable BTC withdrawal, then he can figure out some kinds of boundaries to reassess from time to time, and surely I am way more convinced that valuating based on the 200-WMA (bottom price valuations - and conservative valuations) will likely lead to more stable levels of withdrawal, even though at the same time, it seems that my suggestion that a 10% withdrawal rate may well seem high to some guys and also may well end up being a high rate if guys are withdrawing 10% of their BTC rather than 10% of their 200-WMA dollar valuation and perhaps even leaving some kind of an extra cushion in there so that the withdrawals do not end up being excessive..

This is a well though-out point of view, very relatable too. I am very much interested in the idea of bench-marking against 200-WMA instead of relying on the illusions of spot price unrealistic expectations. Basically, I sometimes wonder how many of us are ready psychologically to discipline ourselves on how much bitcoin we withdraw, even if we set clear limits like 6% to 10% a year. I mean, sure, it seems so easy to say, I can only withdraw 10% of my 200-WMA valuation every year, but once the kicks in and the price goes up 2x or more above the MA line, most of us wont overcome the temptation, especially for investors who dont really know why they set those limits in the first place.

You might be underestimating the discipline that guys can create for themselves - especially if they might have already come to bitcoin with a decently long investment timeline, and they are finding bitcoin to outperform their expectations.. especially if they are able to valuate their bitcoin using  conservative standards.. which also ends up helping them to see that they don't necessarily get to an overaccumulation status so easily.. yet once they get there, they likely are able to live off their bitcoin stash in sustainable ways and even to see that their bitcoin investment is tending to outgrow their withdrawal rate by so much that they are likely able to increase their withdrawal rate with the passage of time, even beyond a 7% per year growth rate (or expected debasement of the dollar rate).

 

Also, the issue of over-accumlation (that sis people thinking they have accumulated enough bitcoin too soon) just like you said earlier on, it happens frequently. They have barely gone through one cycle, maybe two or three as the case maybe, and then they suddenly shift from accumulating to draining. It leaves no other thought, than the conclusion that their goals are too shorts or they misunderstood just how long and profiting the journey can be.

Part of my motivation for creating this thread is to help to give guys some tools so that that they can figure out some reasonable sustainable withdrawal rate.  Ultimately they are responsible for their own decisions and if they fuck up because they are withdrawing too much BTC too fast, then they may well be doing something wrong, like you suggested, and perhaps instead of starting out with a 6-10% withdrawal rate, as I consider to be reasonably achievable, they can start out with a more conservative rate, such as 4% and then see how that plays out for a year or two, and then perhaps consider if they can increase their withdrawal rate at a later date, in the event they might be able to reasonably conclude that their BTC stash is greatly outgrowing their withdrawal rate, even if they are measuring their valuation from the 200-WMA and using the dollar equivalent of their 200-WMA valuation.. so in the end, many of us already know that historically, the BTC spot price has tended quite a bit of its time at least 25% higher than the 200-WMA, yet if we are able to adjust are withdrawal rate down during periods in which the BTC price is less than 25% higher than the 200-WMA.. then we are also likely going to experience considerable growth in our BTC, especially further out in time, and surely the greater that our bitcoin grows in value, then the more likely that our withdrawal rate is going to be more than sufficient for our needs and our wants.  The historical data seems to bear it out, and bitcoins investment thesis does not seem to be getting weaker, even though there are no guarantees in regards to its future performance, so we just need to figure out ways to do our best in terms of finding ways to reasonably figure out if we are still in our accumulation stages or if we truly have reached overaccumulation status so that it starts to make sense to start to employ price based and/or time based sustainable withdrawal practices.

 

And I agree, immediately an investor starts tapping into his stack (which is not advisable) without setting boundaries or realizing himself, everything might wipe out in a twinkle of an eye. From little fractions to nothing in their portfolio. Seen it too many times, trust me.

If anything, what interest me the most about your method is that it allows investors to accumulate, withdraw, at the right time, without getting too overwhelmed about the whole thing.

Surely there is a bit of a punchline that we truly should not be assessing ourselves as having had reached overaccumulation status when we have not, so if we end up screwing up those kinds of matters because we miscalculated, then that is on us... and surely there can be value in erroring on the side of more conservative practices.. even though I believe that when any of us get to overaccumulation status, there are a lot of optiions and quite a bit of flexibility to figure out ways to either wait for some time or to start withdrawing in ways that are not depleting our principle.

[Loyang]

And by prioritizing his financial stability, by managing tax implications and maintaining his planned allocation, he's able to optimize his financial position, while simultaneously minimizing and mitigating unnecessary risks. His strategic bitcoin withdrawal strategy enables him to achieve his specific objectives and also ensuring that he's more prepared for the future.

I don't have any problems with any of those goals, even though I consider that it would be more stable to withdraw at some rate that is lower than a strict bitcoin amount, even though I do have some funds in two of my bitcoin accounts that have been being withdrawn at a steady rate since about early 2023, even though their value went up more than 4x since then.. but I have continued to allow them to be withdrawn at the same BTC rate.. and perhaps part of the reason that I had been allowing such is based on my having had used a 4% annualized withdrawal rate, even though I know that a 10% annualized withdraw rate would likely also be sustainable.. so even though I had not been reducing the allowance based on dollars, I had been ONLY allowing less than half of the amount that I consider to be sustainable. which also just means that the remaining (not withdrawn) value continues to compound upon itself for the possibility of higher future withdrawals if needed or even not needing to reduce the withdrawal rate, even if the BTC price were to go down 50% from here or maybe even 80% at some future time.

Your withdrawal approach is indeed thoughtful and strategic I must say. By withdrawing a fixed amount from your stash, you've allowed your withdrawal value the chance to increase as the price of Bitcoin rises. This approach provides a growing income stream, but that also means that if there's a decline in Bitcoin price, the value of your withdrawal may also drastically decrease over time.

Using a withdrawal rate, such as withdrawing 4% annualized can actually help to ensure that your holdings last over the long term.  Your approach have been quite conservative by allowing less than half of what you've considered to be sustainable, as it can help to provide some kind of buffer against potential downturns in the market.

There are two sides to this. As you said, when the price of Bitcoin falls during a market downturn, the value of the withdrawal will decrease a lot. If you see that the market is going to fall, then do not withdraw the investment, take some time and withdraw when the market returns to its previous condition. You have an emergency fund to deal with emergencies. So I think you can wait for a few days. The Bitcoin market is very volatile, you can never tell when what will happen. So this issue cannot be said.

But yes, the issue that JJ sir has raised is really a very beautiful process among us. It would be very good for all those who have reached the excess savings level to adopt this method.

[Finebone]

. If you see that the market is going to fall, then do not withdraw the investment, take some time and withdraw when the market returns to its previous condition. You have an emergency fund to deal with emergencies. So I think you can wait for a few days.

If you are taking profit from your bitcoin investment from the place of lack as you are making it looks like now, that means you are not making the best decision, regardless of if you are in your over accumulation status or not.
Your emergency funds is always available to safeguard your Bitcoin investment, so if it's because of lack of finance that is making you want to withdraw your holdings, then your decide to withdraw some of it, that means you are wrong, you should be taking profits from your bitcoin investment when you have gotten to that over accumulation status from the place of abundance, or just wanting to taste how it feels, not because a condition is forcing you to do so, because if it's because of a terrible financial situation, you may sell more than you planned or you may sell everything and become a no coiner overnight, since you are selling from a place of lack, not from a place of abundance.

[JayJuanGee]

And by prioritizing his financial stability, by managing tax implications and maintaining his planned allocation, he's able to optimize his financial position, while simultaneously minimizing and mitigating unnecessary risks. His strategic bitcoin withdrawal strategy enables him to achieve his specific objectives and also ensuring that he's more prepared for the future.

I don't have any problems with any of those goals, even though I consider that it would be more stable to withdraw at some rate that is lower than a strict bitcoin amount, even though I do have some funds in two of my bitcoin accounts that have been being withdrawn at a steady rate since about early 2023, even though their value went up more than 4x since then.. but I have continued to allow them to be withdrawn at the same BTC rate.. and perhaps part of the reason that I had been allowing such is based on my having had used a 4% annualized withdrawal rate, even though I know that a 10% annualized withdraw rate would likely also be sustainable.. so even though I had not been reducing the allowance based on dollars, I had been ONLY allowing less than half of the amount that I consider to be sustainable. which also just means that the remaining (not withdrawn) value continues to compound upon itself for the possibility of higher future withdrawals if needed or even not needing to reduce the withdrawal rate, even if the BTC price were to go down 50% from here or maybe even 80% at some future time.

Your withdrawal approach is indeed thoughtful and strategic I must say. By withdrawing a fixed amount from your stash, you've allowed your withdrawal value the chance to increase as the price of Bitcoin rises. This approach provides a growing income stream, but that also means that if there's a decline in Bitcoin price, the value of your withdrawal may also drastically decrease over time.

Using a withdrawal rate, such as withdrawing 4% annualized can actually help to ensure that your holdings last over the long term.  Your approach have been quite conservative by allowing less than half of what you've considered to be sustainable, as it can help to provide some kind of buffer against potential downturns in the market.

There are two sides to this. As you said, when the price of Bitcoin falls during a market downturn, the value of the withdrawal will decrease a lot. If you see that the market is going to fall, then do not withdraw the investment, take some time and withdraw when the market returns to its previous condition. You have an emergency fund to deal with emergencies. So I think you can wait for a few days. The Bitcoin market is very volatile, you can never tell when what will happen. So this issue cannot be said.

But yes, the issue that JJ sir has raised is really a very beautiful process among us. It would be very good for all those who have reached the excess savings level to adopt this method.

Sometimes I wonder if I need to go back through some of my prior posts to clarify my own way of seeing this, and sure it is true that any guy who has reached overaccumulation status then he does not really need to worry about the extent to which he is cashing out some coins during dipping periods.  Sure for prudence sake, any guy might choose to try to time his withdrawals so that he is not selling at the maximum of the dip, yet at the same time, I don't really see any reason to get overly worked up about the amount being withdrawn as long as the spot price is at least 25% higher than the 200-WMA, then the full amount is authorized to be withdrawn, and I suggest that up to 10% of the 200-WMA dollar value can be withdrawn.

So right now the BTC price is around 63% higher than the 200-WMA, and so there are not any restrictions and the whole monthly amount can be withdrawn.  If a person has a withdrawal rate of $80k per year, which would be $6,666 per month, then right now his monthly withdrawal amount would be 0.07298476, and he would need to have at least 14.3255 in order to have enough bitcoin (threshold level) for such an $80k per year withdrawal rate. 

Sure it is better to have an extra amount as a cushion in order to feel comfortable that the BTC is going up in value faster than it is being withdrawn, and sure if a guy is not comfortable with such a high withdrawal rate (such as 10% of the 200-WMA dollar value), then he can adjust his withdrawal rate in order to be comfortable, and if he withdraws faster than bitcoin's appreciation, then that is his own fault in terms of making sure that he is calculating correctly and not going over his self-imposed limit.

There could also be problems in which a guy is withdrawing way too little, and he is overly conservative, and so surely withdrawing too conservatively would seem to be a better problem to have as compared with withdrawing too aggressively and depleting your BTC stack faster than it is able to sustain itself in terms of the 200-WMA dollar value.

[Finebone]

, and sure it is true that any guy who has reached overaccumulation status then he does not really need to worry about the extent to which he is cashing out some coins during dipping periods.  Sure for prudence sake, any guy might choose to try to time his withdrawals so that he is not selling at the maximum of the dip, yet at the same time, I don't really see any reason to get overly worked up about the amount being withdrawn as long as the spot price is at least 25% higher than the 200-WMA, then the full amount is authorized to be withdrawn, and I suggest that up to 10% of the 200-WMA dollar value can be withdrawn.

Bitcoin investors that have gotten to that over accumulation status will not want to withdraw some profit from their Bitcoin investment if it's not close to the top or if the price is not fair because it's going to look like a loss. Let me use myself as an example, I will never sell or be taking profits from my Bitcoin during a dip, even though am in a massive profit when am at my over accumulation status, because I see those dip period as a time we should be buying and taking advantage of, no relinquishing the one's I already have at a cheaper rate. Some people might act in the direct opposition of mine but that's why I think that every may not act the same way.

[SilverCryptoBullet]

Bitcoin investors that have gotten to that over accumulation status will not want to withdraw some profit from their Bitcoin investment if it's not close to the top or if the price is not fair because it's going to look like a loss. Let me use myself as an example, I will never sell or be taking profits from my Bitcoin during a dip, even though am in a massive profit when am at my over accumulation status, because I see those dip period as a time we should be buying and taking advantage of, no relinquishing the one's I already have at a cheaper rate. Some people might act in the direct opposition of mine but that's why I think that every may not act the same way.

When you have small finance and investment capital, you can have more need of scaling your investment capital and portfolio. It's the most challenging phase in your financial growth but if you are rich already, you can more comfortably accumulate bitcoins while the new investment capital spent won't affect your finance generally.

Since that phase, you will more easily do either accumulation more bitcoins or you can gradually withdraw your profit. There is no reason to hold your bitcoin forever and if you gradually withdraw your profit, it's not kind of bad investment idea.

JJG has a withdrawal strategy with time too.

[JayJuanGee]

, and sure it is true that any guy who has reached overaccumulation status then he does not really need to worry about the extent to which he is cashing out some coins during dipping periods.  Sure for prudence sake, any guy might choose to try to time his withdrawals so that he is not selling at the maximum of the dip, yet at the same time, I don't really see any reason to get overly worked up about the amount being withdrawn as long as the spot price is at least 25% higher than the 200-WMA, then the full amount is authorized to be withdrawn, and I suggest that up to 10% of the 200-WMA dollar value can be withdrawn.

Bitcoin investors that have gotten to that over accumulation status will not want to withdraw some profit from their Bitcoin investment if it's not close to the top or if the price is not fair because it's going to look like a loss. Let me use myself as an example, I will never sell or be taking profits from my Bitcoin during a dip, even though am in a massive profit when am at my over accumulation status, because I see those dip period as a time we should be buying and taking advantage of, no relinquishing the one's I already have at a cheaper rate. Some people might act in the direct opposition of mine but that's why I think that every may not act the same way.

In the post of mine that you linked, I already gave the example of the guy who is wanting/requiring an income of $0k per year, and surely if he has at least 14.3255 BTC, then he has enough to make his monthly withdrawals, yet maybe he never wants to go below his overaccumulation status threshold level, so he might want to have at least 0.07298476 BTC extra in order to make his monthly withdrawal amount (which is $6,666).

Or maybe if he were going to withdraw a whole year in advance, then he would want somewhere in the ballpark of 0.87 extra, so that when he makes the withdrawal he does not go below overaccumulation status.  So each time he makes the withdrawal he needs to make sure that he does not go below overaccumulation status, and so it surely would be helpful if he has a bit of a cushion so that he does not have to enter into such calculations to make sure that he does not withdraw and cause himself to go below overaccumulation status .. which he had already set at a place that is allowing him to withdraw $80k per year and $6,666 per month.

If we are over our threshold amounts, then we do not have to worry. and we do not need to spend and replace and we don't have to buy bitcoin on dips.

Sure there could be some guys who would not engage in sustainable withdrawal unless they were to maintain themselves a certain level above the minimal threshold whether they would want it to be 25% higher or 505 higher or 100% higher or whatever discretionary amount.  Surely your choice to buy rather than sell is your choice, and it is not necessary, and including it may well be better for guys to continue to sell once they reached time based sustainable withdrawal if they are wanting to keep to their budget and to keep to their standard of living.

There are quite a few guys who seem to not understand the significance of reaching overaccumulation status.,. which means that you have more than enough and you can spend from that extra.  Sure, if you fall back below overaccumulation status, then you may well need to go back to accumulating bitcoin to get back to overaccumulation status, yet it seems to me that guys can put sustainable withdrawal systems in place so that they do not have to go back to accumulating bitcoin.,. and yeah, some guys are surely going to feel move comfortable if they maintain a cushion of excess BTC so that they are not worried about dropping back below overaccumulation status.

Let me repeat once again.  If a guy has a threshold into overaccumulation status that is currently 14.3255 BTC in order to maintain an income of $80k per year or $6,666 per month, then I would think that if the guy has 28.65 BTC, then there should not be any problem at all withdrawing $80k per year or $6,666 per month, whether the price is up, down or sideways... Sure, within my time-based sustainable withdrawal suggestions, I start to suggest cutting back on the withdrawal amounts once the BTC price is lower than 25% above the 200-WMA.. yet right now we are still 63% above the 200-WMA.. so the lowness of the BTC price, even though we had a 36% dip, is not low enough to trigger lessening of the monthly withdrawal amount.

Of course, you are free to calculate differently from me, and of course, if you blindly follow someone else's system, then you might end up getting yourself into trouble since you have to make sure that the numbers work for you, your finances and your psychology.

[SuperBitMan]

Bitcoin investors that have gotten to that over accumulation status will not want to withdraw some profit from their Bitcoin investment if it's not close to the top or if the price is not fair because it's going to look like a loss. Let me use myself as an example, I will never sell or be taking profits from my Bitcoin during a dip, even though am in a massive profit when am at my over accumulation status, because I see those dip period as a time we should be buying and taking advantage of, no relinquishing the one's I already have at a cheaper rate. Some people might act in the direct opposition of mine but that's why I think that every may not act the same way.

When you have small finance and investment capital, you can have more need of scaling your investment capital and portfolio. It's the most challenging phase in your financial growth but if you are rich already, you can more comfortably accumulate bitcoins while the new investment capital spent won't affect your finance generally.

Since that phase, you will more easily do either accumulation more bitcoins or you can gradually withdraw your profit. There is no reason to hold your bitcoin forever and if you gradually withdraw your profit, it's not kind of bad investment idea.

JJG has a withdrawal strategy with time too.

Yes, withdraw 10 or 5 percent of your profit when ever there's a rise in Bitcoin, now the reason why one should follow the strategy is because you need to keep your bitcoin investment going why withdrawing from it, and you know very well that if you start withdrawing your Bitcoin it will surely get exhausted however with this strategy your Bitcoin will not be exhausted because you are only taken profit from your Bitcoin investment and not your Initial Capital so your Bitcoin investment will keep on going because the Initial Capital is intact you only withdraw the profit, everyone who has gotten to the stage of withdrawing his or her Bitcoin should use this strategy if he or she still want his or her bitcoin investment to keep existing in the future.

[Cossyblack]

When you have small finance and investment capital, you can have more need of scaling your investment capital and portfolio. It's the most challenging phase in your financial growth but if you are rich already, you can more comfortably accumulate bitcoins while the new investment capital spent won't affect your finance generally.

Since that phase, you will more easily do either accumulation more bitcoins or you can gradually withdraw your profit. There is no reason to hold your bitcoin forever and if you gradually withdraw your profit, it's not kind of bad investment idea.

JJG has a withdrawal strategy with time too.

Investors should learn how to manage their personal finances effectively in the sense that it doesn't disrupt their Bitcoin accumulation. Money management skill is important because, without it,an investor lacks the ability to manage his funds,cover for his basic needs and figure out his Discretional incomes which is necessary for him to accumulate Bitcoin smoothly, consistently,  persistently.

Furthermore, Every investor deserve to reap the fruit of their labour, but they shouldn't withdraw profits that would affect their Bitcoin holdings. An investor who has attain Over-accumulation in Bitcoin should Hodl for two Bitcoin cycles inoder to allow his Bitcoin portfolio build value over time before he slowly withdraw profits out of it,because if he keeps withdrawing profits from time to time,he will end up selling his Bitcoin investment if care isn't taken.

[JayJuanGee]

Bitcoin investors that have gotten to that over accumulation status will not want to withdraw some profit from their Bitcoin investment if it's not close to the top or if the price is not fair because it's going to look like a loss. Let me use myself as an example, I will never sell or be taking profits from my Bitcoin during a dip, even though am in a massive profit when am at my over accumulation status, because I see those dip period as a time we should be buying and taking advantage of, no relinquishing the one's I already have at a cheaper rate. Some people might act in the direct opposition of mine but that's why I think that every may not act the same way.

When you have small finance and investment capital, you can have more need of scaling your investment capital and portfolio. It's the most challenging phase in your financial growth but if you are rich already, you can more comfortably accumulate bitcoins while the new investment capital spent won't affect your finance generally.

Since that phase, you will more easily do either accumulation more bitcoins or you can gradually withdraw your profit. There is no reason to hold your bitcoin forever and if you gradually withdraw your profit, it's not kind of bad investment idea.
JJG has a withdrawal strategy with time too.

Yes, withdraw 10 or 5 percent of your profit when ever there's a rise in Bitcoin,

If you withdraw as the price goes up, that is called "price-based" withdrawal and not "time-based" withdrawal.

If you want your withdrawal to be sustainable you need to figure out some kind of formula - not just picking an amount to withdraw without choosing how much the price would need to go up in order to trigger that withdrawal amount.

As an example, I usually like to suggest that a person could sustainably withdraw 10% every time the BTC price doubles, and so he would still have 40% compounding since it is not getting withdrawn.  A person who withdraws 50% every time it doubles would never experience any compounding of value.

A person could also withdraw 1% for every 10% rise in value and that would give similar results as 10% for every doubling of value.

I personally suggest reaching overaccumulation status before employing any of these withdrawal strategies, and time-based sustainable withdrawal likely requires (or works better) with a higher level of overaccumulation status since, for example, from my perspective and assessment right now, a person who currently reached at least a 14.315 BTC size stash could sustainably withdraw $80k per year or $6,666 per month forever, and ever and ever as long as the BTC price stays at least 25% above the 200-WMA.. and that is mostly withdrawal based on time and not on price.

now the reason why one should follow the strategy is because you need to keep your bitcoin investment going why withdrawing from it, and you know very well that if you start withdrawing your Bitcoin it will surely get exhausted however with this strategy your Bitcoin will not be exhausted because you are only taken profit from your Bitcoin investment and not your Initial Capital so your Bitcoin investment will keep on going because the Initial Capital is intact you only withdraw the profit, everyone who has gotten to the stage of withdrawing his or her Bitcoin should use this strategy if he or she still want his or her bitcoin investment to keep existing in the future.

The reason that you can withdraw forever is because your bitcoin is growing in value faster and/or at a greater amount than you are withdrawing from it.  The reason that you get your bitcoin stash up to a certain size prior to starting to withdraw from it is so that you can reach the withdrawal rate that you want, so a person who ONLY wants to withdraw $8k per year and $666 per month, then he is ONLY going to need a stack size that is 1/10th the size of the guy who wants $80k per year and $6,666 per month... so even with my earlier link, such a guy would currently need to have at least 1.4315 BTC in order to start with such a time-based sustainable withdrawal strategy of $8k per year which is $666 per month.

Of course, there can be risks if we are right on the edge of eligibility for such a withdrawal strategy, and so frequently it can be good to accumulate beyond your threshold level of bitcoin accumulation so that you have room to account for any errors that might exist within the calculations... and for sure, each person is responsible to make sure his particulars are correct and working for his situation.

Once guys reach overaccumulation status, there is no need to continue to accumulate more bitcoin, yet sure it is understandable that some guys might still optionally want to accumulate more bitcoin in order to make sure that they have more cushion in their stack size and/or maybe they want to create a higher sustainable withdrawal level so that they can live a higher standard of living.. so in my earlier example a guy might reach at least 14.315 BTC to be able to withdraw $80k per year, and even with that amount it is quite likely that each year he is able to increase his withdrawal amount by 7% and it is still sustainable forever and ever and ever.. yet he might want a higher starting amount and he might feel that a raise of 7% per year is not enough for him.. so he might retain a goal to get up to a higher amount, such as $100k per year as his starting point or maybe even $160k (double his initial plan) before he gets started withdrawing from his BTC holdings.. .and wether he is being unrealistic or not, those are his choices to make.

[edited out]

Investors should learn how to manage their personal finances effectively in the sense that it doesn't disrupt their Bitcoin accumulation. Money management skill is important because, without it,an investor lacks the ability to manage his funds,cover for his basic needs and figure out his Discretional incomes which is necessary for him to accumulate Bitcoin smoothly, consistently,  persistently.

Furthermore, Every investor deserve to reap the fruit of their labour, but they shouldn't withdraw profits that would affect their Bitcoin holdings. An investor who has attain Over-accumulation in Bitcoin should Hodl for two Bitcoin cycles inoder to allow his Bitcoin portfolio build value over time before he slowly withdraw profits out of it, because if he keeps withdrawing profits from time to time,he will end up selling his Bitcoin investment if care isn't taken.

In respect to the second paragraph of your response, I generally agree with the idea that any new money that goes into bitcoin should have at least a 4 year timeline before it should be eligible for withdrawal, yet there is also something about reaching overaccumulation status that would end up overriding those other calculations and considerations, since once you made it to overaccumulation status, you are already there.. and maybe at that point, it is just a matter of how much of a cushion that you have so that you feel comfortable getting started with your withdrawal.. and yeah, if you had ONLY recently put some of the money in, it may well be the case that you would rather let the investment sit for a bit more time before transitioning into sustainable withdrawal practices.

Maybe an example would make this a bit more clear? If a person knows that he currently needs 14.315 BTC in order to start a sustainable withdrawal of $80k per year, and he ONLY has 12.315 BTC, he is 2 BTC short, and so he still has a few options.  1) he could start to withdraw at the rate that the 12.315 BTC allows (which would be $68.8k per year or $5,735 per month) 2) he could withdraw at some lower rate 3) he could continue to add to his BTC stash, or 4) he could just wait until his 12.315 were to support an $80k income, which may well be within the next year (since the amount of BTC needed for whatever income level tends to go down with the passage of time  - we can see that in the historical numbers of my fuck you status chart and its future projections) - he can keep monitoring the situation to see when his 12.315 BTC gets to such ability to be able to start to withdraw at $80k per year.. if that might continue to be his target point in which he would start his withdrawing from his stash.

Whether the guy needs to wait or not before he can transition between accumulation and then to maintenance and then to sustainable withdrawal depends on his situation, and even though I agree that it logically makes sense to have some time between being in accumulation status before transitioning to sustainable withdrawal, a guy still could meet his own criteria without necessarily having any kind of long transition between accumulating and then transitioning into sustainable withdrawal - even though it does tend to make sense to let any of our investments into bitcoin to ride for a while before starting to withdraw, yet any person might put himself in a kind of maintenance stage in which he might be buying and withdrawing (not in a trading sense) and largely just maintaining his BTC stash while he might be employing price-based maintenance prior to his transitioning into time-based sustainable withdrawal.

[Gost ms]

Yes, withdraw 10 or 5 percent of your profit when ever there's a rise in Bitcoin, now the reason why one should follow the strategy is because you need to keep your bitcoin investment going why withdrawing from it, and you know very well that if you start withdrawing your Bitcoin it will surely get exhausted however with this strategy your Bitcoin will not be exhausted because you are only taken profit from your Bitcoin investment and not your Initial Capital so your Bitcoin investment will keep on going because the Initial Capital is intact you only withdraw the profit, everyone who has gotten to the stage of withdrawing his or her Bitcoin should use this strategy if he or she still want his or her bitcoin investment to keep existing in the future.

Even if a person is in the savings stage, he can withdraw some amount of money and enjoy it. But there is a rule to do so which @JJ sir follows, if a person gets 2 times the amount of money from his investment and if his period has not expired then he can withdraw some amount of money and enjoy the profit if he wants. But if he withdraws a lot of money then it will never be good for him and his portfolio.

If a person reaches excess savings and if his period has expired and if he wants to withdraw his investment then he can do so but withdrawing the entire amount of investment will never be the right decision. He can withdraw as much as he needs. But if he does not need the money and if he withdraws his investment right away then it can be a reason for regret for him after a while. Because currently Bitcoin has transformed into a digital asset. It is expected that in the future the demand for Bitcoin will increase a lot more and the price of Bitcoin will skyrocket even more

[AakZaki]

The allocation of the money is the important thing so we can continouosly investing in Bitcoin without have a problem in finance. Bitcoin investment is a long term investment so should have patient and focus with that to achieve our goals in the future. Many people forget this rule and become panic especially if they don't have a strong hands.

It is not easy to hodl Bitcoin until the time but that is the challenge that we should face and solve how to hodl Bitcoin with tight. DCA really help those who want to wait with patient and there will be a big reward for them.

Money allocation and discipline in managing capital are the main foundations of Bitcoin investment or any investment for that matter. I agree that impatience and panic often arise because we invest money we shouldn't be using for risky things or because we focus too much on day to day fluctuations when our goals are long term.

DCA is like a Secret Weapon to deal with volatility because we don't have to worry about the right timing. We can be consistent and let time work. The biggest challenge is our own psychology of how to stay calm when prices drop sharply and how not to be tempted to sell everything when prices are rising rapidly.

I'd also like to add that in addition to DCA, secure Bitcoin storage such as using a hardware wallet for large amounts is also an important aspect that is often overlooked. When assets are safe, our minds are calm and we can focus more on long term goals without distractions.

[Finebone]

If a person reaches excess savings and if his period has expired and if he wants to withdraw his investment then he can do so but withdrawing the entire amount of investment will never be the right decision. He can withdraw as much as he needs.

I understand what you are trying to say but your write up seems complicating and confusing.
Once you get to that over accumulation status and you wishes to withdraw some profit, what you should be doing is withdrawing some profit that will not take you out of your over accumulation status and secondly, selling everything and become a no coiner overnight is a complete disaster and a terrible thing to do as a Bitcoin investor.

Because currently Bitcoin has transformed into a digital asset.

So what was Bitcoin before now?
Or what do you mean?

It is expected that in the future the demand for Bitcoin will increase a lot more and the price of Bitcoin will skyrocket even more

Yes for sure, because Bitcoin is still pretty young and is no where close to it real potential or peak price.

[JayJuanGee]

Yes, withdraw 10 or 5 percent of your profit when ever there's a rise in Bitcoin, now the reason why one should follow the strategy is because you need to keep your bitcoin investment going why withdrawing from it, and you know very well that if you start withdrawing your Bitcoin it will surely get exhausted however with this strategy your Bitcoin will not be exhausted because you are only taken profit from your Bitcoin investment and not your Initial Capital so your Bitcoin investment will keep on going because the Initial Capital is intact you only withdraw the profit, everyone who has gotten to the stage of withdrawing his or her Bitcoin should use this strategy if he or she still want his or her bitcoin investment to keep existing in the future.

Even if a person is in the savings stage, he can withdraw some amount of money and enjoy it. But there is a rule to do so which @JJ sir follows, if a person gets 2 times the amount of money from his investment and if his period has not expired then he can withdraw some amount of money and enjoy the profit if he wants. But if he withdraws a lot of money then it will never be good for him and his portfolio.

If a person reaches excess savings and if his period has expired and if he wants to withdraw his investment then he can do so but withdrawing the entire amount of investment will never be the right decision. He can withdraw as much as he needs. But if he does not need the money and if he withdraws his investment right away then it can be a reason for regret for him after a while. Because currently Bitcoin has transformed into a digital asset. It is expected that in the future the demand for Bitcoin will increase a lot more and the price of Bitcoin will skyrocket even more

I largely already responded to this question of how to maintain sustainable withdrawal and how to not go below overaccumulation status in a post that I just made (responding to @cxtreenal).

[edited out]

DCA is like a Secret Weapon to deal with volatility because we don't have to worry about the right timing. We can be consistent and let time work. The biggest challenge is our own psychology of how to stay calm when prices drop sharply and how not to be tempted to sell everything when prices are rising rapidly.

In this thread, we are assuming that we have already gone through our BTC accumulation phase, so once we reach overaccumulation status and we start sustainable withdrawal, we would not necessarily need to engage in DCA practices or to reaccumulate the  BTC that we sold... - even though I do admit in both my price based sustainable withdrawal system and also in my time-based sustainable withdrawal system, I do allow for buy backs since I expect that one of the most inevitable characteristics of bitcoin remains its volatility, so it would seem a bit strange to not buy back any BTC if the prices were to drop after we had sold (whether price based sales or time based sales)

If a person reaches excess savings and if his period has expired and if he wants to withdraw his investment then he can do so but withdrawing the entire amount of investment will never be the right decision. He can withdraw as much as he needs.

I understand what you are trying to say but your write up seems complicating and confusing.
Once you get to that over accumulation status and you wishes to withdraw some profit, what you should be doing is withdrawing some profit that will not take you out of your over accumulation status and secondly, selling everything and become a no coiner overnight is a complete disaster and a terrible thing to do as a Bitcoin investor.

Because currently Bitcoin has transformed into a digital asset.

So what was Bitcoin before now?
Or what do you mean?

It is expected that in the future the demand for Bitcoin will increase a lot more and the price of Bitcoin will skyrocket even more

Yes for sure, because Bitcoin is still pretty young and is no where close to it real potential or peak price.

I am not really against anything you said Finebone, even though I get the sense that someone who has long been in bitcoin and is in over accumulation status, profits are largely assumed, so none of the guys in overaccumulation status are motivated by taking profits but instead just withdrawing within a spot that is less than the growth rate, so the bitcoin investment continues to grow in dollar value, yet at the same time, if a guy wants to move from sustainable withdrawal and into depletion of his bitcoin holdings, then he might have some specific reason, such as impending death and/or no necessary desire to pass on wealth after his death.

[dan_dony]

✂️✂️✂️

Even though everything that you are saying comes off as mostly correct, it also comes off as a bit theoretical if you cannot elaborate on what you mean a bit better, perhaps with the use of some examples or something like that.

Okay let's try looking at a hypothetical scenario of a successful entrepreneur who has over the years, built quite a sizable amount of Bitcoin, and as the years goes by, her Holdings have significantly grown and have reached a state of overaccumulation, and now worth around $10 million.

Now the entrepreneur's focus shifts from building more wealth and stacking up more funds to managing his existing portfolio and optimizing his financial position. He's determined to maintain his desired lifestyle, render financial support to his family and still ensure his financial stability.
So to achieve this goal, he decides to implement a time based strategic withdrawal approach by selling only 2% of his Bitcoin holdings quarterly, and by doing this, it allows the entrepreneur to generate a steady income stream while also simultaneously minimizing tax implications.

And even in times when the market starts experiencing a sudden decline and the price of Bitcoin drops by 30%, as many investors begins to panic and selling off their Bitcoins, the entrepreneur keeps his cool and sticks to selling only the predetermined amount of Bitcoin according to his plan earlier and thereby, ignoring the  short term market fluctuations, but rather interested in achieving his long-term financial goals.
And by prioritizing his financial stability, by managing tax implications and maintaining his planned allocation, he's able to optimize his financial position, while simultaneously minimizing and mitigating unnecessary risks. His strategic bitcoin withdrawal strategy enables him to achieve his specific objectives and also ensuring that he's more prepared for the future.

Your example is a good example of the concept, particularly the notion of moving away or rather switching accumulation to disciplined long term portfolio management. One can use a time withdrawal scheme such as 2 percent quarterly since this would help one to eliminate emotion when selling large amounts and ensure the interest stays on long-term sustainability rather than market clatter. The main thing is that one should be loyal to the strategy even when drawing down and this is where the majority of people make the mistake. Nevertheless, the success here is strongly dependent on individual factors- tax regulations, expenses requirements and general diversification. A plan in itself is wonderful, but it must be reviewed periodically to make certain that the rate of withdrawal and the allocation remains to the long term goals of the individual.