[ANN] JJG Sustainable Bitcoin Withdrawal Strategy

[wallet4bitcoin]

I love the concept and the idea, it is very detailed however I expect to see a more robust scope of coverage in time to come. It might start as a narrowly focused concept or idea but will expand in a short while.

From the wealth of experiences you hav egarnered over the years, i expect to see them playout even as the trust in the community gets directed to your project.

[JayJuanGee]

I don't know this strategy in detail. But, in a quick test I did, I didn't understand until when my BTC would be available, with this strategy. So I think it would be really interesting to have a timeline on this information.

I agree that there might be some easier or better ways to describe what is being attempted with this kind of tool, which means how any of us might attempt to put it into use for ourselves and in accordance with our circumstances (such as the size of our BTC stash or a part of our stash) and if we feel that we are getting to the stage that we would like to begin some kind of a regular and hopefully sustainable withdrawal depending on how aggressive that we might be in our withdrawal system.   Another thing is that maybe you have a bitcoin stash of 100, but you want to put 21 BTC into a business or a trust, and then tell them that their budget is based on the sustainable withdrawal system, and maybe you even tell them what withdrawal rate to use, and if you might be beginning with such process, you might choose a lower percentage, so that you get used to the idea of withdrawing, but you are withdrawing in such a conservative way that in a longer term basis you are not tending to lessen your BTC value, especially if you are measuring it in terms of the 200-week moving average rather than the spot price.  Of course, when you withdraw, you will get the spot price for the BTC that you sell, so there is a presumption that you are actually cashing out the BTC or using the BTC for some kind of a purchase of a good or service.

Well, I am going to try to stick with the 21 BTC as an example that I gave in my thread, and I showed more than a year of withdrawal and ONLY 0.5 BTC had been withdrawn, and those withdrawal amounts were generally on the conservative side... and still getting used to the system, yet at the same time, the BTC price spent a lot of time below the 200-week moving average, so the withdrawal amounts were reduced during that period of time, so if you look at the explanation on the site, the BTC spot price needs to be at least 25% the spot price before you are allowed to withdraw the full monthly allotment (based on whatever percent that you had already established, and my earlier examples used 4%, since that is quite a conservative percentage and lines up with traditional ideas of withdrawing asset, such as in retirement income purposes).

So if the BTC spot price is less than 25% above the 200-WMA, there are various gradients of reduction of the amount that is authorized for withdrawal.


If you look at the above selection of 20.5BTC at 4% withdrawal rate, you will see that currently, the spot price of that 20.5 BTC is 41.93% higher than the 200-week moving average, which makes the whole portfolio worth $877,072 in terms of its spot price as compare to its 200-wma value at only $617,975.24, so for this month, there is an ability to withdraw up to 0.6833333 BTC which has a BTC spot price value of $2,923.57 if you cash it out right away.  You can also cash out up to 1 month in advance, but then you won't be able to cash out the next month, unless the BTC price is at least to a level that authorizes additional months.  To me it seems that the most important number is the number of BTC that you can withdraw, and if the BTC price is changing throughout the month, then maybe it is less confusing to withdraw all at once for the month.  

You have the ability to define the beginning and end of the month however you like whether it starts on the 1st of the month or the 15th, and then whether you decide to withdrawal in a lump sum or 1/4th of the authorized amount weekly for 4 weeks.. which is not quite a month.. but according to this tool, a month is 1/12th of a year, even if there are different numbers of days in each month.

If you withdraw advance months, then you need to keep track of that.  Let's say that I decide to structure this tools so that my months begin on the 10th of each month, so the 10th would be the earliest that I could withdraw for January, and if I decide to withdraw for January and for February, then I would not be able to withdraw again until March 10 at the earliest, unless the BTC price passes above some other threshold that authorizes the withdrawal of additional months.  

Just because you can withdraw the max does not necessarily mean that you have to withdraw the max, especially if the BTC price is close to or even below the 200-week moving average, but if the BTC spot price goes to more than 14x higher than the 200-week moving average you may well be incentivized to take advantage of withdrawing the additional 59 months because the spot price is so high, and if you had already withdrawn some of the additional months at earlier stages, then it is upon you to keep track of how many months in advance that you had already withdrawn in order to figure out how many you still have remaining in your authorization, so if you had withdrawn 35 months in advance after the BTC price went 650% higher than the 200-week moving average, and then 1 month later the BTC price goes up 14x higher than the 200-week moving average, you could withdraw 24 or 25 extra months whether you had moved into a new month, and if you had not moved into a new month, you would only be able to withdraw 24 additional months in the 14x higher range (that is 59-35).

Maybe another example is in order.

If you had been using this same system on December 16, 2017, then maybe you might have needed to have 500 BTC in order to have a similar amount of 200-week moving average value as is the 20.5 BTC today, and at that point, BTC spot price was more than 15x higher than the 200-WMA, and your 200-WMA value would have been around $604k but your BTC spot price value would have been close to $10 million..



With a 4% withdrawal rate, the tool would have allowed you to withdraw 1.66666667 BTC per month and 59 months advanced, which would have had been 98.333333 BTC.  Of course, if you had already withdrawn some advanced BTC, you would only be authorized to withdraw the amount of BTC that you had remaining from the 59 advanced months and/or the then current month.

Another interesting approach would be to indicate the USD value that the user wanted to withdraw. This allows you to get an idea of how long the value in your portfolio would last.

Each month, you are ONLY allowed to withdraw the BTC that is authorized for that month, so you should be measuring how much BTC to withdraw, and of course it has a dollar value that day that is changing on a regular basis, but the 200-week moving average does not change as much as the spot price.  And, you should able to continue to withdrawal in this kind of way in perpetuity (which is another way of saying sustainable) as long as BTC continues to perform at least as high as your withdrawal rate (which means that as long as the BTC increases in its dollar value on average at least at the rate that you are withdrawing).  Yeah your BTC amount will continue to go down but its dollar value would continue to go up at least at the rate that you are withdrawing, and if you are withdrawing more than the rate it goes up then the system would not be sustainable, but this system presumes sustainability based on fundamental analysis and various BTC price performance theories, including that you can look at my projection of the entry-level fuck you status chart, and if you believe that BTC future price projections should be more conservative than the ones that I indicated there (which seem somewhat conservative already), then you can reduce your withdrawal rate in accordance with your own beliefs in order to feel more comfortable with your own view regarding how much of a BTC withdrawal rater that you believe to be sustainable..

Another point that I noticed, although the price chart is possible to apply several temporal filters, I found it a little unnecessary (and perhaps confusing), since the strategy is about the last 200 days. So the graph should only show data from the last 200 days.

It is a 200-week moving average not the 200-day moving average.  200 weeks is about 4 years, and 200 days is about 2/3rds of a year.

Part of the reason to have the history is to see how the spot price has moved in reference to the 200-week moving average, and to see that the 200-week moving average tends to be a bottom, except the recent 16 months (between about June 2022 and October 2023) the 200-week MA was not as much of a complete bottom indicator, but still we stick with the theory of 200-week moving average mostly being a bottom price because it mostly holds up.  

This tool is also not for trading.. which might be something that the 200-day moving average might be used for.

Here are my first impressions. I will keep an eye on the project. Thank you for your work.

We may well need to continue to figure out better ways to present this information.. or to clarify certain parts a bit better so it might start to seem more obvious regarding how to try to use the tool in ways that will be helpful to each of those wanting to use the tool.

Very good, can I make a suggestion?

put something like this, but referring to the past. For example.

If I had used this strategy from 2016 to 2020, how much return would it give? How much could I withdraw? It would be very interesting for those who are not used to this type of investment to see what profitability they would have lost if they had followed this strategy.

Other than that, very good and congratulations to everyone involved.

It could be possible that we could give an example that would show someone starting with a certain BTC stash in 2016, and then ending with a smaller amount of BTC in 2020.  My Hypomyth chart does something like that in order to project ahead.

Of course, above in my response to joker_josue I already mentioned that in terms of its dollar value, a budget of 20.5 BTC today is similar to a budget of 500 BTC in 2017, so the stash for 2016 would be even higher to be the equivalent of my 20.5 BTC example of today, and of course various posts in my thread also shows how the hypothetical had started out at 21 BTC in late 2022, and currently has been reduced by 0.5 BTC due to monthly withdrawals.

I love the concept and the idea, it is very detailed however I expect to see a more robust scope of coverage in time to come. It might start as a narrowly focused concept or idea but will expand in a short while.

If you know how to use the tool in terms of trying to make quick comparisons of how the 200-weekMA and the spot price have differed historically or even at any particular time (such as today right now as the price moves), the tool already provides a lot of information that would be otherwise difficult to figure out in such a rapid way and especially incorporating your own specifics into such a tool, that is if you know what the tool is showing.  

It could be the case that some of the information in the input area versus the output could be presented with some better clarity and some better explanations, but if you figure out a budget that you have (whether that is a budget of 20.5 BTC or some other amount) and if you figure out your withdrawal rate (whether you are going to use 4% or some other rate), then you can get some quick answers to your questions, including if you change the dates or if you quickly change some of the amounts that you would like to use.

From the wealth of experiences you hav egarnered over the years, i expect to see them playout even as the trust in the community gets directed to your project.

I think that my entry-level fuck you status chart shows how bitcoin-bottom prices has performed over time, and if we believe that we have accumulated enough BTC, then we can start some kind of withdrawal of them on a regular basis... It may well not be a good idea to start any withdrawal system until reaching a certain quantity of BTC in which it starts to seem practical to move from the accumulation stage to the maintenance stage and then to the liquidation stage, and if you are still accumulating BTC and not quite sure which stage that you are in, then you might not have enough BTC to feel comfortable using the tool - especially since this is not meant to be a trading tool.. except to the extent that any of us could use this kind of tool to manage our BTC portfolio in a way that gives us more comfort in regards to guiding us regarding our monthly budget during times of high volatility, which is quite common for bitcoin historically and likely to be inevitable in bitcoin's future, in spite of people ongoingly wanting to suggest hat bitcoin is becoming a mature asset.. which relatively speaking I have my doubts about its volatility and/or battles going away in the coming 10-15 years or more.

[joker_josue]

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Thank you for your explanation, I better understood the idea of this strategy, and the objective of the tool itself.

Basically, and very basically, the ideal would be for the person to consult this tool every month, to check whether or not they should make the withdrawal. Perhaps some more information could be added to the tool to help with this reading. And allow us to indicate whether or not it is recommended to make the withdrawal. Of course, in the end the decision is up to the person, based on the information collected.

Congratulations on the tool and idea. I will continue to follow. 

[JayJuanGee]

~~

Thank you for your explanation, I better understood the idea of this strategy, and the objective of the tool itself.

Basically, and very basically, the ideal would be for the person to consult this tool every month, to check whether or not they should make the withdrawal. Perhaps some more information could be added to the tool to help with this reading. And allow us to indicate whether or not it is recommended to make the withdrawal. Of course, in the end the decision is up to the person, based on the information collected.

Congratulations on the tool and idea. I will continue to follow. 

I am trying to consider some possible ways to make some better examples and/or explanations regarding how to use the tool so that it might be more obvious on its face how might be the better ways to use the tool, even though at the same time, there is enough flexibility within the tool in terms of setting your own conditions regarding how much BTC that you want to subject to the tool or how high of a percentage you would like to use as your withdrawal rate.  So, in that sense, I have already attempted to make representations by labelling the withdrawal rates with recommendations in terms of "conservative" versus "moderate" versus "aggressive" vs "extremely aggressive," yet at the same time, it could be the case that my recommendations are not very good in terms of BTC's actual future price performance in contrast to what its future performance is speculated to be. 

Sure the tool is not going to help any of us to determine the extent to which we might have enough BTC in order to even consider starting such a BTC withdrawal strategy because we might be premature in our desire to extract value out of our stash prior to our really having had established a sufficient enough stash to begin such a process, and yeah, and the tool cannot really completely give such guidance.

So for example currently, I would suggest that currently the default fuck you status level is around 67 BTC, that is $2 million / current 200-week moving average of $30,145 (you can plug those numbers in the tool and see those values); however, in my examples, I am describing a system to use "only" 21 BTC, and maybe even suggesting that 21 BTC could even be enough to begin such an ongoing withdrawal process even though default entry-level fuck you status has not yet been reached (if we might presume that there might be a goal to reach entry level fuck you status in the future), and still we well might well have great chances of reaching default entry-level fuck you status in the near future while engaging in a kind of sustainable withdrawal of the BTC rather than continuing to accumulate or even waiting to reach such entry-level fuck you status prior to beginning such a withdrawal.  Even my default entry-level fuck you status chart shows that the 200-week moving average might not move to a high enough level in order for 21 BTC to be entry-level fuck you status until late 2028, yet if by mid-2029, we were to still have at least 18.2 BTC, we may well would have still entered into default entry-level fuck you status, even if we engage in sustainable withdrawal so long as we had ended up depleting our BTC by slightly less than 3 BTC in the next 5-years-ish.

It seems to me that a guy would have better chances to be able to accomplish still growing his BTC value while engaging in ongoing withdrawals by engaging in more modest ("conservative") levels of BTC withdrawal such as 4% or lower rates of withdrawal rather than even using the higher levels of withdrawal of between 6% and 10% that I have labelled as "moderate," yet such higher levels of withdrawal would not necessarily be "moderate" if a guy is starting to use such tool with a BTC stash size that is way too small, such as if he might ONLY have a couple of bitcoin.. and I am not even saying that a couple of BTC is not enough to begin such a process of using such tool because each person has to decide for himself regarding what it is that he is wanting to achieve with his bitcoin and maybe what level of income (frequently considered as quasi-"passive" income) he would like to be able to withdraw from his bitcoin stash on a regular basis and still to either make sure it is sustaining its value, or maybe growing its value or maybe if he enters into aggressive withdrawal then he would be acknowledging that he may well be depleting his BTC stash rather than keeping it sustainable in a kind of perpetual way.   

So, yeah a guy could use the tool to help him in governing his whole BTC stash or maybe even if he were to create a separate BTC stash, and to create conditions on that separate stash (such as my example of starting with 21 BTC and then currently being down to 20.5 BTC after a bit over a year of following some kind of conservative withdrawal variation (i.e. around 4% or less) of this kind of sustainable withdrawal system).

[Odohu]

This might just be one of my great lessons of 2024 as the DCA method was for 2023. In other words, I learnt and started using the DCA method 2023, and in 2024, I'm also learning about something that looks like reversed DCA according to @Dkbit98.

I will take time to explore the website to fully grasp what it's all about and also make my input or ask questions, if any. I appreciate the effort you all are making in order to make us enjoy being part of the revolution called Bitcoin.

[JayJuanGee]

This might just be one of my great lessons of 2024 as the DCA method was for 2023. In other words, I learnt and started using the DCA method 2023, and in 2024, I'm also learning about something that looks like reversed DCA according to @Dkbit98.

Of course, I largely already attempted to respond to Dkbit98 in order to suggest why I did not consider this to be reverse DCA and I am not even sure if I like the term reverse DCA - except maybe if such term would be used to describe an even more aggressive style of withdrawal.. such as greater than 30%. .even though 30% is likely not going to be very sustainable either.. yet something like reverse DCA is likely even more aggressive than anything close to being considered as sustainable withdrawal... so the idea of sustainable withdraw would be that the withdrawals could be carried out perpetually, and there is no real dipping into the principle.. so if there ends up being a need to dip into the principle, then that is a different story... which maybe would be considered as reverse DCA.

I will take time to explore the website to fully grasp what it's all about and also make my input or ask questions, if any. I appreciate the effort you all are making in order to make us enjoy being part of the revolution called Bitcoin.

Look forward to your consideration of the matter, and surely it may well not be as relevant until you get closer to considering that you have reached your BTC accumulation targets, but surely if you might be getting close to reaching your accumulation targets or if you might want to set some bitcoin aside into a separate fund that has authorization to spend up to certain amounts, this tool may well be useful.

[criptoevangelista]

It could be possible that we could give an example that would show someone starting with a certain BTC stash in 2016, and then ending with a smaller amount of BTC in 2020.  My Hypomyth chart does something like that in order to project ahead.

Of course, above in my response to joker_josue I already mentioned that in terms of its dollar value, a budget of 20.5 BTC today is similar to a budget of 500 BTC in 2017, so the stash for 2016 would be even higher to be the equivalent of my 20.5 BTC example of today, and of course various posts in my thread also shows how the hypothetical had started out at 21 BTC in late 2022, and currently has been reduced by 0.5 BTC due to monthly withdrawals.

At a certain point, the investor's bitcoin supply will be equal to zero, right?

I didn't have time to read the other answers, I apologize for that, and I have one more question: is there any possibility that the strategy indicators inform that it is a good time to deposit more bitcoins so that the withdrawal is always sustainable?

From what I understand of the strategy, it is made to possibly make a profit and definitively close the positions, is that it?

But if I wanted to use it again, this is my question. I don't know if I expressed myself correctly.

[bitmover]

JayJuanGee can made better answers, but i will try to answer some questions.

At a certain point, the investor's bitcoin supply will be equal to zero, right?

It depends on which Annual Withdrawal rate you choose. If you go below 6%  (conservative), ideally, even when you are very old and about to die you would still have some BTC. This is a sustainable withdrawal strategy.

is there any possibility that the strategy indicators inform that it is a good time to deposit more bitcoins so that the withdrawal is always sustainable?

I think that when you are not allowed to withdrawal (when the price is below the 200WMA), it is a good time to buy.

There will be a second tool which will do something like this. But I am still learning about it and we will release in a few weeks/months.

[JayJuanGee]

It could be possible that we could give an example that would show someone starting with a certain BTC stash in 2016, and then ending with a smaller amount of BTC in 2020.  My Hypomyth chart does something like that in order to project ahead.

Of course, above in my response to joker_josue I already mentioned that in terms of its dollar value, a budget of 20.5 BTC today is similar to a budget of 500 BTC in 2017, so the stash for 2016 would be even higher to be the equivalent of my 20.5 BTC example of today, and of course various posts in my thread also shows how the hypothetical had started out at 21 BTC in late 2022, and currently has been reduced by 0.5 BTC due to monthly withdrawals.

At a certain point, the investor's bitcoin supply will be equal to zero, right?

I think that is an error in the presumptions that a lot of guys seem to be making, which I am trying to suggest that if any of us attempts to have a sustainable withdrawal, then the rate of our withdrawal should be equal to or less than the appreciation of the asset (in this case BTC). 

So for example if you withdraw 4% per year, you can do that forever so long as the bitcoin is appreciating in value at least 4% per year relative to what you are measuring it in, whether that is dollars, other fiat, gold, hookers, lambo, blow, housing, yachts, food, or whatever is the thing you are measuring it in. 

Even though in traditional assets, a withdrawal rate of 4% would consider to be sustainable, but it also ONLY works if the various investments are at least performing 4% or more on average (even if there are likely to be some poor performing years along the way, but overall if it is mostly averaging more than 4% performance, then you should be able to withdraw forever). 

I am also asserting that currently in bitcoin 6% to 10% has historically been sustainable, and has decently good chances of continuing to be sustainable in the near future based on bitcoin's historical performance and including a conception of its future performance - including that out of bitcoin's last 13 years, it's worst performance (in terms of the movement of the 200 week moving average) was in the past 18 months (between May 2022 and November 2023), which was 20% per year during that time (you can see the actual numbers per 6 month basis in my fuck you status chart).

So surely past performance does not guarantee future results; however, at the same time I am arguing the usage of the 200-week moving average to value your BTC stash since it is mostly a bottom and subjected to less volatility than trying to figure out what the fuck is going on with BTC spot price.. even while at the same time, BTC spot price is going to pull upon what the 200-week moving average does, in terms of the degree that it goes up and if it ever starts to go down rather than up, which so far it has not, especially over a 6 month period, which as you see from my fuck you status chart it's worst upward slope is slightly below 10% on any 6 month basis, which were three in a row in the last 18 months.

I didn't have time to read the other answers, I apologize for that, and I have one more question: is there any possibility that the strategy indicators inform that it is a good time to deposit more bitcoins so that the withdrawal is always sustainable?

I had been giving some thought to that, and of course, if you end up withdrawing many months in advance based on the strategy (for example if you ended up withdrawing 59 months in advance because BTC spot price were to go more than 14x higher than the 200-WMA, which would have been the case if you had used the tool on December 16, 2017), you could use some of that withdrawn in advance amounts in order to buy back some BTC, which would increase your budget for future months.

Whether it is necessary or not to do such a buying back of the BTC would surely be a discretionary matter based on all your personal particulars, including why such tool is being used and whether the use of such tool is for all of your BTC stash or maybe for sub-component or maybe even for some separate entity that you set up with a certain budget level.. which is probably why i am likely to continue to come back to the idea of starting out with 21 coins in late 2022 as my running hypothetical that I will likely continue to add hypothetical withdrawal amounts in order to keep it as a kind of running example. 

And by the way, if someone were to withdraw 59 months in advance or even 23 months in advance, that is a hell of a long time to not use the tool, and there surely could come a BTC price dip during that time that causes the person to buy back BTC at such a rate so that he would be able to get credit back for the "in-advance months" that he sold and then once he buys back the BTC then to go back to continuing to use the tool on a monthly basis based on the new BTC reference balance, with presumptively a higher budget based on his having had added more BTC to it... it is difficult to imagine any kind of selling 59 months in advance of BTC at 14x above the 200 week moving average or even selling 23 months in advance at 400% to 650% above the 200-week moving average and then not ending up having some kind of BTC price correction in 59 months or even 23 months respectively that might not justify buying back some of those advanced sold months.     

From what I understand of the strategy, it is made to possibly make a profit and definitively close the positions, is that it?

You are using trading language, and this is not a trading tool.  The main intent is not to use it as a trading vehicle but just to continuously withdraw on a monthly basis in order to live off of it, either in a retirement kind of a situation, a passive income situation, or just some way that a business might choose to budget itself from having such BTC holdings.  Both the ability to sell advance months when the BTC price is at least 33% above the 200-week moving average, and the restrictions on the sell amounts during periods in which the BTC price price is 25% or more below the 200-week moving average does cause the tool to help to guide rates of withdrawal based on how close the BTC price is to the 200-week moving average but at the same time giving some kind of guidance regarding how much to engage in such restriction of withdrawal amounts or advanced withdrawal based on decently good BTC price performance.

Of course, technically if someone bought bitcoin, whenever they sell they are closing the position, presumptively at a profit if they have held for long enough, yet if we are dealing with a long term investment and even slow rates of withdrawal, we are generally not using those kind of trading terms, so that is partly the reason that I continue to describe a withdrawal practice.. yet in the end, you can use the tool however, you like, even if it was not very much the intended purpose...and even when dkbit98 had earlier described the tool as a way to reverse DCA, I battled against that way of describing the tool, too.. even though maybe if we were to go into the higher levels of withdrawal, such as 30% to 100% (which the tool does not currently support such a withdrawal rate range - even though I am not completely opposed to it), we might label that as reverse DCA (or more expedited liquidation) or some other term to clarify that the tool is being used in a way that is outside the original conceptualization of the tool.

But if I wanted to use it again, this is my question. I don't know if I expressed myself correctly.

I think that I mostly understand what your various points and what you are asking, yet if you want to respond further, then no problem.

[bitmover]

From what I understand of the strategy, it is made to possibly make a profit and definitively close the positions, is that it?

You are using trading language, and this is not a trading tool.  The main intent is not to use it as a trading vehicle but just to continuously withdraw on a monthly basis in order to live off of it, either in a retirement kind of a situation, a passive income situation, or just some way that a business might choose to budget itself from having such BTC holdings.  Both the ability to sell advance months when the BTC price is at least 33% above the 200-week moving average, and the restrictions on the sell amounts during periods in which the BTC price price is 25% or more below the 200-week moving average does cause the tool to help to guide rates of withdrawal based on how close the BTC price is to the 200-week moving average but at the same time giving some kind of guidance regarding how much to engage in such restriction of withdrawal amounts or advanced withdrawal based on decently good BTC price performance.
I think that I mostly understand what your various points and what you are asking, yet if you want to respond further, then no problem.

I think that the main problem with communication is that most members here are still in the accumulation phase. (in WO, things may be different and there are more people which already reached their btc holdings goal)

most users when look at this tool think about how to use it to make their BTC holdings grow.

However, this is a tool to other phase of your investment life, the withdrawal phase (i.e. when you are already retired, not accumulating anymore).

[JayJuanGee]

JayJuanGee can made better answers, but i will try to answer some questions.

At a certain point, the investor's bitcoin supply will be equal to zero, right?

It depends on which Annual Withdrawal rate you choose. If you go below 6%  (conservative), ideally, even when you are very old and about to die you would still have some BTC. This is a sustainable withdrawal strategy.

is there any possibility that the strategy indicators inform that it is a good time to deposit more bitcoins so that the withdrawal is always sustainable?

I think that when you are not allowed to withdrawal (when the price is below the 200WMA), it is a good time to buy.

There will be a second tool which will do something like this. But I am still learning about it and we will release in a few weeks/months.

These are all good points, including that historically we have not had very many lasting periods in which the BTC spot price had been below the 200-week moving average, especially as it had spent a lot of time at or below the 200-WMA between about June 2022 and October 2023, so I am not even sure if we could expect those kinds of periods to come in the future or even to last very long, but surely anything is possible, including that it is possible that some day the 200-week moving average might have some negative periods.  I personally don't consider it to be too likely but I surely would not write off such possibilities...

So in that regard, if based on the tool's guidance, you had sold quite a few months of your authorized BTC withdrawal amounts in advance when the BTC spot prices were anywhere between 400% to 1,400% higher than the 200-week moving average (which would be potentially selling 23-59 months in advance), then it seems that if the BTC prices start to even get close to having way lower premiums, then you could use some of those advance sold months to buy back, and you would not even need to wait for it to go down to the 200-week moving average or even within 100% of it, especially because you had already sold at fairly high prices.. and even in the end some guys do get nervous about buying and selling and devolving into trading kinds of practices, even if you are seeming to trade the big price swings with limitations on your budget, you still would be ahead of the price if you are selling within the tool on the way up, including advance months of selling and you are finding yourself with a lot of extra cash, and discretion whether or not to buy back, because you also would be locked out from selling any more months, if you had already sold months in advance, unless were to use that money to buy back months that you sold in advance.. and I am not even proclaiming exactly how to do these kinds of things because the tool does not completely help you to figure out those kinds of discretionary and balancing matters.. even if you might be trying to mostly follow the parameters of the tool's guidances... ultimately you are completely responsible for your own decisions regarding the extent to which to employ the tool and how to do it.

which reminds me @bitmover,

1) maybe we should make some kind of further and more bolded disclaimer on the site, to help to make it clear that:

"Anyone using this tool in anyway, whether following its suggestions or otherwise is complete responsible for his own financial decisions, and this tool or any of the representations associated with it on this page or on any of our communication about the tool is not financial advice since each person is responsible for his own decisions whether following the tool to the tee or deviating from it in various ways or otherwise overly-relying on the tool, don't come crying to me or to bitmover if you end up losing money.... or failing to realize your full BTC potential or otherwise, since you are responsible for your own actions, inactions or even due diligence in regards to whether or not to invest into bitcoin, or how to cash out of bitcoin or whether or how to employ any tools like this one or any other tool that we provide in our various linked sources or discussions."

2) there may need to be another place on the page, maybe near the title that says "powered by bitmover" or some other variation of that.

From what I understand of the strategy, it is made to possibly make a profit and definitively close the positions, is that it?

You are using trading language, and this is not a trading tool.  The main intent is not to use it as a trading vehicle but just to continuously withdraw on a monthly basis in order to live off of it, either in a retirement kind of a situation, a passive income situation, or just some way that a business might choose to budget itself from having such BTC holdings.  Both the ability to sell advance months when the BTC price is at least 33% above the 200-week moving average, and the restrictions on the sell amounts during periods in which the BTC price price is 25% or more below the 200-week moving average does cause the tool to help to guide rates of withdrawal based on how close the BTC price is to the 200-week moving average but at the same time giving some kind of guidance regarding how much to engage in such restriction of withdrawal amounts or advanced withdrawal based on decently good BTC price performance.
I think that I mostly understand what your various points and what you are asking, yet if you want to respond further, then no problem.

I think that the main problem with communication with is that most members here are still in the accumulation phase.

most users when look at this tool think about how to use it to make their BTC holdings grow.

However, this is a tool to other phase of your investment life, the withdrawal phase (i.e. when you are already retired, not accumulating anymore).

It is true that if you are in your early accumulation phase or even deep into your accumulation phase, but not quite at a point to be liquidating, then you probably should not be using the tool, because it is not really good for growth of your holdings. 

Even though you are correct that there are a lot of members, and probably an overwhelming majority of members who are new to bitcoin, so they may well need to spend 4-10 years or longer merely accumulating BTC before they might either reach a maintenance stage or even a kind of liquidation stage, and the tool is better for maintenance and/or liquidation.. but if it is sustainable liquidation, then it would be kind of between maintenance and liquidation,  yet it is always going to be the case that there are newbies coming to bitcoin, and surely I don't agree with either trading and/or selling in order to accumulate more BTC, even though some folks will surely be engaged in those kinds of practices and maybe even relying on this tool in order to try to trade or try to increase their BTC stash... and I think that we already point that out on the page, and maybe we can make that more clear, even though we do already say that.. but guys will frequently want to figure out ways to increase their BTC stash, and maybe get lured into the wrong kinds of practices or tools such as using something like this tool, which is not meant for such purposes. 

[joker_josue]

It is true that if you are in your early accumulation phase or even deep into your accumulation phase, but not quite at a point to be liquidating, then you probably should not be using the tool, because it is not really good for growth of your holdings. 

Even though you are correct that there are a lot of members, and probably an overwhelming majority of members who are new to bitcoin, so they may well need to spend 4-10 years or longer merely accumulating BTC before they might either reach a maintenance stage or even a kind of liquidation stage, and the tool is better for maintenance and/or liquidation.. but if it is sustainable liquidation, then it would be kind of between maintenance and liquidation,  yet it is always going to be the case that there are newbies coming to bitcoin, and surely I don't agree with either trading and/or selling in order to accumulate more BTC, even though some folks will surely be engaged in those kinds of practices and maybe even relying on this tool in order to try to trade or try to increase their BTC stash... and I think that we already point that out on the page, and maybe we can make that more clear, even though we do already say that.. but guys will frequently want to figure out ways to increase their BTC stash, and maybe get lured into the wrong kinds of practices or tools such as using something like this tool, which is not meant for such purposes. 

Perhaps they could create a version of the tool that allows the user to enter their future goal and their withdrawal plans.

Imagine, I want to have 1BTC in 10 years, and then start making sustainable withdrawals. The tool would create a monthly purchasing plan to achieve this goal. And then I designed a sustainable withdrawal plan.
Or, instead of saying how much bitcoin I want to have in 10 years, I can indicate that I want to invest $100/month for 10 years, and then see the sustainable withdrawal plan.

Logically, this has to be another type of tool, and another type of strategy, because we are talking about future values and we never know what the future will be like.


@bitmover, another suggestion, maybe for the future. The possibility for the person to save the forecast, and whenever they return to the website they can retrieve the forecasts and adjust their planning. Instead of creating accounts, you can download a file, and then just upload it and the data will be available again.

[JayJuanGee]

It is true that if you are in your early accumulation phase or even deep into your accumulation phase, but not quite at a point to be liquidating, then you probably should not be using the tool, because it is not really good for growth of your holdings.  

Even though you are correct that there are a lot of members, and probably an overwhelming majority of members who are new to bitcoin, so they may well need to spend 4-10 years or longer merely accumulating BTC before they might either reach a maintenance stage or even a kind of liquidation stage, and the tool is better for maintenance and/or liquidation.. but if it is sustainable liquidation, then it would be kind of between maintenance and liquidation,  yet it is always going to be the case that there are newbies coming to bitcoin, and surely I don't agree with either trading and/or selling in order to accumulate more BTC, even though some folks will surely be engaged in those kinds of practices and maybe even relying on this tool in order to try to trade or try to increase their BTC stash... and I think that we already point that out on the page, and maybe we can make that more clear, even though we do already say that.. but guys will frequently want to figure out ways to increase their BTC stash, and maybe get lured into the wrong kinds of practices or tools such as using something like this tool, which is not meant for such purposes.  

Perhaps they could create a version of the tool that allows the user to enter their future goal and their withdrawal plans.

Imagine, I want to have 1BTC in 10 years, and then start making sustainable withdrawals. The tool would create a monthly purchasing plan to achieve this goal. And then I designed a sustainable withdrawal plan.
Or, instead of saying how much bitcoin I want to have in 10 years, I can indicate that I want to invest $100/month for 10 years, and then see the sustainable withdrawal plan.

Logically, this has to be another type of tool, and another type of strategy, because we are talking about future values and we never know what the future will be like.

I am pretty sure that I have created various BTC accumulation tools like that for myself that involve various ways to accumulate BTC that includes expectations of worse case scenarios, medium case scenarios and best case scenarios, and there are so many variables in terms of how much cash a person is able to put in and how the BTC price does, and just as a framework, we can consider that if someone invests 10% of his income over 10 years, then it will take that amount of time for him to reach 1 year's income invested, and we almost have to assume away changes in pay and also how much his investment portfolio might appreciate in comparison to changes in the cost of living, and so if someone might be able to be 3x more aggressive than he may well get close to having one year's income and/or expenses covered in 1/3 the time, maybe 3.3 years or less, and if someone is able to live off of ONLY 70% of his income, then he does not even need a whole years income as the measuring point for how much it costs for him to live each year, but at the same time, there could be desires to delay gratification mainly in order to increase the standard of living at a later date, whether that is realistic or not might be another story, but it does sound like a new tool, even if the tools could be related as you mentioned, since once you reach your goals, then you would be in a better place to transition from accumulation stage to maintenance stage to liquidation stage, but then there still could be a bit of a quite period between still accumulating bitcoin and then later going into a stage in which the BTC accumulator becomes comfortable to start to sell some coins.

By the way, also with your 1 BTC in 10 years, if you think about it, there is likely a need to invest around $200 per week just to get to 1 BTC in 10 years, and of course, that is based on various assumptions, so if you invest $100 per week into bitcoin for a year, then you have invested $5,200 over a year and that would be $52k over 10 years, and so that is part of the reason that I am suggesting that $200 per week would be more likely to get a newbie investor to 1 BTC in 10 years rather than $100 per week not having good chances of making it to 1 BTC in 10 years... of course, there can be built in assumptions regarding discretionary/disposable income and there can be variations in regards to expenses or increases in cashflow but guys can surely estimate all of those factors to come at some results that might be conservative scenarios, medium case scenarios and better case scenarios.  So yeah if you already have a head-start on your BTC accumulation quantity, then that would be something different from trying to project how many BTC that you would like to accumulate from here on out, and surely if you already have a stash, there are ways that the BTC stash might be able to be accounted, but there are also some assumptions of an ability to hang onto it if you already have it.. which may also be a pretty BIG assumption.. but could be factored into a tool that attempts to figure out how many BTC you might be able to accumulate within certain timeframes into the future.

Also, look at my entry-level fuck you status chart.  I had a couple of earlier versions that required less time to pass in order that 1 BTC would constitute entry-level fuck you status, but this latest chart version errors on the side of more conservative and in 10 years you need more than 7 BTC to reach entry level fuck you status and it takes until 2049 that 1 BTC would constitute entry-level fuck you status..  Of course that entry-level fuck you status chart presumes western standards, and surely there are folks who would be able to get by off of 1/4 or even less and consider themselves at entry level fuck you status.. so a $2 million would allow for $6,667 per month and $500k would allow for $1,667 per month which would be more than acceptable for some folks as a quasi-passive income.

[criptoevangelista]

...........

perfect! incredible explanation with surgical precision, now I really understood the whole point of this strategy and things cleared up my mind. Really excellent.

 is that most members here are still in the accumulation phase.

...................

However, this is a tool to other phase of your investment life, the withdrawal phase (i.e. when you are already retired, not accumulating anymore).

Indeed, I, like many here, are living in this phase of accumulation and attempts to increase capital, but we will inevitably reach a point where we can make profits and exit this phase and change our strategy.

Every good investor has to think about all the points and all possible variables, it's a life strategy, everything has to be calculated.

I really liked this tool and I will study it.

[Kakmakr]

I know this is a sustainable withdrawal strategy, but it would be interresting to see if you can also add a DCA comparison graph, to see what would have happened, if people used that money to buy BTC and not spend it.

Even a comparison that are based on the same strategy, but done through a Bank deposit and based on historic interest rates.

I believe people have to spend bitcoin, to stimulate bitcoin  adoption and also supporting the merchants that accept bitcoins, so thank you for providing a controlled method to do this.

Hoarding is a natural reaction, when you deal with something that beats inflation... but people should use a strategy like this to spend bitcoins, without having the fear and the regret that comes with that.  

[bitmover]

I know this is a sustainable withdrawal strategy, but it would be interresting to see if you can also add a DCA comparison graph, to see what would have happened, if people used that money to buy BTC and not spend it.

This would be a completely different tool.

Maybe using 200WMA to buy more or less would be interesting. Not a passive DCA, but a more active strategy of DCA using this 200WMA formula. Could be interesting.

[JayJuanGee]

I know this is a sustainable withdrawal strategy, but it would be interresting to see if you can also add a DCA comparison graph, to see what would have happened, if people used that money to buy BTC and not spend it.

I am thinking that your mindset is in the wrong place Kakmakr, because the overall purpose of this kind of tool is to figure out ways to draw an income off of your BTC, so there is a kind of presumption that your BTC holdings has reached a high enough state that you feel that you have enough and/or you need to generate income (or a cash stream) off of your bitcoin, but at the same time you are doing it in such a way that the dollar value largely would continue to justify the rate at which you are withdrawing.

And, by the way, what would be the purpose of withdrawing and the buying back except to sell with one hand and buy with the other, and sure, you are not framing your question like that because you are potentially presuming that if the BTC price goes down after the withdrawals then the person would be better off to buy back.. but still you would ONLY be thinking like that if you are not really ready to sell your BTC in the first place, or you have such a trading mindset that you cannot get over the idea of trading....so if you have a presumption that the market is moving down as you are selling then such a strategy would likely work well in terms of selling and then DCA'ing back, but we already know that overall the BTC price trends up and the 200-week moving average trends up, so this tool is also premised on the same kind of idea that the BTC price overall trends up, even though in the short term there can be extensive down or sideways periods.

Of course, since the tool itself is calculating lower rates of withdrawal for when the BTC price is no more than 25% above the 200-WMA and also since it shows the ability to advance withdraw once the BTC price gets more than 33% above the 200-WMA, therefore  you still could end up using the tool in order to create your own strategies around both withdrawal rates and for buying back.

Actually your suggestion to DCA with the money used for the withdrawal hardly makes any sense for the monthly withdrawal (except if you presume the BTC price is trending downward), but there could be some value to employ a kind of DCA (or buying back) for coins that are withdrawn for months in advance, yet there would still need to be some strategizing around that, and such strategies would likely have a whole hell of a lot of variability.  

So for example if the BTC spot price goes into the range of being 400% to 650% higher than the 200-WMA, then the tool authorizes you to withdraw 23 months in advance, and surely there could be decisions (and even uses of the tool) to buy back (and even DCA buy back) if the BTC price drops into some lower range.  I am not really sure how much of a drop would be necessary or preferred, but it could be possible that we could add some kind of tool that would suggest buying back some of the advance months sold if the BTC price drops into one of the lower ranges... perhaps even if the BTC price were to drop more than one range below then months (or fractions of a month) could be bought back on a weekly basis (even using DCA techniques.. even though it probably would not be fair to exactly call it DCA because it is buying on dip and could be DCA combined since there could be a time element in there too.), but it still would end up having quite a few discretionary matters built in.. even though I would not be opposed to adding that kind of a extra component to the tool if there were a way to allow it to not distract from the overall presentation.. It would likely end up being a section that involves using advanced months to be bought back.

I try to accomplish this in my other selling on the way up rake tool in which it allows for the customized selling of BTC at certain price points and then it allows for a speculation of buying back at certain price dips (that the user can customize both the selling points and the buying back points which may or may not end up getting hit, so therefore the tool also allows for an assignment of probability towards the buy back points getting hit).

Even a comparison that are based on the same strategy, but done through a Bank deposit and based on historic interest rates.

I am not sure what you are getting at with these kinds of comparisons.. because overall there would not be any advantage to sell and buy back unless BTC is in an overall downtrend. but then the reason to buy back would be presuming that the price is ultimately going to go up.. .which is the foundation of DCA buying....and the foundation of this tool is similar in the sense that you presume that the BTC price is going to continue to go up, so maybe there are some hesitancies to sell any BTC, so if you want to sell within a sustainable rate, you can still profit from the overall presumption that the BTC prices are going up (even though they might not in the short term and also that it is not guaranteed that they will continue to go up, even though the tool is still built upon that presumption).

I believe people have to spend bitcoin, to stimulate bitcoin  adoption and also supporting the merchants that accept bitcoins, so thank you for providing a controlled method to do this.

This tool goes more into the idea that the quantity of BTC that could be spent within any given month, yet it does not go into the questions of how such BTC would be spent - because we could imagine scenarios in which we are able to spend BTC at various locations, but if we are largely just converting BTC to cash, then that seems to be the more expedited way to accomplish what the tool suggests, in the event that there are not avenues to spend the BTC during the month, and surely there likely could be a preference to be able to spend the BTC on goods and services throughout the month whether that is rent, food, transportation, hookers, lambos, yachts, planes, and blow and/or other recreational/consumption goods or maybe it could be for investments into properties, equities, bonds, commodities... .. but there is also a presumption of converting all within the month, and the advance withdrawals would more likely be spent to convert to cash rather than consumption goods.. because as in the earlier example, of a BTC price that is 400% to 650% higher than the 200-WMA, there may well be some difficulties finding 23 months worth of items to consume, and it may well not make any sense, but if you spend 23 months in advance, then you are not allowed to cash out any more BTC from the fund until 1) the 23 months pass, 2) some months are bought back or 3) the BTC price rises into a higher category that triggers the allowance to withdraw additional months in advance.  So to me it seems that the most logical place for 23 months in advance would be to go to cash or cash equivalents or maybe something else that is somewhat liquid.. including the consideration that if the BTC price drops stupendously if the value is in cash, then several of those advance months could be bought back and allow for the increase of the BTC stash and the authorization to continue to withdraw using the tool, especially if all of the sold months are bought back.

Hoarding is a natural reaction, when you deal with something that beats inflation...

You frame hoarding as a negative, but if you are saving something like bitcoin or the soundest of all monies, then I would not label that behavior as negative.. The spending of least value of assets and/or currencies fits within the concepts of Gresham's law, which means that you should not be spending your most valuable of assets/currencies until you have run out of others to spend... which also might be a reason to use this kind of tool in such a way that sets your sustainable withdrawal percentage at a lower rate rather than a higher rate, especially if you are considering ways to allow your BTC to continue to grow in value.  Accordingly, I would think that a presumption of this tool is also that bitcoin is the best of monies, so you may well not even want to withdraw any of your BTC if you have other sources of income, but once your stash is a large enough size, then you can use the tool and continue to mostly hold onto your BTC. while at the same time choosing your own personal level of cashing out.

but people should use a strategy like this to spend bitcoins, without having the fear and the regret that comes with that.  

There still may well be questions regarding at what quantity of BTC might someone begin to use this kind of tool, and surely it could be started with any quantity of BTC, but surely it makes more sense to assure that you are mostly no longer in the BTC accumulation stages - even though there are ways to also use the tool to accumulate more BTC if you sell months in advance and then buy back those months at lower levels, presuming that BTC spot prices continue to fluctuate and go through these various levels in which they are way higher than the 200-WMA which triggers the selling of more months in advance or the way lower prices that are closer (or even below the 200-WMA) which triggers lower levels of BTC selling (withdrawal) but also could trigger some buying back of BTC as seems to be the question that you started out your post.

I know this is a sustainable withdrawal strategy, but it would be interresting to see if you can also add a DCA comparison graph, to see what would have happened, if people used that money to buy BTC and not spend it.

This would be a completely different tool.

Yeah it is either a very different tool or it is something that is very difficult to add to this tool without causing a lot of confusion regarding the more central purposes and presumptions of this particular too.

Maybe using 200WMA to buy more or less would be interesting. Not a passive DCA, but a more active strategy of DCA using this 200WMA formula. Could be interesting.

I think that several people do look at this tool and they consider various ways that they can use it to trade and/or to use the tool to their advantage in buying and/or selling, and surely one of the advantages of highlighting how close or far the BTC spot price is from the 200-WMA would allow the tool to be used in that way, even though that is not the framework in which we are trying to present the information...

I am not against trying to add some additional ways of looking at the data, even though it seems that the tool is already providing a lot.. especially if someone has already gotten to a certain quantity of BTC that he would like to consider within such a budget.  And, so i can also see how someone who is in a different stage of the BTC accumulation journey, they might be trying to use the tool in another kind of way... and that is really not a problem if that is what people want to do... and if they can find some advantages in that... but many times if someone is in their earliest of BTC accumulation stages, then they likely should be accumulating no matter what the BTC price, but then the dilemma comes for those who might have accumulated decent amounts of BTC, but they still do not have enough to be cashing out, so they could end up using the tool in ways to complement their BTC accumulation journey.. yet anything that devolves into trading is going to retain a certain amount of risk, and so the tool could also help with those kind of risk mitigation matters too.

[joker_josue]

A suggestion that I now remember.

Since in some countries you have to pay taxes on crypto income, it could be useful in the tool to have a field for the user to indicate the % of taxes.
It would be a free field, where each person would place what was most convenient for them.

This could be a good way to evaluate performance, taking into account the taxes you have to pay.

[JayJuanGee]

A suggestion that I now remember.

Since in some countries you have to pay taxes on crypto income, it could be useful in the tool to have a field for the user to indicate the % of taxes.
It would be a free field, where each person would place what was most convenient for them.

This could be a good way to evaluate performance, taking into account the taxes you have to pay.

Personally, I consider that specific kind of a tax field to contain way too many variables, even if we might concede that there are a lot of jurisdictional variations when it comes to tax treatment, there are also a lot of differences in regards to how any person might be treating his taxes including his ways to calculate his cost basis that could also vary based on tranches of coins that were being planned to be cashed out and how they are cashed out...there are also classified ways of spending coins that may have tax consequences in some kinds of spending, but might have exemptions in other circumstances.  Think about the context of gifting, in which in the USA, up to $17k per year per recipient could be exempted from taxes based on gifting, and there are other kinds of exemptions or reduction of tax consequences.

Sure there could be a general field rather than a tax specific field, the field would account for estimated expenses and it would reduce the payout amount in order to attempt to measure net pay as compared to gross pay, yet from my current thinking that kind of extra field seems to have tendencies to overly complicate the tool.  What do you think bitmover?  Do you want to add an expenses field?

One of the main reasons to use this kind of a tool is to get some kind of idea regarding how much BTC to withdraw and to even show maximum withdrawal amounts based on current BTC price conditions in relation to the 200-week moving average, and surely there could be some cases in which the actual benefits of the coins is reduced due to various transaction fees, taxes or other costs that could be applied right at the time of withdrawal, yet something like taxes might be a matter of how it is categorized within reporting categories that might be somewhat ambiguous and difficult to capture even if we were to put a general expenses field in there, and even if such an "expenses" field might be helpful, I am still leaning towards thinking that such a field adds more clutter, complication and distraction to the idea than it benefits - even though it is not totally irrational to want to include the consideration of those kinds of personalization ideas.

[joker_josue]

Sure there could be a general field rather than a tax specific field, the field would account for estimated expenses and it would reduce the payout amount in order to attempt to measure net pay as compared to gross pay, yet from my current thinking that kind of extra field seems to have tendencies to overly complicate the tool.  What do you think bitmover?  Do you want to add an expenses field?

One of the main reasons to use this kind of a tool is to get some kind of idea regarding how much BTC to withdraw and to even show maximum withdrawal amounts based on current BTC price conditions in relation to the 200-week moving average, and surely there could be some cases in which the actual benefits of the coins is reduced due to various transaction fees, taxes or other costs that could be applied right at the time of withdrawal, yet something like taxes might be a matter of how it is categorized within reporting categories that might be somewhat ambiguous and difficult to capture even if we were to put a general expenses field in there, and even if such an "expenses" field might be helpful, I am still leaning towards thinking that such a field adds more clutter, complication and distraction to the idea than it benefits - even though it is not totally irrational to want to include the consideration of those kinds of personalization ideas.

It doesn't need to be a very specific field, something generic could be interesting. The possibility of indicating a fixed value or a percentage.

It is true that there are several possibilities, in turn the person making the withdrawal may have expenses, expenses that will be deducted from the withdrawal amount. So, having a way for the match to get an idea of this value can help in making a decision. In fact, you can even change the data, and make the indicated withdrawal times no longer exist. Or change accounts for consistent withdrawals over time.

Anyway, it could be another variable for the accounts, which I remembered could be useful.