At a range of 2years, can a Bitcoin literate invest with a borrowed fund in BTC?

[EluguHcman]

On a multiple note, it is been said not to trade in the Bitcoin and  crytop industry with a borrowed fund because it is likewise as gambling which proffers the possibilities of lost. I have seen lot of traders and investors who made it prosperously and amiably in their ventures of chasing profits with borrowed funds.
It is is a norm fact that "No Risk and No Rewards"
Now, I have a friend who is educated about Bitcoin digital currency but doesn't have the capital to invest on it. Meanwhile... He is considering to take loan from his relative to pay back within the range of 2years.
This is to say he would have such range of time without a panic to pay back.

Hmm.... Please does it sound good quite understanding the volatility nature in the Bitcoin industry?

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[Rikafip]

Hmm.... Please does it sound good quite understanding the volatility nature in the Bitcoin industry?

Taking a loan from bank in order to invest in something as risky as bitcoin is (don't belive anyone tell you otherwise) is a stupid move, while taking a loan from a relative is even more stupid move as you may risk not only not being able to pay him back but also mess up family relationship.

So, tell your friend that he should find some other ways to earn more money in order to invest in bitcoin rather than taking loans to do so.

[Obim34]

On a multiple note, it is been said not to trade in the Bitcoin and  crytop industry with a borrowed fund because it is likewise as gambling which proffers the possibilities of lost. I have seen lot of traders and investors who made it prosperously and amiably in their ventures of chasing profits with borrowed funds.
It is is a norm fact that "No Risk and No Rewards"
Now, I have a friend who is educated about Bitcoin digital currency but doesn't have the capital to invest on it. Meanwhile... He is considering to take loan from his relative to pay back within the range of 2years.
This is to say he would have such range of time without a panic to pay back.

Hmm.... Please does it sound good quite understanding the volatility nature in the Bitcoin industry?

Relating the question back to you do you also think it is ideal hopping on such investment pattern? Is the risk worth it, you are expected to ask yourself all these.
Some risks are not worth taking, how sure is he for the market to experience a bull run or go in opposite direction,  since the market remains unpredictable it is not of certainty if after the interval of two years the market will be profitable for him to sell and return the money. Atleast if he is earning little income with the mindset of becoming a Bitcoin owner he can then apply the DCA strategy it will help him accumulate some good amount of Bitcoin with time.

[EL MOHA]

It is not only bitcoin but borrowed funds actually add to panic in that business you invest it into and thereby leading you to making rash decisions. I personally do not like the idea of Borrowing to invest in asset like bitcoin because of its volatility, so it is a bad idea to me. I see your friend is actually trying to maximize profits by looking for a duration of two years to return the funds which ideally should have bitcoin price higher before then. But I will tell you that it is still a prediction that bitcoin will raise after that years, there is a probability that it wouldn’t increase before your friend pays back the Loan which might lead him to lose.

Take for example last two years there was a heavy bitcoin dump say your friend had take this loan around January 2022 and decides to pay back this year, he would have been in loss now because the price then was above $45k and not that now.

Bitcoin has been advice to be invested in with an amount of we can afford to lose even if it is our money, so borrow funds is way out of the equation except you have a good collateral to fall back to

[logfiles]

What if things do not turn out as he expected? What next? Will he be able to pay back the loan. There is a reason it's always emphasized to invest what you can afford to lose. People have lost their lifetime savings because they think crypto is just going to skyrocket nonstop, and they then they become millionaires... Well, this is always the case. If it was that easy, we would all be rich traders
I am not trying top sound negative, but I want your friend to also look at it from a different perspective. If he is well-prepared of the risk and can afford it after two years, then well and good.

[Upgrade00]

I have seen lot of traders and investors who made it prosperously and amiably in their ventures of chasing profits with borrowed funds.
It is is a norm fact that "No Risk and No Rewards"

Bad choices have worked out for some, at some point in time, but they're still bad choices and should not be encouraged.
No risk; No rewards, follows the argument that without investing, which is a risk in itself, you cannot profit from price growths it doesn't mean one should throw caution to the wind.

Now, I have a friend who is educated about Bitcoin digital currency but doesn't have the capital to invest on it. Meanwhile... He is considering to take loan from his relative to pay back within the range of 2years.

There are no guarantees in any investment. Bitcoin expectedly should be at least 100% higher than what it is now and I'll be willing to risk spare money I got on it, I would not advise others to do so, much less borrow funds to invest.

[mk4]

"No Risk and No Rewards"

Using this quote doesn't automatically mean you're going to take stupid amounts of risk; using your own money is risky enough.

Like if you don't have capital, then do something about it so you can have capital — you know, probably like getting a job or starting a small online business?

Not because bitcoin has had predictable price cycles in the past doesn't mean it's guaranteed to happen again.

[boyptc]

Too much confidence will harm you.

Is he an expert and literate? it doesn't matter. While he do know the volatility of Bitcoin is there, he should be aware that he's like getting a rock to hit himself with it.

If he's literate to Bitcoin, what he needs to do is to get a source of income and spend his own money on it. The interest rates might even get his profits when he can sustain it.

Tell him that it's never been a good idea to invest in Bitcoin with a loan.

[Wexnident]

~

This all rests on the assumption that his investment would grow within said 2 years. Even if we do consider that there's no interest if he borrowed funds from his friends, it doesn't change the fact that there's no guarantee that he'd get his money back. That guarantee is something those who have their own money and invest with it can afford to not have but those who use loans? They NEED to have that guarantee, and it's just dumb to assume that it's going to naturally happen.

It doesn't matter that many people think that Bitcoin follows the same historical cycle, it can always change at any moment. Just get a job really. Or if he wanted to invest now to not miss out on any possible growth, then get a job and get a loan. Use the loan to invest and use the job income to pay back the loan slowly. This has an issue with the scale of the loan though since it's not realistic to loan a big amount then having a job with peanut salaries.

[Distinctin]

It’s easy to say that your friend will not be panicking since the duration of two years is quite long. But if you are already trading but still not making significant profits but only consistent losing within that 2 years, then most probably you will surely develop worries on how you will be able to pay back that loan. Remember that trading won’t never guarantee a fixed and consistent profits, regardless of how good you are in trading. If you are highly skillful on it, you might be making massive profits but it won’t be happening at all time as there are still inevitable losses in trading at some point.

Now, the question is if you are skillful in trading? Because if not, it’s better not to take any loan that you will only regret later on. Save if you want to trade, and trade of an amount that you can afford to lose. That way, if you lose, at least you are not compromising other people’s funds.

[Adbitco]

Before going to take loan he should also consider the duration of the loan how much he could made from the investment and how much he could use to settle out the loan amount so there are two things to be considered now.. The interest of taking loan for two years and the profits that could generated from investment, if the investments would yield 5x of the money borrowed then he should go borrow but if he knows that after borrowing he wouldn't get 2x of the money borrowed then no need to go borrow any money to invest considering the interest rate of taking loan for two years men that would be an outrageous loan. So is better he uses his personal funds to invest than taking loan since you can't predicts the feature of bitcoin what it could turn out to be.

[Pokapoka124]

It is generally not advisable for anyone to borrow money to invest in Bitcoin. Banks will never approve a loan if they know you plan on using the money to invest in bitcoin or a high risk investment. Bitcoin is very volatile and you can’t be certain what will happen in the next two years. Luckily for your friend, he’s getting the money from a relative, with no collateral and managed to get a long repayment plan. I still wouldn’t take the loan though, I would rather invest my own money no matter how small it is.

[hatshepsut93]

You shouldn't really invest in anything with borrowed funds, even more so in a risky asset like Bitcoin. This is basically a more extreme version of leveraged trading, because for leverage you have to start with something, but if you're taking a loan you could be tempted to invest without any of your own money.

And with Bitcoin specifically, its volatility plays a huge negative role here. You don't know when there will be ups and downs, but you have to pay back the loan at a fixed date. Now imagine that when that day happens Bitcoin is in a huge bear market and you have either to sell at a loss and find more money to repay the loan, or suffer the dire consequences of defaulting.

[Churchillvv]

I know you judged it already that is not good in any way to invest in Bitcoin that is already a risk of its own with a more risk as borrowing from anybody whether bank or relative.

There is a quote in my place that says whatever you achieved with a borrowed money is never yours. that means even if you eventually succeed with the ideal you will keep being in debt whether directly or indirectly.
Nobody is advise to rush into Bitcoin instead go get a job and invest with what ever you get from the job.

[Darker45]

I sometimes do what I won't advise other people to do. But borrowing money for investment purposes is something I would never do. However, it seems in the case of your friend, he has a lot of leeway in paying it. Did you say payment could be made anytime within 2 years? Or is it like the banks and other financial institutions which require regular small payments with a term of 2 years?

Provided the loan amount isn't big enough that paying it would require him to work day and night and cut on his basic needs, I guess this one's tolerable. Certainly, within 2 years, the price of Bitcoin will surpass $42,000.

But your friend can't be greedy. It's borrowed money. He has to be practical and realistic. If Bitcoin hits $60,000 in just 3 months, he may consider taking profit and paying the loan, forget about the 2 years and forget about a high target like $100,000.

[wxa7115]

On a multiple note, it is been said not to trade in the Bitcoin and  crytop industry with a borrowed fund because it is likewise as gambling which proffers the possibilities of lost. I have seen lot of traders and investors who made it prosperously and amiably in their ventures of chasing profits with borrowed funds.
It is is a norm fact that "No Risk and No Rewards"
Now, I have a friend who is educated about Bitcoin digital currency but doesn't have the capital to invest on it. Meanwhile... He is considering to take loan from his relative to pay back within the range of 2years.
This is to say he would have such range of time without a panic to pay back.

Hmm.... Please does it sound good quite understanding the volatility nature in the Bitcoin industry?

Your friend can do whatever they want, but the reason we discourage that practice is that it is very easy for those without any experience on the markets to think they can make a lot of profits, when in reality they do not know if they actually can.

So if your friend failed to reach their goal, not only they will lose that money, now they will owe it to someone else and they will have to pay interests on it, besides I do not like that your friend is supposedly educated about bitcoin, a process which should have taken a few months at minimum, and still they have no money to invest.

[Julien_Olynpic]

Investing in something using borrowed funds is not a good idea. However, in my opinion, borrowing from a relative can be an advantage to you. The relative must understand the risks associated with investing in cryptocurrency and he must, in fact, share this risk with the fund manager. But it would be better for everyone if the relative decided to participate in the division of profits in the event of a favorable outcome of the investment. That would be fair. But in this case, it turns out that the relative bears quite significant risks associated with the volatility of the cryptocurrency and does not have any privileges.
      If it were the relative’s good will to participate in investments, then he would be more tolerant of possible losses. This is what I call “informed consent.”

[synchronym]

op Bitcoin market has a lot of volatility so it is not a good decision to invest Bitcoin by borrowing from someone. If we borrow and invest bitcoin from someone then our thinking will increase twice so I think it is not in the case of anyone's bitcoin investment but in any business if you borrow money then we have to face problems. So it is the right decision to borrow and invest bitcoin. not  It will take two years for your friend to pay back the loan he borrowed for two years, of course hoping that the bitcoin market will grow more during these two years so that he can pay it back. Since the Bitcoin market fluctuates all the time, it is impossible to say that the Bitcoin market will move upwards.

[Gallar]

~Snip

Now, I have a friend who is educated about Bitcoin digital currency but doesn't have the capital to invest on it. Meanwhile... He is considering to take loan from his relative to pay back within the range of 2years.
This is to say he would have such range of time without a panic to pay back.

~Snip

This issue is often the subject of long debate. Because investing in bitcoin with borrowed capital is not recommended. Even though the person running it already has extensive knowledge about Bitcoin, the risks are still very large. Because you need to remember it
that no one knows what Bitcoin will look like in the next 2 or 3 years. The possibility could continue to develop or even experience setbacks. So this is where the role of capital used will be very useful to minimize risks that may occur. Indeed, if you look at Bitcoin today, it looks like Bitcoin will continue to experience good growth in the future. But you need to remember, don't just think about the good side, but the bad side must also be remembered and taken into account.
Because if we invest in an asset, including bitcoin, the calculations must be complete and not only think about the good side. Because in an investment there are always two possibilities that can happen.

So even though your friend has mastered and has extensive knowledge about Bitcoin, this is of course not enough and there are still shortcomings. Because for example, right now your friend is borrowing money from his relatives to invest in bitcoin. Then your friend promises his relatives that he will pay the debt within 2 years. Of course this will affect his mentality. But even so, the possibility of making a profit is also not small. Because currently bitcoin is in the right condition for the time of purchase. Because the Halving and Bullish Market will definitely arrive soon. For this reason, at this time bitcoin investors have the opportunity to make a profit. So at that time the opportunity to make a profit will be very big for you friend. However, my advice to your friend is, don't wait 2 years to pay off the loan. Because it would be better if, for example, your friend has made a profit, then the loan money must be returned immediately.

[Poker Player]

I see the underlying logic but the problem with such a move is that theory is one thing and practice is another. If the pattern that has happened in previous Bitcoin cycles is repeated the next 18 months or so will be bullish, meaning buy now to sell roughly then it seems like a good move. The problem when you use borrowed money is that you don't make the same decisions you make when you use money you have to spare. If things don't go as planned, if suddenly there is a big drop in the price, when you have invested with money that you have to spare you ride out the storm and do nothing but if it is money that you owe don't be surprised if you make rash decisions like panic selling.