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Let's take an example of when Gary, SEC chairman shorted Bitcoin before dropping the news that they ain't approving the ETF would you call that gambling?
I am not sure why you would use an example like that, even if it might be true, especially since we were talking about various behaviors of presumptively normal individuals, and when you are talking about folks who are taking advantage of insider information, then that surely is a calculated kind of a trade, and so there is still some chance that the intended effect might not play out like expected. Sure some normal people can sometimes become aware of insider information and attempt to act upon such information, so the more reliable the information and the more likely that the results will happen, then the less it is like gambling and more like a game of skill rather than a game of chance.. .yet I still find the example to be a bit problematic in terms of attempting to be more realistic about what more normal people are doing and what kind of options that we might have when we are reacting to the market rather than involved in manipulating the market or gaining advantages from our insider knowledge of such manipulations that might be attempted.
As I attempted to describe before, and you seem to understand Ambatman, there are going to be various behaviors in which the more information is known so that the probabilities of BTC price moves in one direction or another might be able to be predictable, yet some of us are not attempting to predict short term price moves, but perhaps instead attempting to be prepared for either price direction.. so I frequently like to assert that one of the most inevitable things in bitcoin is that the price is going to be volatile, yet we still can not have much confidence with the direction of the volatility, so there surely could be systems that any of us have in place in order to attempt to either benefit from the volatility or at least not be hurt by such volatility since we already know that the volatility is pretty damned close to inevitable.
Another thing that we might be able to presume is that the odds of the bitcoin price going up are reasonably good, especially if we are considering longer timelines of 4-10 years or beyond, yet we are still not guaranteed that the BTC prices are going to be going up, we just consider that they remain decently good to go up.. and maybe we cannot even put any kind of exact number on what the odds of bitcoin going up are, yet we also should be able to recognize and appreciate that there could be several year periods where BTC prices stay down and don't really go up and the bitcoin prices might end up gravitating for down rather than UP, yet we might continue to hold or bitcoin and even buy more bitcoin because we continue to have some confidence that at some point the BTC price is going to resume going up..
When I got into bitcoin in late 2013, I had hoped that over several years, I would at least be able to average a return of at least 6% per year with my bitcoin investment, yet at the same time, I also recognized that I could end up losing up to 100% of what I had put into bitcoin, so there was a kind of hope that the bitcoin would do at least the same average of what my various other investments had seemed to have been averaging over the previous 20-ish years.. so getting an average of 6% per year.. seemed more than a kind of balanced return in which my decision to hold bitcoin would not have had been doing any worse, but then not really doing any better either...
So partly based on my getting into bitcoin towards the top of that cycle (which my first purchase was around $1,200 per BTC) and continuing to buy bitcoin through out 2014 as the BTC price was dropping, my BTC holdings largely was in the negative for most of 2014, 2015 and even quite a bit into 2016 (even though my average cost per BTC continued to come down into the upper $500s by the end of 2014, and maybe into the lower $500s or the upper $400s in late 2015 and into early 2016), yet there were periods in 2016 in which I had implemented some systems of selling on the way up and buying on the way down that ultimately helped to balance things out but then I made mistakes too (that might have even caused my average costs per BTC to go up to $750 ish or even more safely to just round off and say that my average per BTC ended up becoming $1k-ish).. so maybe I could say that there were times where I could claim that my BTC holdings were breaking even or even that my BTC holdings were becoming profitable in the 6% per year kind of an approximated calculation. .but then sometimes the valuations of our holdings can become more and more complicated in terms of various ways it could be counted or evaluated.
So sometimes the way I would calculate the valuation of the costs versus the then BTC price, I would suggest that my BTC holdings were not clearly and unambiguously profitable until somewhere in early 2017, yet even up to March 2017, there had been times that the BTC price got into the mid to upper $1ks and maybe even close to $2k, but then it corrected back down to $800-ish, or so there were various threats that the BTC prices could dip back down to $500 or below $500 so some guys were scared out of their bitcoin, and surely I did not fall for that, so mistakes that I made were not related to those kind of trading and/or getting greedy or scared kinds of mistakes, so anyhow, when the BTC price recovered from the sub-$1k prices in March 2017, it did not end up going back down, so in that regard, my own BTC holdings were at least profitable in terms of going beyond my own goals of having at least 6% per year average profits, and so then after early 2017, if I just proclaim that my average cost per BTC was in the ballpark of $1k each, I no longer entered into negative profits territory, and my BTC continued to at least be as profitable as my 6% per year goals, and even if the BTC price shot up to close to $20k in late 2017 and then several times end up correcting back down to touch $6k several times, and even spent a decent amount of time between $3.2k-ish and $6k, there still could be some rest assurance that the amounts of profits exceeded by hopes in terms of having at least 6% per year average returns.
In 2021, I used to like to suggest that my returns were in the 75% per year territory, yet I just went back and recalculated based on the top of the 2021 BTC prices, and I still see that if we use $1k as the starting out basis, then the return would have had been more in the ballpark of 65% per year, and if we extend that out to this year, and the BTC prices are largely in the same ballpark as they were in late 2021, then today I would ONLY be able to calculate in the ballpark of 42% annual return.. So surely I am still way above 6% per year, and surely even 42% per year has been really great performance including how it compounds upon itself, so surely we can see going from $1k to $558k ends up being 58x returns, so using $1k as the basis does make it easier to calculate where we are at even if it might be a bit difficult to determine the CAGR (which is the annual return overall).
Bringing us back to trading versus gambling versus investing, we will find that if our investment timeline is over a longer period, we might reasonably calculate that there are decently good odds that the BTC price is going up in the long run, but surely if we end up being wrong, maybe we might have had ended up relying on bad information and we thought that we were investing rather than gambling.
By the way this is Part two of my above post, and this was the first time that the forum did not allow me to post because the error message said that my post had exceeded a 64,000 character limit.. hahahahaha..
Accordingly, this is the first time that I have been forced to split my post into two parts based on such a character limit. I am not sure if the forum changed posting rules or if this had been the first time that any of my forum posts had exceeded such 64k character limit. To avoid my sequential posts, I was going to wait until some other member were to post before posting this part two post, but you guys are too damned slow.. so I just decided to post anyhow nearly four hours between posts.. .
Lol when I saw the post, The first thing that came to my mind was "is this a Robot? "
Your skill and commitment is something i admire but doubt I could ever emulate.
I'm too lazy to create a thread with lots of words not to mention a post.
I was just responding to others, and it got a bit long.
I believe all your posts in BTT would be enough to make a bulky book on "Bitcoin for Dummies ", "HODL for beginners ", "HODL intermediate and advance", "HODL for the Rambo's " , "Trading a means to make the Rich Richer " etc and still have room for more.
I don't really talk about trading techniques or even advocate for trading, even though I do frequently advocate for tailorizing investment approaches and cashflow management ideas... and yeah over the years, some of my talking points have evolved.
Well that doesn't leave out trading or makes it seem useless cause there are several Bitcoin traders who are making profits from it and can still use their daily or weekly profits from trading to invest on a long-term, everyone mustn't be a trader infact it requires a high skill set and deep knowledge in analysing the market therefore everyone should stick to what works best for them without looking down on other methods of accumulating wealth through Bitcoin.
If trading was that useful, HODL wouldn't have been in existence.
As long as you trade the likelihood of having a bag you holding is low.
You going to sell at your perceived top and watch it go way higher than you expected and FOMO starts creeping in and you buy near the real temporary and it takes a dip.
Yep lots of folks sell too much too soon.. so that should be part of the justification to make sure you build up your BTC holdings first, and don't be selling with any expectations of buying back cheaper.. .. but yeah, many folks get too greedy.
Read a bloggers post that says it's going to fall more by 20% and FUD creeps in and you sell waiting to buy back.
Then boom Bitcoin goes against the bear again before you woke up on a beautiful day because it loves flying higher and breaking resistance more than anything
And you realised it has passed your previous buy and you are not aboard the rocket.
Then to quickly cover up your loss you switch to altcoins or future
Surely some folks end up becoming even more and more degenerate gamblers once they fall out of a more conservative practice of just accumulating bitcoin through buying techniques... Once you start selling, you may well lose your focus.. and then end up NOT buying enough.. which should remain the focus of anyone who does not have enough bitcoin. .just keep buying bitcoin no matter the price until you either have enough. .and better yet if you end up having too much.. that is the better case scenario that could justify selling some BTC and not giving any shits if the price goes back down or not..
Another problem is that people cannot really figure out how many BTC is enough or too much in order to start to justify an ability to start to sell.
If you cannot figure out a formula in which you have determined that you have enough or that you have too much, then you probably don't have enough and you should not be selling and you should just continue to buy until you reach such status of sufficient and/or over accumulation.. but hey, whatever, people make mistakes. I am not claiming it is easy to reach these determinations in ways that are personally satisfactory.
Then start making some profit and the next thing a news comes up that the owner of the project moved certain amount or got sued
Your money gets liquidated if on future and crashes if on spot.
And then come online and say cryptocurrency is scam.
Sorry I'm using the "You", Didn't want to use I
Cause ain't ever gonna be in that position again.
Getting involved in shitcoins is a BIG ASS waste of time, and probably we should not even go into too much detail about any of those dynamics since it is outside of the topic of this thread.
I really want to write a wall of text, but I'm just human
.
Sometimes I am thinking that some kind of speech to text would be better, but I tend to type out my ideas... so typing might be a bit slower, and there would be a need for me to get used to speaking to text rather than typing... I suppose my typing might have had gotten faster over the years..
Edit: I forgot to mention that you could check me for AI content. I am sure others have made such checks on some of my posts.., and too bad so sad, if there is any bot imitation that might be going on, then the bots are more likely imitating me, rather than the other way around. Although on the other hand, it might not be bad to get a bot assistant from time to time, but I have not yet gone down any such path... even though from time to time I will look up some information prior to posting about some issue that might not be on the top of my head.
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.....those who are into trading has no peace of mind they are at high risk of losing there money, but for those who are into Long term Bitcoin investment they always have nothing to worry about because there's zero risk.
The risk of losing money in bitcoin, even as a long term holder, accumulator and investor is not zero, yet surely there are more risks that are added when getting involved in trading that may or may not end up paying off, even though historically in bitcoin it would be pretty rare to find any trader who has outperformed a longer term holder and/or someone who buys and holds bitcoin regularly, especially if we might end up looking at comparing time periods of 5 years and longer.. there are some outperformers, but they are pretty rare and their skills might not be easy to replicate in the event that we presume that they were not just lucky.. .which also could be a factor.
By the way this is Part two of my above post, and this was the first time that the forum did not allow me to post because the error message said that my post had exceeded a 64,000 character limit.. hahahahaha..
Accordingly, this is the first time that I have been forced to split my post into two parts based on such a character limit. I am not sure if the forum changed posting rules or if this had been the first time that any of my forum posts had exceeded such 64k character limit.
To avoid my sequential posts, I was going to wait until some other member were to post before posting this part two post, but you guys are too damned slow.. so I just decided to post anyhow nearly four hours between posts..
Whether the forum changed the rules or not is literally the million dollar question here because if not, it is hard to believe that this is the first time you ever broke that max character limit!
Congratulations and maybe it is not only the first time for you, but the first time someone in the forum did it in general!
I would not say it if it was not true. That was the first time that I received that message.
Sometimes there are spammers who purposefully cut and paste text, and I am sure some of them have received such a message, in the event that it does not happen to be a new rule.
I have had previous long posts that I even thought might have had been longer than my above post(s), so that's why I was suspecting the possibility that the length of post rule might have had been changed.
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This is a good point and while I don't know whether the majority of participants here are around because they want to learn about good ways to build their portfolio long term, I think the best that someone who thinks he is a great trader can do is to use a simulator and do some trading without using real BTC.
Personally, I think that it is a BIG waste of time to be fucking around with simulators or learning to trade (or invest) in bitcoin without using real bitcoin.
I think I put this in a wrong way. I am not really a fan of using fake money either. I was more referring to the fact that those taking a simulator seriously will 95% of the time quickly find out that there is no point in trading. My point was not to learn
how to trade, but to
not trade at all.
That is a fair enough point, and surely there could be some people who are kind of on the margins who might be persuaded not to trade from information of losses, yet some folks are still curious or they are gamblers or there is some kind of curiosity in which they almost need to learn for themselves, and surely sometimes there should be no need to use a lot of money in order to learn, but people likely devolve down the slippery slope of becoming greedy.
Bitcoin isn't predictable and some fancy lines won't help either whether they come from a guru or not.
Sometimes the squiggly lines have persuasive power that contributes to the assignment of higher probabilities than they deserve.. even though sometimes the squiggly lines might also end up working.. or appearing to work.
So yes, I wasn't actually recommending to use simulators in order to develop a proper understanding and learn how to manage emotions. Of course, real money is the real deal here but I hope not too many people fall for the dream that day trading makes them rich. In many cases a simulator for a week would probably enough to prove that they can't predict the price.
There are certain personalities drawn to it, and yeah sometimes a few successes might contribute to more boldness and/or greater confidence.
If a person has a day job and they are trading on the side with some of their extra money, then I suppose that could help to learn and they are still getting their income from their job.
The most I hope to accomplish is perhaps to attempt to convince someone to limit their exposure to trading to no more than 10% the size of their bitcoin holdings and without cheating (and keeping on drawing into the bitcoin after they lose it), and sure there could be some cases in which a person has concluded that he is good at trading, so there surely can be more and more and more temptation to tap into more and more capital in order to make more money (and to make it "worth their time," so surely the whole trading practice is problematic in regards to slippery slope dynamics of getting lured in more and more and more...
Personally, I would rather talk about investing and cash management techniques, anyhow, and sure if there might be ways to be profitable in trading, then there are threads to specifically talk about those kinds of things.. and this thread does not seem to exclude such discussions about trading.. although trading discussions sometimes will devolve into talking about shitcoins, and surely we are not in an appropriate thread to devolve into shitcoin discussions.
The thing is that I believe those with not a lot of money at their disposal should ALWAYS use DCA whenever they have a long term plan because price drops wouldn't make them nervous, shouldn't make them nervous. They can see their BTC stash grow faster when BTC drops and that is actually their goal and why they want to day trade. They want that BTC number to go up in the first place and that is what's happening when they buy for 50 USD a week and BTC dropped in price by 20%. Their BTC account is growing faster.
Sure. Accumulating more BTC would result in portfolio value going up once the BTC price goes back up...so yeah, there is a longer term rather than shorter term need, and surely, people can also get distracted by merely being in profits, so then they may want to start to sell too much of their BTC too soon when they get into profits by a certain level, which might end up screwing them later down the road if they end up selling too much too soon.
Trading is maximum risk and usually for those who already have quite a lot of money and are willing and able to put it on the line. But there is a reason why many of these dormant whale wallets don't make a move for years or sometimes a decade. These whales might still be trading with a portion of their holdings they have elsewhere, but the big wallets are just dormant for a good reason.
Sure, probably playing the big moves is a better strategy than attempting shorter term trades... but yeah there can still be weighting problems with any account in terms of how much might be kept in dollars versus how much is kept in exchanges, and surely there are some folks who keep large portions of their BTC completely off line, so I would imagine that you are mostly keeping some BTC on an exchange out of a possibility to sell some or all of it at some point, and the same is with keeping cash on any exchange for the purpose of using it to buy some or to use all of it to buy bitcoin... so yeah, there can be a question regarding how much BTC and dollars to keep on exchanges.
up until 2017, I kept quite a bit of my overall value on exchanges (probably more than 50%), and I suppose I had extra of both dollars and bitcoin on various exchanges "just in case." In late 2017, I downsized to about 20% of my value on exchanges, and then around 2020 I was down to about 12% of my value on exchanges. Around early to mid 2022, I got it down to about 8% and I think these days I might be around 5% on exchanges... so I am trying to keep the amount somewhat streamlined, and anything that is there is already in buy orders for dollars and sell orders for BTC... My buy orders go down to $25k-ish..and my current sell orders go up to $150k-ish... and over the years the spread has gotten bigger and bigger both in terms of dollars and also in terms of percentages, but even sometimes when the price is ranging, I do end up narrowing the spreads.. .. so there is the spread between buys and sells that can be tweaked, of course, the amounts can be tweaked and the increments between orders can also be tweaked.. so don't get me wrong, I don't sell with any expectation of buying back, so the amounts that I sell are quite small, so I think even if the BTC price doubles I am authorizing myself to sell up to 10%, but my sell orders amount to less than 5%.. and my buy back orders are slightly greater than my sells.. which over time had caused my lowest buy orders to move up from sub $20k and currently right around $25k. ..and right now, I am having a hard time imagining any buy orders below $35k being executed, and surely I am not even holding my breath for any of those lower buy orders to be implemented.. including that I never even want the BTC price to go down rather than up, I am way better off if the BTC price goes up rather than down, even though I have maintained both up and down orders since about mid-to-late 2015, and prior to that I ONLY had buy orders.. through the whole of 2014 and more than half of 2015.
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It is a minority and the issue is that you can't even tell whether a part of that minority simply got lucky or not. If someone used some of these platforms that offer leverage and a gambler got it right with 100x leverage and turned 100 BTC into 10.000 BTC, I don't consider that person a genius trader. It was luck. There is a reason why shorts get wiped out on a regular basis. It's gambling.
I am not going to argue with any of that.. there are extreme traders who use a lot of variety of leverage tools, there are some who modestly use leverage tools and other financial instruments like options and futures and derivatives, and there are also traders who don't employ leverage tools or other financial tools. And many experienced traders will have bets going in both directions, and likely successful traders are able to set up their positions so that they make money in either direction.. but still it might take a lot of experience to figure out how to set those trades up and to tweak them from time to time in order to make sure they remain profitable, don't get overly greedy in order to sometimes lock them in and to open up new positions or to consider whether to open up new positions.
Having extra capital will likely provide more options for the kinds of trades, since sometimes capital could get locked up for extended periods of time inside of certain trades, and surely there will be a lot of discretion in regards to how to manage the capital that is available and even the extent to which to withdraw for living expenses or other non-related expenses that cause the capital to no longer be available for investing.... which also can contribute to decisions regarding whether other sources of income are available or if a person might be expecting to live off of his trade money.. and surely I would also ponder that the most successful of investors would not be using living expenses money for trading.. so in that regard, there likely are ways to set aside capital that is used for living expenses, and even better yet if the capital were to be perpetually sustainable.. for example in traditional assets, if you need $6,666 per month for living expenses, then you would need to have $2 million tied up to be able to draw 4% per year from that.
I have calculated that with bitcoin you could probably get away withdrawing 10% per year, so you would only need around $800k (if you uses the 200-WMA as your valuation measure)...so that would ONLY be 21k so long as the BTC price stays at least 25% of the moving average (which is currently $38k, so 25% above that is currently $47,500... anyhow my main point is to have some sources of income that would support your living expenses apart from your trading capital.
As for people being hesitant because of all the downside risks they see, my impression is a bit more positive as I know people who bought BTC where I never thought they would. Some in their mid 50s, even 60s, and often times they don't fully understand the technology behind it, but they slowly but surely get this idea why it is very likely to be around for a very, very long time. Lots of people are changing their minds for the better, but it is of course still true that the vast majority is still skeptical although only a very tiny fraction of the skeptics could tell you in a few easy words what bitcoin is about. They are still in ignorance mode. But I am convinced that with time passing by, more and more people will either voluntarily learn about it, new generations grow up with it as if it has been there forever, and some people will learn the hard way when one day they ask themselves why their fiat can't pay the same amount of stuff it was able to pay 10 years ago. It's already happening and the number of people approaching me asking about bitcoin did certainly increase over time.
Well yeah, some of the fiat people who failed refused to buy bitcoin are asking why that bitcoin holder has not suffered the same denigration of wealth as the one who had failed/refused to invest in bitcoin, and yeah, so we have already been undergoing what may well be the greatest wealth transfer in history from the no coiners to the coiners, and some of the no coiners will realize earlier than others (do we call those precoiners?), and so yeah the wealth transfer process can be uncomfortable and at the same time, it also can be a bit subtle.. especially while it is happening and without using a zoomed out perspective.. and people frequently don't even believe in the zoomed out perspective when they see it.. many nocoiners and bitcoin skeptics will see the zoomed out perspective as an unsustainable bubble rather than as the wealth transfer evidence that it really is.
But one thing holds true: most people can't resist selling back and forth when they get started with bitcoin. Stories when someone sticks to a plan from day 1 are quite rare.
It is probably o.k. to play around with trading if there is some kind of way to limit your practicing amount.
Let's say if a person comes to bitcoin and such person already had spent 15 years or more building his investment portfolio and he has right around $500k in networth through various quasi-liquid assets, so he decides to invest 15% into bitcoin, which would be right around $75k into bitcoin, and yeah maybe the first issue is how to accumulate such bitcoin, so then once he establishes his position, then he might be tempted to trade and/or to fuck around with shitcoins... so if there is a limit of 10% towards shitcoin and/or trading, then at least he would ONLY have a total budget of $7,500 for those things.. and hopefully he would be able to live within such limitations in terms fo whatever experimenting that he might attempt.
Another thing is that if he decides to continue to invest $1k per month into all of his various holdings.. so if he sticks to investing 85% into his traditional investment ($850) and 15% into bitcoin ($150), and so maybe from the bitcoin investment, he might want to take 10% and put into his shitcoin pot and/or his trading.. so that would be around $15 per month that could go in that direction based on these parameters. Surely, folks can create whatever parameters and limitations upon themselves....and sometimes people who have already spent a decent number of years building their investment portfolio, they are not going to be very inclined to be fucking around with either trading or shitcoins, and so we likely can logically infer that much of the temptations of trading and/or getting into shitcoins more likely comes from folks who are trying to get rich quick and they might not even know how to set trading and/or shitcoin limitations upon themselves, when they also should be focusing on bitcoin first and bitcoin investing first, but they may well get lured into trading and/or into shitcoins rather than focusing on first building their bitcoin stash.
